Fractional Futures

Building a Marketing Strategy Aligned with Business Goals

• Paul Mills • Season 3 • Episode 3

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Fractional Futures is the essential podcast for CEOs, investors, and senior marketing executives looking to unlock the power of fractional marketing leadership.
 
Hosted by Paul Mills, Founder at VCMO, and with special guests, we'll share expert insights, provide actionable strategies and explore real-world success stories to help you leverage fractional marketing leadership for maximum impact.

In this episode

In this episode of Fractional Futures, Paul Mills and Rob Nicholls discuss the vital role of fractional CMOs in aligning marketing strategies with business growth objectives. They explore the importance of communication between CFOs and CMOs, the necessity of integrating marketing into strategic planning, and the potential of AI and research in enhancing marketing insights. The conversation emphasizes the need for credibility, relationship-building, and understanding internal clients' needs to drive effective marketing strategies.

Special Guest

Rob Nicholls, Founder Rob Nicholls Consulting, CFO, Board Advisor and Angel Investor.

Key Takeaways

  • Fractional CMOs can significantly impact SMEs and portfolio companies.
  • Alignment between marketing and business growth is crucial for success.
  • CFOs often act as conduits between marketing and other departments.
  • CMOs must build credibility within the organization and the market.
  • Networking and community engagement are essential for CMOs.
  • Research and insights should be owned by the marketing lead.
  • Generative AI can enhance marketing strategies and insights.
  • CMOs should be involved in the strategic planning process.
  • Understanding internal clients' pain points is vital for marketers.
  • Building strong relationships can lead to greater marketing influence.

Sound Bites

"CFOs and CMOs need to speak the same language."

"CMOs must own market research insights."

"Generative AI can be a marketer's best friend."

Contact VCMO

Thanks for listening & keep podcasting!

Fractional Marketing Leadership | Marketing Transformed.

Paul Mills (00:01.806)

Hello and welcome to season three of Fractional Futures where in this season we're diving into how fractional CMOs can help SMEs and portfolio companies scale and maximize enterprise value. Joining me across these episodes is Rob Nicholls, a seasoned CFO, a non-exec director and board advisor with over 35 years of global finance expertise.

 

Rob specializes in profit maximization and value creation, and I'm delighted to welcome him to the show today. Hi Rob, how are you doing?

 

Rob Nicholls (00:33.536)

Good to see you Paul yeah do very well do very well

 

Paul Mills (00:36.174)

Good stuff, what you've been up to since we spoke last.

 

Rob Nicholls (00:39.357)

Bit of golf, bit of golf, looks like you've been having a haircut as well. Sit till you're lost.

 

Paul Mills (00:42.742)

Yeah, thanks for mentioning that. was trying to use my headphones to disguise the... I asked for a little bit off the top and I got decapitated, I think it's fair to say. So good old Turkish barbers in Bridgewater.

 

Rob Nicholls (00:52.605)

There you go. I always go in and ask him to cut out the grey hairs and just keep the brown. Doesn't seem to work.

 

Paul Mills (01:00.046)

Good stuff. So Rob, in this show, we're going to be talking about aligning marketing objectives with growth goals, the growth objectives of an organization and how the CMO, how the CFO, how investors need to have a joined up conversation about how that all happens.

 

I guess for marketing to drive real business impact, has to be, the activities have to be aligned with the company's growth objectives and the investment goals or the investment thesis. Often, and we spoke about this in the last episodes, the marketer and the CFO, they perhaps speak different languages and we need to sort of break down those barriers to make sure we can all get aligned. So Rob, how...

 

With your CFO hat on, I guess with your investor hat as well, how do you work effectively with the CMO to align marketing objectives and marketing activities with the business growth and investment timelines?

 

Rob Nicholls (02:12.039)

So on this, I think this is an important link to the board, if you will, here, because oftentimes the CMO or the lead on marketing is not in the board, on the board. So really, they're not party to the discussions the board is having with the CFO and the CEO. So I look to an extent that the CFO is gonna be, to a large extent, the conduit into other parts of the organization.

 

Now clearly the CEO will impart the knowledge of what they want from the marketing lead. But again, it's the perspective that you want to build a relationship with the CFO because the CFO should be guiding a lot of the conversations that are being had within the organization to ensure, good word here, is alignment of the objective. Because if you're not aligned, if you're not shooting in the direction that the board and the CEO and the CFO want,

 

you're not going to get credibility and you're not going to get the support. And more often than not, you're going to need the marketing manager, the CRO, the CMO is going to need the support of the board. And you're not going to carry that if you're going off in a certain direction, doing certain things, looking at certain market opportunities that the board is not consistent with. again, it comes back to critical word alignment, but it also goes to the relationship

 

as well and having a conversation. I think I mentioned previously, know, most of the companies that I work with don't have a permanent in-house marketing lead other than a relatively junior person. So they don't have, I think in one case I have one CMO, but that the conversations I'm having with that person probably more often than any other person in the organization. That's a 50 person company and there is a CMO in there.

