This year’s marketing salaries survey, which has been compiled with the help of The Lloyd Group, shows a continuing pattern of recovery and higher pay rises. But a return to Eighties fever remains elusive. Helen Cooper is a research consultant

As the economy continues to improve, this year’s survey shows a marketing community that is continuing to grow in confidence. The effects of recession remain clearly evident, and while we are unlikely to see a return to the halcyon days of the late Eighties, our study reveals a greater stability.

With a new approach to operating policy, companies are adapting to the harsher economic climate. Indicators show that we are witnessing a steady recovery, and that the marketing industry’s outlook is generally one of optimism.

Across the industry, salaries have risen by 6.9 per cent. This is short of the record 10.6 per cent increase five years ago, but still twice the rate of national earnings’ growth (3.25 per cent, September), and twice the rate of inflation (3.2 per cent, October).

The rise represents a steady increase over last year’s 6.4 per cent increase, and the previous year’s 5.9 per cent rise. Only eight per cent of our sample had their salaries frozen, compared with 13 per cent two years ago. The marketing community expects pay rises in excess of inflation, and next year they have predicted a rise of 4.9 per cent, up on last year, but likely once again to be an under-estimate.

The biggest pay rises went to those below marketing director level, except for the most junior who gained 6.7 per cent. Marketing managers were awarded an average 7.1 per cent rise, with group product managers and senior product managers gaining 7.5 per cent and 7.1 per cent respectively.

The biggest increase went to product managers who received eight per cent. Employers are evidently seeking to protect their good middle management, retaining them for senior management roles.

The smallest pay rises went to marketing directors, with 6.6 per cent, and to managing directors, with 5.8 per cent. However, the rewards for being in the upper tenth of managing directors are greater. This group was awarded 7.9 per cent, presumably the reward for steering their company effectively through recession.

Past surveys reveal that it was once the norm for the highest earners to receive the largest pay increases; however, this is no longer the case. Apart from managing directors, only the upper decile of marketing managers and assistant product managers out-performed the average.

The difference, even so, is negligible (half one per cent in the case of assistant product managers). After years of recession, many will be thankful they are still on a payroll. The necessity to pay more than the going rate to those already on the highest salaries may no longer be critical.

The salary difference between the average and the high flier, however, remains considerable. The difference in salary between the best and the rest of marketing directors is a massive 85 per cent, with the average earning 53,381, but the high fliers approaching six-figure status with 99,210. The average senior product manager earns 27,825, but those in the top ten per cent command 39,333, which is nearly 30 per cent more than the average marketing manager. The same trend is witnessed at the most junior level, there being a 34 per cent difference between the average and the best.

Employers are aware of the long-term investment value of key players, and are prepared to maintain the financial incentive to lock into their top performers. Reward for excellence is evident when one looks at the reasons for a rise in salary.

For those going through the annual pay review, the increase is an average 5.9 per cent, but for those whose achievement has been recognised with an internal promotion, the reward is 12.5 per cent. Employers should take note, however, that the biggest salary rise goes to those who leave their company. This group receives 14.5 per cent. The employer should ensure they are rewarding their key players adequately or risk losing them elsewhere.

Fringe benefits have always been regarded as an important factor in staff retention, and the marketing community has been used to receiving a full range of benefits. The essential perk has always been the company car. However, for the first time in the 13 years we have been running this survey, this is not the case.

Health plans are the most widely available benefit, awarded to 66 per cent of respondents (down on last year’s 73 per cent). Sixty-three per cent of marketers drive a company car, with an average worth of 17,150 (512 more than last year’s average). This is a sharp drop on last year’s figure of 77 per cent, and on the 86 per cent who received one five years ago.

The provision of free petrol has also plummeted from 41 per cent last year to 30 per cent. Clearly managers are begining to think this form of benefit is not worth the extra tax. With car tax recently rising by 5 and petrol by 3.5p a litre, the extent of next year’s provision is a matter for conjecture. The number receiving a car loan is pegged at three per cent, while those receiving a car allowance is seven per cent, a rise of just one per cent.

Guaranteed bonuses are available to six per cent of respondents and worth less than performance-related bonuses, which are received by 51 per cent of our sample (both figures on a par with last year). These statistics reflect the philosophy behind the provision of benefits: that with less to go round, the greater benefits go on merit to the best performers and high achievers. Providing they hit target, 30 per cent of those on a performance-related bonus can win a bonus of at least 11 per cent. The same percentage of salary is available to just 19 per cent of those on a guaranteed bonus.

