E-Commerce Speaks - Episode 4: Efficiency is Key - with Andy Culligan

Efficiency is Key - Short Summary

In this episode of E-Commerce Speaks, we talk with Andy Culligan, fractional CMO for a number of companies, and founder of AndyCulligan.com

We discuss what’s involved in being a fractional CMO, and the trend toward fractional C-level positions that has emerged over the past few years.

Discussions also include:

• Why a mid-market-level tool may serve your e-commerce company better than an enterprise-level tool
• How being a LinkedIn influencer can help your personal brand
• Focusing on efficiency and sustaining the right ratio of Customer Lifetime Value to Customer Acquisition Cost

Transcript of the episode

SAM
Hello, everyone. I am here with another episode of E-Commerce Speaks - with ROI Hunter. And today's guest is Andy Culligan, fractional CMO for a number of companies. Andy, thank you so much for being here today with us.

ANDY
No worries, Sam. Good to be on.

SAM
So what I wanted to talk to you about right away is this this position of fractional CMO that I mentioned. Can you tell me, first off, what is a fractional CMO?

ANDY
No. Yeah (laughs). Now so fractional CMO is, is basically somebody that has probably quite a few years of CMO experience and helps out organizations at certain stages, a certain stage organizations, so normally, sort of scale up stage organizations, to focus their marketing teams on the right things.

And they come in and work across a number of different, or- they work typically across a number of different companies. Right. It's not quite the same as a part time CMO, but a part time CMO would normally be somebody that would- or a contract CMO is something that I've been approached for before as well. 

“Hey, do you want to come in as a contract CMO?” Contract CMO would be like, “hey, you'd work full time for a limited amount of time.” So for three months there's something, right? Just while they try to find somebody to bring in. Fractional CMO would be, a fraction of your time is given towards numerous organizations at the same time. 

So I right now, for example, are working, am working in some form of capacity as a CMO in five different organizations. So leading the teams, making sure that the teams are focused on the right things, putting targets in place, making sure those targets are being met, aligning with the sales org, etc. etc. But it's only a fraction of my time versus doing a full time position. 

SAM
Now, in in the past, you'd held other senior level marketing positions. Would you say that being a fractional CMO is very similar? It's just doing it for a lot of different companies? Or is it like is it a lot more work being a CMO for another company, or is it just a lot more ways to fill your time when you're CMO for one company?

ANDY
Yeah, it's it's different, right? It's it’s hard like... yes and no. All right. So I've never actually gotten asked that question before. I haven’t given it a huge amount of thought. Right. But for me personally, I think it works really well for me, I'm just that type of personality that I can be spinning a lot of different plates and a lot of different things all at the same time and different getting different input from different channels all day, every day. Like the phone never stops. Like it's a lot of work. Right.

SAM
Oh I’m sure.

ANDY
So yeah, it's, it's a huge amount of work, but it and some days are really crazy busy. Some other days are not as busy. But like it's full on, right. Like I embrace that. I embrace the differences between different organizations and also taking some learnings over from one organization, putting it into another.

Like to go into your question, like, how is that sort of feasible? I was like, well, a lot of the stuff that I’d be implementing in one organization and stuff that I'm seeing there, I just copy and paste and put it into somewhere else, right?

SAM
Yeah.

ANDY
It's also important to note as well that I do very little of the heavy lifting myself. Like, there always needs to be a team on the ground. So that's why I said at a certain stage organization it makes sense. I typically get a I get a lot of inbound call me from complete start ups that will be like, “hey, we don't have any marketing resource. Can you come in and be our marketing resource?”

And I'm like, “well, I can bring in a marketing team,” which I also have with that other organization whereby it's me leading a team and we are essentially the external marketing team for that organization, but they don't want to pay for that, right? 

So I'm like, that's a you know, you're not going to get like and between like the four of us on that specific team, or five of us actually, you're getting like over a hundred years experience almost, right? So like it's and with, with a number of different like with so many different companies. 