 

And so, you know, lot of the conversation is me imparting my thoughts to them and them bouncing ideas off of me such that I will say, well, you don't want to do more of that, but if I were you, I'd be looking to do more of that. And I think that's cognizant with, you know, building brand, gaining more revenue, gaining more credibility. And I think credibility is a big part of this as well. The marketing lead has to have credibility,

 

Rob Nicholls (04:35.547)

not just within the organization, but with the CEO, the CFO and the board and in the marketplace itself. I have one CMO that is extremely well known in the region that I operate in. And often people will say, you work with such and such, he is a good guy. And he's well known, he's well liked, he's well thought of, he's got his finger on the pulse where the business is going, what...

 

troubles are coming up what problems where people are moving to they're well engaged and and I think it goes to another thing is is the network effect here as well if your CMO is not connected with the wider Community the wider business environment. They're to be less influential less impactful So I often look for my marketing leads to be out there talking to people going to events going to networking events go to conferences

 

They have to be out there. You cannot be a CMO or a marketing lead in an organization that's trying to scale rapidly if you're not known, if you're not liked in the wider community and you don't know what's going on out there. What are people saying? What are people fearful of? What are other companies doing? Are they starting a podcast? Have they got a new blog? Are they working with a new agency?

 

What is going on? And I, for one, rely on the marketing person informing me what they're coming across out there, what the opportunity is, is a certain contractor moving into a certain region? Are they moving into a certain business that we are already in? And we need to be cognizant of that. So you need to be connected. You need to have a network and you need to have credibility

 

outside the business as well as within the business, I think.

 

Paul Mills (06:29.814)

And we, in a previous episode, we've been poking the proverbial bear. We've been poking the marketer a little bit. Maybe, I think we've been justified in asking marketers to put a mirror in front of them and maybe reflecting on their capability and their role in driving growth in organizations. I'm gonna wave the flag a little bit here for marketers. As being a marketing myself,

 

And I've seen this and I've experienced this both as an in-house marketer and I've seen where I've been mentoring senior marketing leaders in organizations. I've seen that the marketing strategy has to be grounded in realistic growth targets. Now you mentioned there that quite often in many businesses that the CMO or the marketing lead is absent from board discussions or the senior leadership team meetings.

 

And so what sometimes happens, I've seen this often, is the CFO will work with the CEO, they'll look at last year's sales performance, and they say, right, what we want to do is we want to do it at least 10 % more than we did last year in the new financial year. And that might be an easy thing to say on paper.

 

But when it comes to sharing that information with the marketing and saying, actually, you've got to find 10 % growth or support 10 % growth for the organization, but you can do it with the same level of budget or maybe less budget. How does that happen? Because I know a lot of marketers get really frustrated by this. How do you sort of counter that challenge? I guess?

 

Rob Nicholls (08:15.677)

So that is a risk that the sales forecast will be determined by the CEO and the CFO and 10 % is not cutting it with me, Paul. It's going to have to be 30 % for a start. The other thing is it's not going to be a bottoms up process. We're not going to build it by business, by numbers of customers, by the revenue generated per customer, multiple and by 12 months of the year, it's not going to be a bottoms up.

 

The likelihood is if you did a million last year, you're going to want to do, I'm going to want you to do a million three. The CEO might say a million two and the marketing manager might say a million one. Well, you know, someone's going to win and likely is not, it's going to be the CFO and the board and they're going to put a 1.3 million pound target on you and you're going to have to figure out how to do it. Like you said, likely is not with, with not 10%, not 15%, not 20 % extra resources would likely

 

5 % more. So you're to have to be smart. You're going to have to leverage existing content. You know that I post on LinkedIn every day. Well, I don't come up with a new post every day. I'm leveraging existing content quite often. So you're to have to get smart. You're going to have to use technology as well. AI could probably either replace marketing or be its best friend. if you're not

 

utilizing AI, generative AI to generate insights, market knowledge, whether it's copywriting, but equally research, research where the market is going, where are other companies going? Where is the marketplace going that you operate and serve in? That's relatively easy to find that out today. know, within an hour, I can have a report on the CEO's desk of what the opportunity is, and you should, as the marketing manager, be able to do that as well.

