5 Marketing Insights from a Fractional CMO

5 Marketing Insights from a Fractional CMO

Contrary to the myth that good products sell themselves, behind every successful brand is a successful marketing strategy. The best products and services can fail to break through without a targeted marketing approach, especially in a time when messages blare at us from every direction, and consumers are highly sophisticated. If anything, there are numerous examples of superior products losing out to superior marketing. Companies that don’t know who they are selling to and how to message to them risk being lost in the crowd.

Marketing is part art, part science. While there’s no easy creative calculus, some basic principles can go a long way. The best marketing campaigns, such as Apple’s “Think Different,” are simple, powerful, and in retrospect, almost obvious. But there is nothing easy or obvious about crystallizing brand, messaging, and positioning. That’s why even the best entrepreneurs, like Steve Jobs, don’t do their own marketing. They turn to help from expert marketing professionals.

InterimExecs RED Team executives, Ray Smale and George McGowan, share the marketing lessons they’ve learned over their careers and when it makes sense to bring in an interim or fractional executive for a CMO or Chief Growth Officer (CGO) role. They emphasized the need for fundamentals yet cautioned that, amid rapidly changing technologies and consumer patterns, companies must be prepared to pivot.

Connect With Everyone, Reach No One

Ray Smale is classically trained in CPG marketing, learning the basics of brand management at General Mills before making a splash in the B2B world leading retail and online marketing at companies like Kaplan. According to Smale, marketing, at its core, consists of segmentation, targeting, and positioning. “You find a segment that is going to be interested in the service that you have, and that shares some kind of commonality of beliefs, approach, and interests. You then decide where to target them and how to position against them, how to message to them,” he said

One of Smale’s keys to marketing is that less is more. “You have to say, I’m really only trying to talk to these people, but I’m going to talk to them in a very strong way, rather than trying to connect with everyone and reaching no one.”

You Can Build It, But They May Not Come

George McGowan began his career working in brand management at consumer packaged goods (CPG) companies Kelloggs and Miller Brewing before moving into the digital space. He helped launch the Helly Hansen brand in the United States and currently provides fractional CMO services to small businesses and entrepreneurs seeking growth and brand strategies.

McGowan has observed that many founders are great engineers but bad marketers. They falsely believe that they can use a passive approach based on “product first, functionality first” to create brand and drive sales. Although this mindset is prevalent in the tech world, it can be a major barrier to success for any company. For a given product, consumers today must choose between hundreds or thousands of options with only slight differences in price and functionality. Without a clear message, a business won’t stand out.

“If we’re talking about the features, benefits and functionality of your product to a specific market, in essence, that’s creating a brand,” said McGowan. “That brand is really how the market is going to perceive your collection of features and benefits. Without some sort of positioning to reach out to that market clearly and communicate what these features and benefits are and the value they bring to you, you are just sitting back waiting to be discovered.”

It’s Not About the Product, It’s About the Consumer

There are benefits to being the first company to introduce a product or service to the market. But the so-called “first mover advantage” does not guarantee success. Later entrants can avoid mistakes made by the first mover and find ways to make their business better or cheaper. They can also capitalize on much of the energy the first mover put into marketing their business. The business world is a copycat world. Often, the winner is not the company with the best product, but the company with the best marketing.

Smale gave the example of Betamax (Sony) and VHS (JVC) in the early days of video recording technology. Betamax was first on the market and the superior format for recording due to better resolution, better sound, and a more stable image. VHS, however, cost less, had a longer run time, and became the preferred format for movie rentals. JVC out-marketed Sony and their VHS became a household name.

“There are multiple examples where you can have that clear tech benefit, but if you figure out how to put a marketing campaign together around it, you can beat inferior tech and beat out a competitor,” said Smale.

Smale noted that you can be the first to market, like Uber, but as soon as Uber came out, there was Lyft. As soon as you have OfferUp, there’s LetGo. Gillette lost 100 years of market dominance in less than 10 years as a result of upstarts like Dollar Shave Club delivering razor blades to the customer’s house. They don’t necessarily make better blades than Gillette, but that is beside the point.

