The 2024 State of Fractional CMO Engagement: Insights from Startup and SMB Leaders

Survey Results

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Question 1: Are you currently working with or thinking about working with a fractional CMO?

Survey respondents revealed a growing interest in fractional CMOs, with 9% either currently working with or planning to engage one in the next 12 months. This marks a steady increase from the previous year’s 5% single question survey, signaling a broader adoption of the fractional CMO model among both startups and SMBs.

Explanation of Trends: While 9% may seem modest, the year-over-year growth suggests that more businesses are recognizing the value fractional CMOs bring, particularly in terms of cost-effectiveness and flexibility. Startups, especially those in early or rapid growth phases, tend to view fractional CMOs as a way to access high-level expertise without the full-time salary commitment. For SMBs, the fractional CMO offers an opportunity to scale marketing efforts without overextending resources.

Notably, many bootstrapped startups favor this model for its flexibility, while venture-backed companies may start with fractional CMOs but often transition to full-time hires as their marketing needs and budget expand.

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Question 2: What are the primary reasons for engaging (or considering) a fractional CMO?

Respondents highlighted a variety of reasons for bringing on a fractional CMO, with the most common being:

• Cost-effectiveness: 78%
• Access to high-level expertise: 72%
• Flexibility in engagement: 65%
• Strategic guidance: 61%
• Scalability of marketing efforts: 53%

Explanation of Trends: Cost-effectiveness was cited as the top reason for engaging fractional CMOs, which makes sense given that startups and SMBs often operate with constrained budgets. Instead of committing to the significant financial investment of a full-time CMO, businesses can tap into experienced marketing leadership at a fraction of the cost.

Access to high-level expertise is another critical factor. Startups, in particular, benefit from having seasoned CMOs who can provide strategic direction, even if only on a part-time basis. This is particularly appealing for companies that need someone to come in, execute on key initiatives, and leave without long-term obligations.

The desire for flexibility is also prominent, with respondents noting that fractional CMOs allow businesses to adapt their marketing strategies based on changing needs and market conditions. This is especially important for businesses that need to remain agile, whether they are testing new products or scaling up operations.

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Question 3: What are the most valuable skills or areas of expertise you seek in a fractional CMO?

Respondents identified several key skills they expect from a fractional CMO, with the top areas of expertise being:

• Strategic planning: 86%
• Digital marketing expertise: 79%
• Brand development and management: 68%
• Data analysis and insights: 62%
• Content strategy and creation: 57%

Explanation of Trends: The majority of respondents—86%—placed strategic planning at the top of their priority list when it comes to the skills they expect from a fractional CMO. This highlights a strong demand for high-level, forward-thinking leadership that can shape and guide a company’s marketing direction over time.

Digital marketing expertise followed closely, reflecting the increasing importance of online growth strategies for both startups and SMBs. Whether it’s SEO, paid advertising, or social media management, businesses expect their fractional CMO to have deep expertise in navigating digital channels effectively.

Brand development and management was another highly sought-after skill, particularly among companies looking to scale or re-position themselves in competitive markets. In addition, data analysis and insights are becoming more critical as businesses increasingly rely on data-driven decision-making to stay competitive.

Finally, content strategy and creation is a growing area of focus, especially for businesses seeking to build long-term engagement with their customers through value-driven content. This emphasis on content ties directly into broader marketing efforts, such as lead generation and brand-building initiatives.

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Question 4: How do you assess the performance of a fractional CMO?

When asked how they evaluate the success of a fractional CMO, respondents pointed to a mix of quantitative metrics and qualitative insights. The top performance indicators are:

• KPI Alignment (66%)
• Revenue Growth (58%)
• Brand Recognition/Perception (55%)
• Lead Generation Improvements (52%)
• Customer Acquisition Cost (CAC) Reduction (31%)
• Employee and Team Satisfaction (23%)

Explanation of Trends: Startups and SMBs tend to focus on clear, measurable results when assessing the effectiveness of fractional CMOs. KPI alignment tops the list as it reflects the ability of the CMO to stay focused on agreed-upon business objectives. Given the data-driven nature of modern marketing, revenue growth and lead generation improvements come in as secondary metrics, underscoring the importance of CMOs demonstrating a direct impact on the company’s bottom line.

Interestingly, more than half of the respondents reported that brand recognition plays a major role in their evaluation. This suggests that fractional CMOs are being tasked with not only driving short-term gains but also positioning companies for long-term success in competitive markets. The increasing focus on employee and team satisfaction indicates that the best CMOs are also viewed as leaders who can inspire and upskill internal teams.

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Question 5: What challenges do you think are possible when working with a fractional CMO?

