Episode #0076 - How much do pricing professionals get paid?

In this episode of Pricing College - we discuss how much pricing professionals from analysts to pricing directors get paid.   Will it make you jealous, proud or whet your appetite for a promotion?   It's a question that I'm often asked you know, How much should we spend on pricing analysts or a pricing manager? Often clients would consider pricing to be a lower salary than it is. So I often have to have the discussion that to get somebody good you've got to pay the money. Sometimes people are a little bit overwhelmed with that they go, really that much money. Yeah, the returns you get from a pricing analyst a good one or a pricing manager are huge. So you've got to know exactly what the salary bands are.   I think in that instance when someone thinks all pricing they're just plugging numbers into a spreadsheet. I think what you should do is refer them to some of our previous episodes. If you're thinking that a pricing analyst is lower quality. Less skilled person say than a newly qualified Accountant or even an Accounts Assistant, you're probably highlighting issues that will come down the line. If the job is data entry that's not a pricing profession. If you're looking for business analysts, let's be honest, business analysts and those people are much easier to find than skilled pricing professionals. If we say that in Australia, in Sydney at this point in time, a qualified accountant in a business would have been looking somewhere between $90,000 to $120,000 per annum with the package, etc. A business analyst would probably be somewhere similar maybe $80,000 to that ballpark.   I often think when I hear low salaries, it's immediately alarm bells to okay, the positioning of this role is not right. People don't understand the role of pricing in the business or people trying to like if they do have a pricing team. Maybe the pricing team's been downgraded to some kind of operational like finance-driven admin led pricing team. And for those types of roles yeah, why would you be paying top dollar? Because ultimately literally downgraded everybody to an admin and can only generate so much return from that type of pricing. But like in terms of strategic pricing and people that are good at value-based pricing, latest pricing strategy, analytics, putting it all together plugging your systems. And good architecture, good operations, process improvement, continuous change, innovation, connecting the dots, bringing people together. You're going to be looking for a pricing analyst from 100 to 150 plus, for a pricing manager that can be from 165 to 230. This is like pretty experience but not over seven years of experience. For real strategic experts, leaders, executive executives, like you can be paying well let's say from  230 up to 500 and this is the base salary. This does not include all the thrills incentives or rewards, that's additional. That's another topic in itself. The right reward and bonus structure for pricing people which we'll probably cover in another episode. But that's very important for very good pricing people. Because sometimes if you haven't got the cash to sponsor on like a salary, or maybe you're a smaller business. You need good pricing expertise but you just don't have the money to spend on a higher salary. You should be looking at a good rewards incentive scheme, just to compensate for excellence.    I think Joanna covered there what you said the spectrum I suppose, from low to high and each of those categories. When we say pricing analyst you can have more junior up to a senior pricing analyst. There's a huge difference between the senior pricing manager leadership and somebody else who's, more of a general generic manager. Of course, in companies, there are a lot of people called managers who don't manage very much. The other thing we'll say obviously with it's like a CEO of a business, you can be the CEO of a small company versus the CEO of a multinational. There are hugely different things to compare if we look at the revenue that you're actually managing. Revenue that you're looking at and optimising. It's hugely different from a smaller company to a very large company. Obviously then the higher salaries would generally pertain to people in those major corporations where the cash benefit they can deliver is much larger. One final thing I'll add is, I suppose one final question I'll ask is, are salaries going up and down or up or down at this point in time? I'll ask Joanna what her view on that is. Because I've done some work in marketing in the past, and my personal belief is that marketing salaries are actually dropping. Marketing is a sector that we talk a lot about on these podcasts so what does Joanna think about pricing.    Again it's been a question asked because of COVID and businesses closing down. Is there an excess or pricing talent in the market now? Should we be paying them as much as we did before? Should there be some kind of decrease? Or should we be thinking about decreasing salaries for new starters in pricing? What I have found well, from March to May things just stagnated in terms of salary, nothing went up, nothing went down. In terms of talent flow the good people were maintained, good companies keep talented pricing teams. That's what we found very clearly. The ones that probably were left in the market, either, unfortunately, were restructured out businesses closing down. Or perhaps in terms of capability, not as strong as the people that maintain their jobs. But it was a tough market. In terms of salary, the ramifications of that now, we found that things are getting more buoyant in the market. Companies are more confident and we're seeing definitely an increase in the number of pricing projects being launched in the market, especially from September onwards. And we see that to continue into the new year, especially up until March at least from that there's been an increase in hiring. I think when we've reviewed and analysed the job boards the most people are hiring are for pricing analysts. Maybe lower level so there seems to be a little bit of caution in terms of investing in like pricing managers. However, leading companies are investing in very good senior seasoned and capable pricing leaders at this time to lead transformations. Transformations fundamentally from cost-plus to value-based cultures, big work involved, system upgrade, people Mindset Strategy changes. So for those types of people salary has actually gone up. So, I think it would have gone up about 2% to 5%. We are seeing an increase in rewards and bonus structure as well. And there are very few people in that category that we could trust to do those sorts of jobs. That's why the salaries are going up and companies are willing to pay those salaries. Because they know these are proven professionals that can get the results that they need in a short space of time. Traditionally within a two to three-year roadmap but with expectations to deliver incrementally but maybe in double digits within the first six months. So tougher milestones to achieve and deliverables but these people can do it. So yes, they're getting paid. I hope that's answered the question.   That actually reminds me of when I used to be an accountant in London, and I think it was Michael Page or one of the big accounting recruitment companies used to publish an annual report. To be honest, wasn't very useful but people used to read it. It would either make you jealous give you ambitions or make you lose hope.