Twenty-six per cent benefit from profit sharing, a slight increase on last year. It is fairly evenly distributed throughout the marketing department, but is of greatest value to the most senior. It is worth a top-up of a third of salary to 18 per cent of managing directors, and to seven per cent of marketing directors. Share options are available to 31 per cent, a figure that has not changed over the past seven years.

With regard to pensions, 87 per cent of our sample are in a company pension scheme, compared with 91 per cent last year. Those fortunate to be in a non-contributory pension scheme have dropped by ten per cent to 21 per cent; those with a contributory pension number 66 per cent. Both types of scheme are operated evenly throughout the marketing department.

On average, 41 per cent of marketers have the advantage of a flexible benefits policy (37 per cent last year), and this rises to 60 per cent in larger companies with marketing departments of more than 100. Apart from the company car, marketers also obtain a greater range of perks by working in a large company. In departments of 100 or more, you are twice as likely to have a profit share or share option scheme than if you work in a department of less than 11.

Mortgages are available to 25 per cent of those in the largest departments, and relocation expenses to 43 per cent, compared with the average eight per cent and 26 per cent respectively. Club membership, creche facilities, discounts and company credit cards are all more prevalent in larger companies.

The provision of benefits has dropped slightly over the previous year. Six years ago, it was at its peak, very much a case of “jam today” for everybody. Now with margins ever tighter, the emphasis is on value for money and reward for excellence. If you’re not giving value for money, then don’t expect a handout.

Redundancy has become a commonplace feature of our corporate culture, as companies continue to rationalise. However, we are now witnessing a levelling out of this process, with 59 per cent working in companies where redundancy programmes have been implemented in the past 12 months. This figure is down for the third year running.

In the marketing department, the worst is over and we are now seeing positive signs of expansion. This year, 40 per cent report an increase in their department compared with 35 per cent last year, and the number reporting a reduction has dropped by three per cent to 25 per cent.

Marketing departments of all sizes have increased their headcount, for example 48 per cent of those in departments of more than 100 have reported growth, and 45 per cent of those in departments of between 11 and 20 staff.

A closer inspection of the tables reveals that growth is at an average of four, a similar pattern to the previous year when growth was 3.9. Decreases are also levelling out, and show that the marketing community is reaching a new stability. With an increasing number of marketers optimistic about their company’s growth prospects (66 per cent), the picture looks more rosy for the industry.

Job sharing is not a significant factor in departmental structure, with just six per cent of our respondents citing its presence. Not surprisingly, it features more commonly in larger companies, reported by nearly a quarter of those in departments with more than 100 staff.

As companies drive towards greater efficiency, operating policy is changing. Consequently, nearly half the respondents have been affected by restructuring in the past 12 months. The main change in operations – other than redundancy – is the introduction of category management. Thirty-eight per cent of our sample have seen category management implemented in the past five years, while 21 per cent have experienced it in the past year.

Last year’s survey showed it was more common in departments of more than 100. This year we are seeing a growth in the introduction of category management to departments of 11 and over.

Divesting of brands is also an influential factor in operational structure. Fourteen per cent have reported a reduction in their portfolio, with six per cent in the past year. Elsewhere, a change in management accounted for restructuring in five per cent of cases.

Advertising expenditure is dictated by the feeling of long-term confidence in the economy. It is a positive sign that advertising budgets have if anything marginally increased over the past year, despite corporate profits taking the strain.

Nineteen per cent of respondents work in departments where advertising expenditure exceeds 8m. In departments of over 100 staff, 76 per cent have budgets of this size, while even in departments of 21 to 30, one-third are in this big spending category. If the Government succeeds in restoring consumer confidence and boosts high street spending, we may well see a significant growth in ad spend next time round.

Against a backdrop of operational change, it is perhaps surprising to note that the best paid and the worst paid industries remain the same year on year.

Traditionally, the financial sector has paid salaries above the going rate, and this is still the case. What has become apparent, however, is that margins are narrowing. Five years ago, the difference between the average marketer and the financial marketer was twice as much as it is today. The financial sector also has the largest marketing departments, with over a third of departments having in excess of 76 staff working in finance.

The grocery and toiletry sectors have always paid well and offer the best returns for those in it for the money. The average salary of a marketing director is 53,381, but working in the grocery sector a marketing director can expect to earn on average 60,782. Likewise, at the most junior level, the average is 16,113, but in the grocery sector it is 17,603. The growing hi-tech sector representing 12 per cent of our sample (eight per cent last year) also pays above the norm.