 

No longer, know, Research should not be an issue in terms of the opportunity. It is today because nowhere near enough businesses are generating research insights. Nobody's doing research unless you're asked specifically research that nobody's doing objectively trying to understand what the opportunity two, three, five years down the road is where, what countries people come to me all the time.

 

Rob Nicholls (10:42.553)

Where should we be expanding to? Well, you they look at Germany, France, the US. You can't look upon it like that. You need to look at specific markets for your specific industry for your specific product. So it might be better that you look at markets like California, Dubai and Singapore, rather than Spain, France and Germany. The market opportunity is better, but it has to be based in fact, based on research. And that's something the marketing officer

 

must own because I'm not going to own it. I'm going to expect you to generate that research, whether it's insights from organizations like Beau hurst or wherever it may be. You need to be putting that insight in front of me and leveraging that for the business and telling me things that I don't know. Don't tell me things I don't already know. Tell me things that I need to know to do my job better to inform the board.

 

So get ahead of the game. And those insights, think sadly are largely lacking to a large extent today, but it's at your fingertips. You've got available to you. You should be providing these one page summaries once a week, once a month, insight to the board. It's readily available and largely free. And the CMO, I think, has to own that.

 

Paul Mills (12:05.102)

Yeah, think you're totally right. you mentioned Beauhurst there. I remember having to ask the CFO for extra budget to afford to the Beauhurst reports. I know they're quite pricey. They are fantastic reports. But you mentioned AI there, Rob. And you can use AI with the usual caveats that apply. if marketers can get a good grasp of how to use AI safely, but strategically,

 

and create prompts that are well programmed, that have a very strong ICP, ideal client persona factored in. You can generate quite a lot of inference and insights from these GPT engines on consumer behaviors, insights, trends, and it can be global as well. And yes, you have to...

 

Be careful with how accurate the data is if you're purely relying on AI, but you can validate that with other information that exists in the market. You can benchmark it against other resources. So it shouldn't be an excuse anymore that there was a prospect that I was introduced to and they were an IT organization and the founder developed some really clever software.

 

It was very clever. looked very sexy. It was a very nice shiny toy, but he did no market research. And he said to me, I've got this great product here and no one buys it. No one wants it. And I said, did you do any research? And he said, no. And he actually invested 150 K of his own money and friends and family and bank loans and credit cards and God knows what a lot of money put himself at some sort of, you know, a degree of risk there.

 

Rob Nicholls (13:52.689)

Mm-hmm.

 

Paul Mills (13:59.838)

And he plowed all that money into developing this product without any attempts to do any research. He was a great engineer. He developed something that looks at face value, very clever and very slick, but there was no value in it. And had he spent three or £4,000 perhaps on doing some research, he could have actually taken the product in a completely different direction where there was traction for it and demand. So I think you're absolutely right. Organizations that

 

don't put enough focus on doing the right level research, they're going to struggle. They could fail or they could certainly see depleted sales revenues going forwards.

 

Rob Nicholls (14:41.309)

And it's certainly something that we used to do a lot more of going back two or three decades. We would have weighty research, weighty strategic research being done by the chief marketing officer. It's largely not done today. And that is a real, it's a risk. And it's a shortfall that probably should be addressed. And I'm a big believer in that, you know, generative AI.

 

It's a bit like me. My sales force used to refer to me as being either their best friend or their worst nightmare. And I think generative AI could be the same thing to marketing. It could be marketers best friend, or it could be their worst nightmare.

 

Paul Mills (15:23.694)

And as a CFO, if I come to you as a CMO or a fractional CMO and I provide you a pack of insight, how do you receive that information? How do you do your own due diligence on, can I trust this information or not? How do you as a CFO get under the skin of those insights from which to base your own decisions on whether you should follow it or not?

 

Rob Nicholls (15:49.629)

So two things is straight off the bat, I will do my own research. I will do my own research to basically either support or reject what someone's coming to me for. The other thing is that it goes to relationship as well. If I like you as a CMO or a marketing person, CRO or business development person, I'm be more inclined to consider it objectively. Equally, I say I'm gonna do my own research as well, but relationship is a big part of it.

 

I'm a big believer in investment in the business to move the business forward. I'm going to, if you're going to come in to me and say, I want to spend a hundred thousand pounds building on the brand that we've got in the marketplace, I'm going to be like, yeah, go for it. Absolutely. We need to do that because I think there's inherent value in those intangible assets that you're looking to create and that the business will be better off if we do spend X amount of dollars on that. So.