Right. I think there's we did the math on it before. There was like between the five of us we'd worked sorry it wasn't a hundred year’s experience, it’s 70 years experience with over 100 organizations and 100 marketing teams. So like crazy amount of experience and across, I think it was 30 odd countries or something. Right, so like, like a crazy amount of experience. 

Now, if you go out and hire a full time team with all that experience, it's going to cost you a small fortune. Right. So like, what we do is we go, are we can we can come to you and basically have your marketing team overnight.

SAM
Mm hmm.

ANDY
But again, you- and it will be at a fraction of the cost of what it would be to hire that full time team. It's not a full time employee headcount. So seeing as you're not an FTE, that's also interesting to companies because it's something where it's very risk free for them. 

Like you can say to me between today and tomorrow, “hey, look, we're not interested anymore, we need to cut costs, or whatever.” And we won't be, we won't have any heartache about it, and we're also, we're contractors, so it's not, it's not that there's any laws or whatever that need to be abided to employment law whatever, right? So that makes it very interesting for organizations.

SAM
I think it makes, yeah, a lot of sense, particularly for the C-level positions. If you're at a company that's not necessarily enormous where you would need full time for it, but you need somebody to give some structure and some direction to it, it would make a lot of sense to bring it in. 

It's actually something I've been seeing with other leadership positions in organizations. You were you were the first person that I knew who took on a fractional CMO position, but I've now seen it with other C-level and similar senior positions where they have a fractional person who's working for a number of companies. 

Do you see this kind of thing as a growing trend or a blip or.

ANDY
Yeah, for sure. For sure. I see. So like I started, we can get into how I started the business in a minute, but, but when I first started, it was like... nobody was really doing the fractional CMO thing, as you mentioned, like, like there was a handful of people that I’d just sort of seen out and about, but it was no, it wasn't really a thing.

I think that's really after like like a lot of people now that I know, I’ve seen so many people just quit their jobs throughout like Q4 of last year and they've come up with X, Y, Z.com like first name, last name, dot com, you know, same as same as what I did like two and a half years ago, which is which is- shows me it's going in the right direction. Right.

Also like there have been other positions that are that are also like the  fractional positions like typically, and they're quite well known as fractional positions will be things like a CFO, like fractional CFO is one which is quite big. You've also got fractional Chief Product Officer roles, CTO roles and then you've also got things like in the design world, you have things like Creative Director roles and stuff like that that would be fractional as well, right?


So I think, I think- and also in HR, you know, fractional HR Leadership, or People Officers, right? So I think it's, it's really growing. Why it's growing is because, well, first of all, companies have been trying to cut costs over the past couple of years. So they've been trying to remove some of the headcount that they've had that has been expensive, right? 

And also at the same time, the funding drying up from private equity and venture capital means that companies don't have as much funding to be able to go and hire big guns, right? Which means that people that would be expecting a specific salary won't be able to get a specific salary by going and working for just one organization. Right?  

So if they share the burden… So they go across and work across a couple of different companies. And basically what you get is you get somebody that has the experience. And I think more and more companies nowadays are starting to be like, well, experience outweighs this like “we need to have them all the time and have them all on all the time.”

SAM
Yeah. 

ANDY
It's not necessary. Right? And yeah, that's essentially why it's working is a knock on effect of funding being cut, which means as well that they're not able to hire like heavier positions, right? But those people that come in and say “hey look I'll do it at a fraction of the cost, but you'll have the same amount of expertise. So, you know, let's do it.” 

It's... I don't think, I don't think, by the way, when you're in an organization, it lasts forever either. I think there's like an expiry point when you're in an organization.

SAM
Yeah.

ANDY
Like it's not just you come in and you’re a fractional CMO or a fractional C whatever, forever. I think you bring it up to a certain point where by now it's time for you to maybe bring in somebody full time. So you're helping them to set up the structure, get the wheels on, and then they can really take off once that's all fixed up and they're ready, budget wise and experience wise, to bring on a C-level like that.

SAM
Yeah.