Those working in the industrial and leisure sectors are unlikely to make their fortune in marketing; the trend here is still one of relatively low pay. A group product manager working in industry earns some 4,216 below the average rate for his or her job; while a product manager earning the average salary of 22,781 could expect only 20,200 in the leisure sector.

For the real discrepancies in remuneration we must look between the sexes. There is little doubt that it still pays to be a man in marketing. The wide gulf between male and female salaries remains, with men earning on average 38 per cent more than women. The overall average salary for a man is 35,212, with women trailing at 25,534. Only a quarter of men earn less than 25,000, compared with 56 per cent of women. Only four per cent of women earn more than 45,000 – unlike one-fifth of men.

Although the number of women in marketing has been increasing (45 per cent this year in contrast to 29 per cent in 1991), women are consistently worse off than their male colleagues at every level in the marketing department. At assistant product manager level, where there are two-and-a-half as many women as men, the difference between average salaries is 497 in favour of men. This difference widens with seniority; at marketing director level, the salary difference for the same job is 4,276, with men earning on average 54,236, and with only two women in the top ten per cent of earners at this level.

Women are a very much undervalued resource in marketing.

Inequality in salaries is underlined by the finding that men also enjoy more perks. At marketing manager level, 59 per cent of women receive a car against 78 per cent of men. At product manager level 47 per cent of men enjoy the rewards of a performance-related bonus compared with 38 per cent of women.

Evidence shows that a greater proportion of women are recruited at trainee level. At assistant product manager level, 72 per cent are women. Whether this number of women progress into senior posts remains to be seen. At senior product manager level, men have the edge with a 54 per cent presence.

The most senior management positions are still very much male dominated, with just nine per cent of managing directors being women. It may come as a surprise therefore to note that women rate both “opportunity for advancement”, and “challenging work”, more importantly than do men. It is also conspicuous that men are no more mobile than women.

Job mobility was fairly static in previous years, as many were content to hold on tight to their jobs and concentrate on survival. This year’s survey shows that job mobility is at its highest for some years, a sure sign that the marketing industry is regaining confidence, and breathing more easily again. Our 1992 survey showed just 17 per cent changing jobs, and 38 per cent hoping to. This year’s survey reveals that 50 per cent changed jobs (35 per cent with an internal promotion, 15 per cent at a new company), and 53 per cent are optimistically anticipating a move in the next year.

The prospect of moving to Europe is as popular as in previous years, with 63 per cent prepared to make the move (65 per cent five years ago). Equal willingness is shown by all levels of the marketing department, with product managers and group product managers being particularly keen to go (68 per cent). Despite this, only 13 per cent are sufficiently equipped to converse fluently with their Continental counterparts. This figure shows no improvement from five years ago. French is the most commonly spoken language with 41 per cent having at least a rudimentary knowledge, but only eight per cent speaking it fluently.

A growing self-confidence in ability is demonstrated by the 20 per cent who expect to be approached by a headhunter for their next job, although only ten per cent of marketers actually arrived in their current jobs in this way.

Recruitment consultancies are the most popular option for job-hunting, with 33 per cent expecting to find their next position in this way. Twenty-five per cent expect to find their next job advertised on the pages of the business press, and 18 per cent in the national press. Sixteen per cent are hoping to find their next job through a personal contact, suggesting that the “old boy” network still has relevance.

Career advancement is imperative to 92 per cent of respondents. However, the most motivating force is the challenge of work, with 98 per cent considering it important, and 63 per cent very important. Other key job characteristics are responsibility and recognition. The most senior in particular gain job satisfaction through the challenge of work and responsibility, while the under 27-year-olds are ambitious to take the first steps to advance their career. Financial reward is equally important to all ranks and age groups.

The “soft” job characteristics of friendly working environment, job security, location and good fringe benefits do not hold the same appeal for our respondents.

Security is not as critical as it was in the past two years, presumably because marketers do not feel as threatened in their jobs, and can look forward with optimism.

The marketing community will continue to be affected by overall economic conditions, and change is ongoing. The cold wind of recession has left its scar on the face of the marketing industry, but our survey shows there is a growing stability as companies have retrenched and adapted operational policy. Pay increases are rising and all the indications suggest marketers should enjoy a year of steady growth.

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