The new and improved 1999 Marketing Week/Ball & Hoolahan Salary Survey shows marketers’ confidence is at its highest level in recent times. Marketers’ concerns over recession are minimal, there have been significant increases in average salaries this year, and confidence is high. Most are more committed to job challenge and financial reward than job security and believe they will change jobs and companies by the year 2000. This is not just bravado, but a reflection of the scarcity of good marketing skills.
After three years of relative prosperity and 18 months after Labour came to power, marketers have enjoyed significant salary increases. With the Government inflation target at about 2.5 per cent, marketers on average have gained salary increases of 9.1 per cent. But can this situation continue?
While marketers are relatively cautious about possible salary increases for 1999, they are bullish about moving jobs and indeed companies in the next 12 to 24 months.
This is a sign that good marketers with the right skills who can create revenue growth are in short supply, particularly at the junior levels of assistant brand manager, brand manager and senior brand manager. It is no surprise that these roles saw average increases of almost 11 per cent.
The average marketing director earns 57,677. The very top performers are now earning well over 100,000. While the average salary for individuals with five years’ experience is 30,000, high-fliers can earn over 50,000.
A slight improvement in women’s salaries vis–vis their male counterparts is evident, particularly at the junior levels, but not one female respondent earned over 70,000 and the gulf between the two genders remains significant.
Although marketers are in demand, they do not expect something for nothing. They are competitive and willing to be accountable, with 80 per cent saying that performance-related bonuses are important or very important. However, if marketers cannot get the salaries and the rewards they want, they are prepared to move to get them – about 50 per cent of the survey indicated a willingness to move jobs in the next 12 months and to move company within two years.
This combination of scarce marketing skills and a bullish approach by today’s marketers, suggests that the real issue for companies in 1999 is not the impending recession, but the continuing challenge of acquiring and retaining quality marketers. This means it is important for companies to understand marketers’ motivations.
The average marketer, as the survey reveals, is not a complex animal. Confident and ambitious, he or she is motivated by job challenge and financial reward and expected a minimum range of benefits, including performance-related bonuses. Job security does not appear to be an issue. The question arises whether this confidence is misplaced; but certainly the marketers in this survey did not appear troubled by this. Companies that retain their marketers understand that salary increases should not simply be aligned with expectations.
As noted above, average salary increases in 1998 were 9.1 per cent, well ahead of the estimated 6.3 per cent and the 1997 increase of 7.1 per cent.
Most marketers secured an increase of over five per cent, twice the Government’s target for price inflation, and over one third of marketers secured over ten per cent increases in 1998. It is interesting to note that the annual pay increase, introduced to ensure that pay kept pace with costs during periods of high inflation, has retained its importance in this less inflationary era. Seven out of every ten salary increases are due to the annual pay review.
The biggest increases are at the most junior levels of assistant brand manager, brand manager and senior brand manager, although even the increases at marketing director level are over eight per cent.
The glass ceiling for women seems to be rising, albeit very slowly. Women increased their salaries by 9.3 per cent on average, which is slightly more than the men, who had an average 8.9 per cent increase.
Expectations are the biggest single indicator of the opportunities ahead for the best people in marketing. Sixty per cent of respondents expect their salaries to increase by five per cent or more.
A staggering 47 per cent of all respondents believe that their company will not be able to provide the remuneration they will expect in the next two years and will have to change company. Senior people were more likely to feel that their company could fulfil their needs. Given that salary is important/very important to all marketers, these high expectations will cause market fluidity.
Different companies and sectors set varying levels of average salary. For example, the survey shows that if a high salary is a marketer’s goal, the sectors to join are financial services, grocery and information technology. Toiletries, pharmaceutical services and media also pay over the odds for certain roles, reflecting scarcity at certain levels. US companies also remunerate at a higher level: an average of seven per cent higher across the board.
The survey shows that the positions to which most people aspire – marketing directors and marketing managers – are those with the largest variance between average and top percentiles, while senior product managers and product managers appear to be relatively closely aligned. A more detailed analysis of the number of years spent in marketing shows huge variances also occur at the typical senior product manager and product manager levels (five to six and three to four years respectively).
It is clear that the highest salaries are paid to those managing the largest budgets. For example, the average salary of a marketing director is 57,677, but if the marketing budget is 5m and above it rises to 65,785 and if the budget is over 25m, the average salary is 70,777.
The survey shows that at one end of the scale there are plenty of high fliers who make it to the top very quickly. Over a third of marketing managers make it to that level within six years, however the title is not exact – it appears to cover a wider range of ages, experience and responsibility than other marketing titles. Similarly, a quarter of all marketing directors have less than nine years’ experience.
At the top level, experience and seniority appear to balance out. Over 60 per cent of respondent chief executives have over 15 years of marketing experience. At the junior level, the big surprise is that some assistant brand managers have up to six years experience and an astonishing sixth of the senior product managers have nine years marketing experience.