 

I am as a CFO going to be open to that. I'm not going to be the person that says, no, no, no, not going to happen. You're going to get an opportunity to pitch to me, pitch to the CEO and the board if necessary, but I'm not going to rain on your parade. I'm going to support you more than likely, unless it's a piss poor idea, in which case I'll tell you it's a piss poor idea, but equally you're going to get my support. And if it is,

 

brand building, it's strategic, if it's backed up by good research that you've done or that a third party has done, better, more so the better. I worked, when I was in the US, we used to work with a lot of the universities. We would literally put a piece of work out to a couple of university professors, they'd get a couple of their PhD students to work on it, and it would be good quality empirical research that's done independent of the business. Now, it has to be a substantial piece of

 

Well, it has to be generally a substantial business opportunity, but there are marketing people, there are young people in universities that would love an opportunity to do a piece of market research for you through the summer or the winter period. You should be doing that. You should be taking their research and applying it. So, you know, that's a relatively low cost way of generating empirical research that's got quality. Get somebody else to do it, outsource it.

 

Rob Nicholls (18:08.451)

use general AI if you need to, But you need to get your marketing manager in line with the CFO and what the CFO is thinking, talking the same language, having credibility in the marketplace. You know, and if I say to you, Paul, I think you should do more of this. I would strongly recommend you do more of this and less of that because that's going to build the relationship. And I'm going to be much more amenable to receiving. If you say to me.

 

we need to invest in a fleet of 12 vehicles to go and do remedial work on client whatever. I'm going to be more inclined to say, yeah, I think we should. Or another one of my clients wanting to invest in half a dozen drones so that they could do site surveys. And I'm like, yeah, that sounds like a value added service that our clients would value. Can we price it accordingly? Can we add it as a value, a line item, drone service, thousand pound a month?

 

Can we generate revenue opportunities from that? So if you're gonna do the research that might lead to revenue generating opportunities or margin expansion or pricing opportunities, I'm gonna be all over that and I'm gonna support you to do that.

 

Paul Mills (19:21.698)

Fantastic. And I think That kind of ties nicely into the next topic really, integrating marketing into business planning. Now, quite often in many organizations, the marketing leads will be not completely absent from the planning process, but it'd be mostly a process led by the CEO, CFO. It'd be those two protagonists that will...

 

look at the numbers, they'll look at where they want to take the business. And what often happens is that a piece of work is done by the CEO and CFO. And then the marketing lead is told, right, this is where we want you to go. this year or next year, whenever it may be. And there's your budget. Can you come up with a plan of how you're going to do that? And invariably what happens is the marketing plan you get

 

It's just a plan of activities. There's nothing really strategic in there. And I think certainly where a lot of companies where they may miss an opportunity is not including the marketing lead in that sort of triumvirate of CEO, CFO, CMO to develop that plan. Because the marketing person is basically the person who owns the market or the customer. And so by

 

Bypassing that knowledge and expertise, you might have a slightly myopic or a skewed business strategy. So how can you, what can businesses do to include the CMO or the fractional CMO or the CRO at that very early phase of developing the business strategy going forward? I believe very strongly that the marketing strategy should be the business strategy and

 

the functional areas of the business feed into that to say, right, how are we going to support the marketing to reach the customer, to increase the demands, to improve customer satisfaction, to maintain retention and loyalty, blah, Slightly controversial, but what's your thoughts on that?

 

Rob Nicholls (21:29.981)

So I am guilty of this. I am guilty and in fact I often I am the one that writes the strategic plan for the business and then the CEO will say yeah that looks good Rob. I am guilty of not including other persons within the business whether that's operations or supply chain production or sales or marketing. I think a lot of it goes to the credibility within the organization. If I believe that you as the CMO

 

can add significant value to what I'm doing around the strategic plan, then I'm going to include you. If I think you're a complete idiot, I'm not. Now, with all due respect, I think I would include the CMO generally. I did a strategic plan for a surveying client last year. The CEO and myself basically put the whole thing together. We didn't even involve the, in this case, the business development director.

 

So we determined what activities were going to happen. We had a high level five-year financial forecast that talked to the number of dollars we were going to put into the marketing PR consulting bucket, if you will. And you're going to give them a certain amount of money on a monthly basis to do the activities we see necessary to support the revenue goals. So a lot of it comes to credit credibility within the organization. I think the board will likely expect

 

that the CMO or the marketing lead will have had significant impact input into that plan. And so especially if there is a marketing or business development salesperson on the board, they would expect that. If there isn't that person, it's down to the CFO and the CEO to ensure we do include the marketing lead because they are insightful. They do know what the opportunity is. They do know the risks. They do know the competitors.