While the benefits of hiring a fractional CMO are well-recognized, some perceived challenges were thought about before hiring:

• Consistency in communication: 48%
• Integration with internal teams: 43%
• Understanding company culture: 31%
• Difficulty maintaining long-term vision: 27%
• Perceived lack of commitment: 24%
• Difficulty building relationships: 22%
• High onboarding time: 19%

Explanation of Trends: Although communication was raised as a concern, many respondents felt that setting clear expectations and regular updates would mitigate potential issues. Thoughts of integration challenges were mostly related to smaller teams with less structured processes, while cultural alignment were considered but also they thought about valuable new perspectives.

For long-term vision, some companies felt fractional CMOs were best suited for specific growth phases but still provided strong strategic clarity. Lastly, relationship-building was mentioned as a potential thought of concern by some.

Overall, the flexibility and expertise fractional CMOs offer outweighed these challenges for most respondents.

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Question 6: What is your biggest concern when hiring a fractional CMO?

The biggest concerns that companies face when hiring a fractional CMO revolve around value and alignment. The top concerns are:

• Commitment level (51%)
• Onboarding efficiency (45%)
• Cost vs. ROI (38%)
• Maintaining strategic focus (33%)
• Alignment with existing teams (29%)
• Expertise in niche markets (19%)

Explanation of Trends: The largest concern is whether a fractional CMO will provide the necessary commitment level to make a meaningful impact. More than half of respondents worry that, because fractional CMOs typically manage several clients at once, their focus could be divided, leading to suboptimal results for the business.

Onboarding efficiency is another sticking point. Many SMBs lack the resources or time to bring a new leader up to speed, and a slow onboarding process can significantly delay the execution of marketing strategies. This concern is heightened in fast-moving industries like SaaS and e-commerce, where agility is critical.

Companies are also focused on cost vs. ROI, with 38% reporting this as a key concern. While fractional CMOs offer a cost-effective alternative to full-time hires, respondents expressed uncertainty over whether the investment would directly correlate with the anticipated results.

Concerns around maintaining a strategic focus were more prevalent in smaller startups, where founders noted that it was challenging for part-time executives to fully immerse themselves in the company’s long-term vision. Additionally, alignment with existing teams was cited as a difficulty, particularly for those with tight-knit in-house teams.

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Question 7: What is the ideal timeframe for working with a fractional CMO?

When asked about the preferred duration for working with a fractional CMO, the responses showed a clear divide between SMBs and startups:

• 3 to 6 months: 34%
• 6 to 12 months: 23%
• 12+ months: 33%
• Less than 3 months: 10%

Explanation of Trends: Interestingly, 33% of respondents indicated that they plan to work with a fractional CMO for 12+ months, with a weighted majority of those in this category coming from SMBs. These businesses, often operating with smaller teams and tighter budgets, see long-term value in fractional CMO engagements. They view these leaders as cost-effective and flexible partners who can help guide sustainable growth over time, particularly as they scale.

In contrast, venture-backed startups tended to view fractional CMOs as a short-term solution. Many respondents in this group believe they will outgrow the need for a part-time executive as they scale, eventually bringing marketing leadership in-house full-time once their business reaches a certain size or complexity. These startups expect their growth trajectory to necessitate a full-time CMO as they expand marketing budgets and need more constant oversight.

On the other hand, bootstrapped startups were more open to longer engagements with fractional CMOs. They often appreciate the financial flexibility of maintaining a fractional role while avoiding the long-term salary burden of a full-time executive. These startups tend to leverage fractional CMOs not only for strategic guidance but also to fill gaps in their marketing teams as they grow at a more measured pace.

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Question 8: Which industries benefit most from fractional CMOs?

Certain industries have emerged as prime beneficiaries of the fractional CMO model. The top industries benefiting from fractional CMO engagements include:

• SaaS/Software
• Professional Services
• E-commerce
• Healthcare & Wellness
• Insurance

Explanation of Trends: The SaaS and professional services sectors are clear leaders when it comes to engaging fractional CMOs. In these industries, companies often have complex, highly competitive markets that require strategic leadership and advanced digital marketing skills. Additionally, many SaaS firms are in high-growth phases, making fractional CMOs a natural fit for driving scalable marketing efforts.

E-commerce businesses also see significant value from fractional CMOs, particularly in the areas of brand development, content strategy, and conversion rate optimization. As the e-commerce landscape becomes more competitive, having access to part-time marketing expertise without the financial burden of a full-time executive is especially appealing.

Interestingly, healthcare and wellness has also emerged as a strong contender, with 38% of respondents in this sector reporting benefits from fractional CMO engagements. As these industries become more consumer-facing, fractional CMOs are helping them navigate patient engagement, digital marketing, and content strategies in a regulated environment.

Finally, insurance companies, while not at the forefront, are increasingly leveraging fractional CMOs to manage brand positioning and launch strategies in an ever-saturating market.

Conclusion

The 2024 State of Fractional CMO Engagement report reveals that startups and SMBs are increasingly recognizing the value of fractional CMOs. With the growing demand for strategic marketing leadership, especially in digital spaces, fractional CMOs are set to become indispensable to many growing businesses. However, integration and communication challenges remain critical areas to address as this model continues to evolve.