ANDY
So most companies will actually have like a team that's there, right? They’ll have like teams that- the companies that I work with, I’m only going to work with companies that have teams, as I mentioned before, right? 

SAM
Yeah.

ANDY
So like they'll have a team that's in place. So somewhat of a structure is already there, but it's normally a mess and they don't know what way is up typically, right? So I just come in and just say, okay, this is what we should be focused on. This is what the marketing plans would typically look like. I work with the existing team to do that. 

Get aligned between the marketing and sales of course, like align ourselves to the… to the OKRs or KPIs for the organization. Like, well, what's the organization looking to achieve? How can marketing help achieve that? And I also sometimes as well take over the SDR teams, if they have an SDR team, or tele-sales team or internal sales, Whatever you call it. So yeah, that's it in a nutshell, I’d say.

SAM
That makes sense to me because I, in my experience working with B2B businesses or even speaking with people, working in ecommerce companies, having that person who knows the direction and comes in and can just point you in the right way is something that is so important and often so lacking. So I think that's a crucial part that you can play in as fractional CMO for a number of different places.

I, I also wanted to talk about the fact that you are, of all of my connections, personal life and professional, the most famous on LinkedIn of them. And I wanted to know, well, first off, do you do you consider yourself a LinkedIn influencer or am I behind the times on the terminology?

ANDY
I don't know, I don't know. Yeah, like, I guess so, yeah. So like in comparison to some others I don't have much of a following. But I have a relative… So all of my business has come from LinkedIn. 

So all of my like, the entire business that I’ve run. Like all of the, all of the revenue that I've received at this point in time has all come from LinkedIn, right? So I must be doing something right there, right?So I’m typically like... go ahead.

SAM
I was just going to ask, is it something that you were setting up consciously as a way to to further your own brand or you were… I see you shaking your head, what was, yeah, what was your initial motivation for setting up your LinkedIn presence.

ANDY
Well that was for setting up my own personal brand, like just for me personally, like I see it as a beneficial thing to do just for my career generally. It wasn't… I didn't set it up in mind being like, “hey, someday I'm going to be a fractional CMO, and then I'm going to need this as a channel for growth.”

I didn't, like, That would never that never have struck my mind. Actually, I became a functional CMO sort of by accident, so it wasn't really something that I had planned for. But. Yeah, I just started  doing it when I was a CMO at another organiz- a full time CMO at another organization. I'd sort of been doing it before that, but I really put an emphasis on doing it during that time, just because I thought it was fun and I was sort of enjoying it and.

SAM
Yeah, I like your posts, they have that good casual nature of I think most start with “Yo,” or “Hey,”

ANDY
Yeah.

SAM
Then just go straight to the point with it, which is good because I like that. Like it's like it's speaking with me. Whereas I feel like a lot of LinkedIn posts that I see are yelling at me, which is, which is much.

ANDY
Yeah, I like to call bullshit on things, you know, like, I just like I think people overcomplicate things just to make themselves sound important or clever. I don't like to do that because I don't, I don't consider myself particularly clever. I just think that I think I'm just very resourceful and just, like common sense normally prevails when it comes to things.

And I always, like I also have this thing for myself was like, if something, if you have a gut feeling, that's a gut feeling that something's not working, you're probably right. So follow your gut, right? And I follow my gut quite often, and it's normally led me to good spots. So, you know.

SAM
I wanted to ask you something that I've been asking a lot of our guests is how you like to keep up with the industry because you're involved with a lot of different companies, businesses. You've been involved with a lot of e-commerce companies in the past. When you're trying to learn something new or you're putting together research for an e-book or a webinar or a video, where do you like to go to get your information?

ANDY
So it depends, right? So if I'm doing.... Let's say for example, if I'm doing a webinar series like with an organization that I'm working with now, we're doing a webinar series and we're trying to come up with topics which are interesting to B2B sellers. 

In order for me to do that, what I'll do is I'll go look at what other people are talking about on LinkedIn and I'll figure out like what people are like, LinkedIn is a good resource for that because you've got those sales influence- B2B sales influencers,
so they're talking about X, Y, Z, and then you see which posts are resonating, which aren't typically like whatever simple wins in that space, like simple. 