 

They do know what pricing works and what doesn't work generally. you know, Sometimes you have to force your way into that process. You know, my business development person didn't say, Rob, Rob, I need to submit the marketing piece for the strategic plan. We basically just determined it ourselves. And I will often go off and I'm often charged by the CEO to develop the strategic plan because finance has become this be all behemoth.

 

Rob Nicholls (23:58.257)

that has scooped up everything, whether it's HR, IT, facilities, supply management, production, whatever it is, and fortunately not marketing yet. But there is an expectation that the CFO will become this aggregator of everything. And I will often look to pass pieces out, like here's the marketing piece of the strategic plan, what do you think? What am I missing?

 

Maybe it's more the tactical pieces that I'm missing. Maybe it's also more a market segment that I might perhaps missing out on but it goes to credibility I think Paul if you have credibility in the community in the business environment in the organization in the business itself and the CEO and the CFO like you You're gonna get involved in that process and it's very valuable that you are involved in that process and that it's not

 

Paul here's a million pounds this year spend it wisely and we expect 12 million pounds worth of sales as a result. It's not a very good wicket to be playing on is it?

 

Paul Mills (25:05.298)

Absolutely right. I think marketing leaders need to transition from being famous for being known as the colouring department, or holding the crayons. I know you wouldn't, but I know a lot of other business leaders that might. They need to move from that kind of that badge to becoming trusted growth advisors within the business. And I think you're absolutely right. I think those

 

Rob Nicholls (25:19.003)

I would never say that, I would never say that, will you know me?

 

Rob Nicholls (25:29.917)

Hmm.

 

Paul Mills (25:33.794)

highly commercial marketing leaders that can understand how profit and loss works. They can speak the language of the CFO. They can talk in terms of value accretion, enterprise value, revenue, profitability, all those kind of good things, but also advise the CFO and the CEO on where are the opportunities, where are the new opportunities in the market that we should be looking at at the very least or

 

where should we be pointing our market research, whether it's looking at those opportunities or mitigating any threats that we've just uncovered in the marketplace. And also, you know, taking that internal look at the capability of the organization saying, right, where are our strengths? What business strengths do we have that are contributing to competitive advantage? And what are the areas of weakness that actually, if we resolve one or two areas,

 

That's going to mitigate our weaknesses. Actually, they'll turn them into a competitive strength. It just makes us more competitive as an organization. If you can manage that kind of level of dialogue and not just be seen as, the department that can jazz up a PowerPoint or they're doing another jolly or they're setting up in another event, that's a much more powerful leverage to hold as a marketer to win back that influence at the board level.

 

Rob Nicholls (26:56.409)

I agree totally. mean, it's engagement, it's being part of the team, the senior leadership team, even if it's not on the board, being party and providing that value added service, the objective service, that's what's really highly valued and to a large extent, it is kind of missing to a large extent today. And that's where I think the opportunity is for the CMO, the marketing lead to move up the value chain within the organization and provide that insight. Absolutely agree.

 

Paul Mills (27:25.398)

Yeah. And I believe very strongly a lot of marketers, they are very good at developing the ICP, the ideal customer profile, client profile, whatever vernacular you want to use, but very few are good at or even bother with the, what I call the other ICP, which is the internal client persona. I think the best marketers, the best marketing leaders, they need those internal ICPs for the CFO.

 

for the CEO for sales as well, because they need to be treated in the same way as a customer or a client. You need to understand what the pain points of those protagonists are. You need to understand what value you can add as a marketer to those protagonists on the board level. And really it's about working in that sort of, it's about delighting that internal customer. And I think if you can do that, if you can win that trust, you can win that respect.

 

with that credibility, then you're going to create some magic in the organisation that you're sort of helping to build.

 

Rob Nicholls (28:31.037)

Yeah, I absolutely agree. And you're going to create value in the organization and therefore you're going to become more valued in the organization. I come back to a lot of it, it's relationships, it's alignment, it's being known as being in the community, in the business environment, in the industry, becoming known and respected. And you'll get the respect within the organization and therein create additional value.

 

Paul Mills (28:56.81)

And that's on that point it's probably a good place to close the show. So If you've been listening or watching this episode, I hope you found value from our discussion. In the next episode, Rob and I will be discussing how to scale customer acquisition and retention. So stay tuned for that one. Rob, thank you very much for giving up your time today and keeping yourself away from the golf course to record this show. I hope you've enjoyed it. I've really enjoyed listening to your perspectives. And I look forward to the next episode.

 

Rob Nicholls (29:27.057)

Pleasure. Thanks very much, Paul.

 

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Paul Mills

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Rob Nicholls

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