Salary is by no means equal: the difference between the two genders remains a significant 24.7 per cent, increasing to 28.7 per cent for the top earners and an appalling 41.5 per cent for the top 10 per cent of earners. This reflects the low numbers of female respondents in senior marketing positions. Not one female respondent was paid more than 70,000 and only three per cent of respondents were paid more than 55,000. It seems employers still need to develop more flexible working practices for women returning to work if they want to balance the inequalities at senior level.
The good news for those seeking evidence of equality is that salary levels are equal at the junior and middle levels of marketing manager, group product manager, senior product manager and product manager, and women’s salaries are actually growing faster at these levels.
Just over a third of respondents have been in their role for less than 12 months, while just over two-thirds do not expect to be in the same role by the end of 1999. This attitude is more marked at the junior to middle levels than at the senior end.
The survey shows that moving company, financial inducement, internal promotion and broadening experience are the most likely reasons to change roles.
When they were asked why they moved companies, marketers across the board rated new challenges just ahead of financial concerns, which suggests a need to keep restless marketers both stimulated and financially well-rewarded.
Marketers at all levels are extremely consistent on this. When asked to prioritise key job characteristics, challenging work and high financial rewards are overwhelmingly regarded as more important than job security, friendly environment, status and opportunities to move internationally or to work part-time (full tables available in the survey).
The survey asked which benefits were most important to marketers. Not surprisingly, most respondents felt that benefits were important/very important. And there was virtually no difference between the boys and the girls – until it came to cars and sports club facilities. Men saw the company car as a much more important benefit than women, while women valued sports club membership much more highly – 70 per cent more – than their male colleagues.
Ninety-three per cent of all respondents receive perks in addition to salary. With the exception of the car, many assistant product managers receive a lot of the benefits that used to be director-only perks. Nearly half earn performance-related pay in addition to their basic salary and 38 per cent receive healthcare benefits.
Perks do increase, as you would expect, as marketers’ careers develop. The benefit most likely to be received is a pension (84 per cent), followed by a private healthcare plan (66 per cent), a company car or car allowance (61 per cent) and a performance-related bonus (55 per cent).
Eighty-four per cent of all marketers get a pension, a quarter of which are non-contributory. Employers’ contributions are mainly between five and eight per cent. No doubt this is due to the relative youth of the sample, as is the average employee contribution which is also likely to be under eight per cent, with a quarter of respondents indicating that the contribution is less than five per cent.
Many marketers enjoy a performance-related bonus and/or a profit share scheme. Over a third of the respondents received more than ten per cent bonus in 1998 and over two-thirds received more than five per cent.
These figures are useful supplements to an individual’s income and are certainly a factor in motivating performance and contribution to team and personal goals. Nonetheless, it is unlikely that they would stop an employee from moving to the right job.
While Labour is keen to move closer to Europe, European working practices have not yet influenced UK marketing departments. Although 98 per cent of respondents have at least four weeks holiday, one week more than the norm in the US, similarities are closer to US holiday practice than Europe. Twenty-two per cent of respondents still have only twenty days and only 11 per cent of respondents have six weeks or more – the norm in countries such as Germany and Italy.
Similarly, notice periods have a remarkably Anglo-Saxon feel to them. As the survey suggests, the British marketer displays great confidence, despite frequent reorganisations in the majority of respondents’ departments, so short notice periods should not worry them. This is just as well. Ninety per cent of respondents had less than or equal to three months notice, with 35 per cent of men and 49 per cent of women having to give just four weeks notice. Again this is a reflection of the imbalance of women at the lower end of the seniority levels.
It is a striking feature of the survey that the gap in benefits between the top and junior levels is not too wide. The one benefit – which is clearly fixed in favour of the most senior managers – is that of relocation. More junior marketers are expected to move for their career and it is felt that the availability of quality candidates near headquarters is sufficient to meet the need. However, at the top of the department the negotiation options are endless.
As already indicated, more than a third of all respondents have been in their job for less than 12 months and two-thirds do not expect to be in the same role by the end of 1999.
Similarly, more than half the respondents in the survey have witnessed a restructuring of their department within the past 12 months. Key factors driving such restructures have been the implementation of category and trade marketing and the split of UK and international responsibilities – two significant developments that affect the day-to-day role of marketing.
On a positive note , more than half the respondents had also witnessed increases in the size of their department.
The marketing community appears more confident than ever – perhaps reflecting the cumulative effect of three years of relative prosperity. But circumstances change, and although marketers appear to be well-equipped to deal with it, the speed of change is much faster than it used to be.
Even as this survey was being completed, the impact of the financial crisis in the Far East and the worldwide recession was being debated in the national press. But as the recession was being talked up, UK interest rates were coming down. So, has the marketing community got it right? Is the real issue how to raise income, to attract, reward and retain quality marketers, or is there another more important priority? The results of next year’s survey should prove very interesting.