And then you give actionable advice or feedback or whatever, right, to people, then that typically works well, right? Other places where I'd go and look what's happening in this industry and I'm not one for reading too much around like like I don’t know, Gartner or Forrester or anything like that per se. I would, I would a bit but I'd, I'd look at places like, let’s say, for example, in the e-commerce world, if you're interested in learning a bit more about where you should make some technology investments for example, or understand more about those companies or vendors that are coming to you and asking you or asking you to purchase from them. 

So like if you're looking to buy, for example, a marketing automation platform for e-commerce, I'd be going and looking at things like Capterra and G2 to understand what people are saying, what their customers are saying about those specific platforms, like that's right out of the that's right of the mouth of the customer. So I be to look at that and see also where they're being placed against the competition.

I will just give one caveat on that, is that there are some monsters that are on there, like huge, huge organizations like, for example, the Salesforce Marketing Clouds of this world. That are going to have thousands and thousands of reviews, right? Or HubSpot or whatever. They're going to have so many more reviews than the smaller, smaller, maybe mid-market players. But you should go and have a look at those mid-market players because they're typically the scrappier ones that will be able to be more agile for you as an organization in e-commerce. Right?

So I've worked on the vendor side across numerous marketing automation platforms that serve into the e-commerce space I'm currently working with one at the moment, I'll give them a quick plug, called Xtremepush. Not “ex,” so “X-t-r-e-m-e-push.”  Yeah, that offer a CDP with omnichannel capabilities, but they like from the level of service that they can offer. Their customer base is far super- is far superior to what some of the other like larger cloud platforms could offer because their customers are so important to them that if they lose a handful, then that's going to hurt the business massively, right?

And we experience the same Sam, you and I working in other organizations, similar organizations, right? And I've worked at a couple of those types of organizations whereby if they're operating within that mid-market space and they're one of those scale up companies rather than an enterprise monster of an organization, you can be pretty sure that the level of service is going to be far superior. 

And also actually the technology itself, you should look into whatever companies you're looking at, see if those technologies were acquired technologies and then tried to be plugged together rather than like… That's my least preferred if you're talking to me, if I'm an e-commerce buyer, I'd be more preferred about something that's been built rather than bought.

SAM
Okay.

ANDY
So if you go built, not bought, you can be pretty sure that all of the tools and technology is going to talk to one another. So for example, if you're talking about a CDP (customer data platform), that's also got execution, for example, email or push notifications, SMS, whatever web and all of that has been plugged together via, via various acquisitions, then I think you're going to be you can be pretty certain that it's going to be a bit clunky when it comes to everything talking to one another.

SAM
And people that were there developing it might not still be there because they didn't bring in everyone in from the acquisitions.

ANDY
Exactly.

SAM
I like what you're saying about the mid-market, smaller organizations because like you said, they care more for their customers because they have not this huge number there. They want to take care of the ones they have. And in terms of the technology, they're also the ones that that tend to be more willing to work with you to customize it for your purposes. Whereas enterprise might have their own things set up or, like you said, an amalgam of all these different technologies and not be able to really be as flexible with it.

ANDY
100%. 100%.

SAM
Andy, the last thing that I wanted to get into with you is just if you as someone who has worked with e-commerce companies, businesses that work with businesses and everything across the spectrum in a number of senior roles, a lot of our listeners are e-commerce based, is there any advice that you would give to them?

ANDY
Yeah, I think, look, everybody knows that at the minute, like efficiency is really important. We spoke before about funding drying up, right, so there's there's less money floating around to just go grow at all costs. I think that's affected everything like we spoke before this as well Sam, things like interest rates etc. also being something that's been exploding.

Also, I think we've seen we've seen like during COVID or just after COVID, we've seen this like massive rush of sugar into the e-commerce space. And that was like, oh my God, this is unbelievable. There's like ten Black Fridays in a week, right? But that's after dying off now and it's after it's after dropping back down to where it was before. So like, people got geared up with massive influx of orders and being like, “this is awesome, but we need to sustain that now.” And then they've put themselves under pressure to be able to sustain the amount of incoming that was coming in.