“It’s not about the product, it’s about the consumer,” said Smale. “It could be cereal. It could be a razor blade. It could be a heart monitor. But it’s about the consumer; about understanding them and connecting with them.”

“Companies may think of brand as nice to have but it is ultimately not about them or their product,” said McGowan. “Ultimately it is about the consumer and understanding the consumer’s needs, wants, and desires.”

No Company is Safe – No Matter How Big

Gillette is far from the only company that has lost ground to newer, leaner, and smarter competitors. Digitally native brands like Warby Parker (eyewear), Casper (mattresses), and Bonobos (men’s clothing) have upended their respective industries by using novel ways to make and market consumer products. They recognized that consumer preferences had changed and they built products based on the customer. Many of these brands would be unthinkable without the internet and online social networks.

Smale experienced the same thing while working at General Mills, where they were constantly iterating on yogurt. He describes going from yogurt in a pot with a spoon to Go-Gurt that made yogurt much more snackable – easier to eat on the go and for mom to add to the kids’ lunch boxes. While Yoplait and Dannon battled over yogurt flavors and formats, along came Chobani with Greek yogurt. Smale says they “completely missed the fact that consumers were looking for less sugar, more protein and that Greek yogurt was the thing.” Consumer preferences changed, and despite being the leaders in the sector and putting millions of dollars into market research, the major incumbents were looking in the wrong direction.

“I think one of the challenges that the big companies have is they still struggle to get beyond sort of the hub and spoke, the brand being the center of the wheel. And they iterate around convenience and functionality and portion sizes and things like that, where we’ve moved beyond that,” said McGowan. “We live in the consumer age. Consumers talk to each other, they find like-minded communities. We increasingly live social lives.”

When to Engage a Fractional CMO or Chief Growth Officer

Companies struggling to build a stronger brand and marketing presence could look to outside help from an interim CMO or CGO. A fractional CMO, or an outsourced marketing executive who can be engaged for a number of hours or days each month, provides Fortune 500 experience at a fraction of the cost of a full-time hire. CMOs like Smale and McGowan provide a hands-on resource to not only create a clear marketing strategy, but execute on it.

So when should a company consider engaging an interim marketing executive or team? Smale said it might be time “if you can’t explain to me who your main segment is, why they’re buying from you, how you’re reaching them and what your cost per acquisition is within that group. And if you’re looking for growth, are you going deeper into that group or are you looking to go after another segment? If you can’t answer these questions, then you really are just winging it. You know how your product works. Well, how does your marketing work?”

Sometimes, looking to an outside industry can help. At the end of the day, the ability to break through and differentiate is unlikely to come from somebody who has spent their entire career within the same industry, said Smale. “If you come from outside, you take the time to actually understand the consumer and challenge the norms; especially those that are taken for granted by the industry, but that are either unpalatable or frankly downright irritating, for the consumer. For example, having to find a store clerk to unlock the shaver case, or trying to enjoy yogurt when the only available options don’t fit with your preference for a high protein, lower sugar diet.”

More than a Marketing Consultant

An interim is not the same as a consultant, explained McGowan. Interims don’t just deliver a whitepaper or a presentation and then leave you to outsource the implementation. A fractional CMO, Fractional Chief Growth Officer, of Fractional Digital lead can set strategy, manage and train up the team, and work with the team to execute on that strategy.

“The strategy is only as valuable as the execution,” said McGowan. “So, being able to bring both of those to bear is I think the value that someone like us brings to bear.”

InterimExecs RED Team is an elite group of CEOs, CFOs, COOs, and CMOs who help organizations through turnaround, growth (merger, acquisitions, ERP/CRM implementation, process improvement), or absence of leadership. Learn more about InterimExecs RED Team at www.interimexecs.com/red-team or call +1 (847) 849-2800.

More Resources:
*The 6 Biggest Mistakes Companies Make
*How an Outsourced CMO Enables Business Growth and Builds Brand Power