For example, I know a very reputable brand. I'm not going to say which brand, but they make bikes, okay, kids’ bikes. And they, they grew rapidly during COVID, like enormously. And so much so that they were like, “we need to open up more manufacturing, because we cannot meet the demand,” right? So they couldn't meet the demand. 

So what they did was they went out and opened up new factories and made sure that like they were able to, able to meet that demand. Well, hey, guess what? By opening up more factories, the quality of what they were able to offer went down. And also the market demand went down at the same time because they ended up saturating the market. 

And now they have all these factories… Now they have these factories that they had to close, and they've had to let people go. And that's been a costly exercise for the business, clearly. And at the same time, their brand reputation is diminished as well because the quality of what they were offering decreased because they were so focused on growth rather than just maintaining and staying sustainable, that it hurt them. 

So like that's... that’s nice to say in hindsight now, but advice to any e-commerce in the future, if I was running an e-commerce, I'd be like, “how do I grow this thing
sustainably and profitably,” right? So like, and that should always be the way that a business should be run, by the way. 

We've just gotten into this, into this mindset of grow at all cost because it's been fueled by VCs and private equity. There's just been so much money floating around just being like, “go sell, sell, sell, sell, sell. We'll worry about the consequences afterwards,” which is a really shitty way of doing business because it ends up in a crash at the end of it. That's what happened with the dot com burst back in the early... in 2000. Right. In that an external event, right, happened where people panicked and didn't buy or there was a there was an external event where people were not giving anymore equity. 

And then what happened was there were all these companies that were there one day, which lost all of their funding because there was there was a downturn and nobody was able to purchase it from them, so the whole thing just went burst, right? So I would say the companies that I work with nowadays as well, the ones that are most focused on profitability, are the ones that have the most likelihood of survival.

SAM
That is… honestly, exactly what we've been seeing with our own clients and what our other guests have been talking about is it's a time to focus in on profit. Now, growth is is great, but only if it's sustainable because right now we don't have the the interest rates at the levels where people are going to be willing to fund your growth for forever as they were before.

ANDY
Yeah, and look at your efficiency metrics, look at like your LTV to CAC, [Customer Lifetime Value to Customer Acquisition Cost] like understand what your LTV to CAC is, like. I see this even in volume SaaS businesses now as well. They're really, really focused on LTV to CAC. To understand, okay, are we, are we managing to do a 3 to 1 ratio on LTV to CAC across all of our different channels?

So you'd be looking into individual teams and channels of different initiatives to see if you hit it in that 3 to 1, 3 to 1 being, “hey, I'm operating efficiently,” meaning for every dollar that I spend I’m getting 3 back. Right? And then if you're if you're doing that across all of your different channels, if you have a 5 to 1 somewhere, you know that you can invest more money into that specific channel and you've got more efficiency to be gained.

Whereas in another channel if you’re doing a 1 to 1, it’d be a question like, why are you doing it? Is it just a vanity metric?

SAM
It’s not worth your investment.

ANDY
Exactly, Exactly. So that's something that I'd be focused on, Yeah?

SAM
Perfect. Well, Andy, thank you so much for joining us to give you a quick plug at the end there.I know you have your own podcast as well, This is Your Captain Speaking. So if anyone else is looking for another great podcast, anything you wanted to say on that one?

ANDY
Yeah, I run that for a company called Marmind and it's called This Is Your Captain Speaking. We've got interesting guests on from all walks of life in marketing. We just shoot the shit, basically about marketing for 20 minutes for whatever similar to this, was a bit of fun. So yeah, you can find that on Spotify and you can find me on AndyCulligan.com

If you have any questions, just come to my website, or on LinkedIn. Andy Culligan on LinkedIn.

SAM
Thank you so much for joining us and I'll chat with you soon. 

ANDY
Thanks Sam.