Salary negotiation isn’t easy in any profession, but it can be particularly tricky in product management. Whether it’s because some companies don’t have an established product management culture or because the role can differ significantly from place to place, product management candidates have a tough time knowing what the right pay range should be for the job they’re interested in.
This is further complicated because product managers can’t be successful independently; the job relies on so many other people and groups to get the final product out the door it can be tricky to assign a real dollar value to what they do. And since product managers have such a varied skill set and background, it’s tough to find a “going rate” for the industry.
But that doesn’t mean product managers should simply take what they’re offered and be happy to get it. Just like anyone else in the organization, they provide value and deserve fair compensation reflecting their responsibilities, expertise and track record. But product managers must do their homework before entering into a salary negotiation to hammer out a deal both sides can feel good about.
What are product people actually making?
There are two great ways to find out what a reasonable compensation package looks like for the job you want: current salary info and job postings. Luckily there are lots of ways to get this information and use it to inform your negotiating position.
Glassdoor is an excellent source of salary information, and a lot can be gleaned from the site. But before you see a number and establish that as your touchstone, be sure to drill down a bit and make it more specific to your location and experience level.
For example, according to Glassdoor “Product Manager” salaries in San Francisco average $140K per year. But drop your experience level to 0-1 years and the average dips to $120K. Assume that job is at a smaller company (0-50 employees) and it’s down to $100K.
Title also makes a difference. For Associate Product Managers in San Francisco, the average is $105K, for a Senior Product Manager it’s $167K, and for a Director it’s $194K.
And of course, location is a huge factor in compensation. Move those jobs to Dallas and now a Product Manager averages $105K and the average Director pulls in $151K. In Pittsburgh an average Product Manager is getting $89K and a Director makes $129K.
And Glassdoor isn’t your only source for this info. Indeed will tell you the average product manager makes $87K in Tampa and $91K in St. Louis.
Not surprisingly, you can infer that bigger companies pay more, companies in more expensive markets pay more and more senior positions obviously command a higher rate. Therefore make sure your benchmarking is as specific as possible to your experience along with the job, company and location you’re negotiating about. And remember that any metric you find is going to be part of a range of salaries; some people are at the high end and others on the lower side, so expecting the “average” amount may be a stretch depending on your experience and the company’s finances.
Beyond current salary info, you can also look at Indeed and LinkedIn to see what’s being advertised in posted job listings. While not every job posting includes a salary range, many do. Although the range is just that, a spread of the minimum and maximum they’re willing to pay (and there’s nothing stopping a hiring company from going above or below those numbers), it gives a great snapshot of what people are saying they’re willing to pay right now.
Because the market for talent is so dynamic, these current listings are just as valuable as the Glassdoor-style info because it doesn’t include “legacy” salaries that might be in place from better or worse economic climates. It also gives you a little more leverage because these salaries aren’t theoretical—it’s what companies are willing to pay for a similar job this very moment.
3 Tips for Negotiating Your Product Management Salary
Not blown away by that initial offer? Here are three tips to strengthen your position when you go back for more:
Lean on the data
Any product manager worth their salt would never make a case without data to back it up, so impress your potential future employer with your analytical skills and make a strong argument leveraging the data sources mentioned above. You know your experience, the company’s size and location, so you can quickly come up with an expected range based on what’s being paid in similar situations.
The company may counter with caveats about their funding level, the applicability of your experience or the specifics of their industry, but those things are really irrelevant to you—those are their problems. You are a product manager with X years of experience living in City Z and you should expect to make market rate at a minimum.
Back up your negotiations with tangible results
Your resume should speak for itself, but salary negotiations are an excellent time to revisit your previous accomplishments, successes and expertise. Sure, they could hire a product manager for $90K, but will they have shipped four products before, worked in the ad-tech industry for give years and generated hockey stick growth rates for two different companies?
Tap into your inner Kanye and boast about your achievements, toot your own horn and make them realize missing out on you is a mistake they don’t want to make over relatively minor dollars. Their ROI in hiring you will far outweigh a little larger salary than they were willing to offer.
Speak to your demonstrated soft skills
Successful product managers have a proven record of displaying soft skills, so bring specific examples to the negotiating table. Explain how you will not only check the boxes in the job description but elevate yourself and the role to add even more value, particularly if you’re pursuing a management position.
There are plenty of people who can write a user story and talk tech with the developers, but coming to the job with a larger toolbox justifies a higher salary since you’ll be delivering more than the typical PM has to offer.
You’re worth it
For anyone entering into a salary negotiation, it’s critical to keep a few concepts top of mind:
- You have value—You wouldn’t be this far along in the process if they don’t think you’re going to be an asset to the company and are willing to invest in you. So act like it during negotiations.
- Don’t count on a raise—Accepting a lower salary with the expectation that you’ll be so impressive once you start working that they’ll increase your compensation down the line is usually a bad move. Promotions and raises—even cost of living increases—are no longer a sure thing so you should be prepared to make your initial salary for several years.
- Know your floor and stick to it—Figure out what the absolute minimum you’re willing to take is and don’t let the attractiveness of the role or company deter you from demanding it. If you can’t cover your expenses, save for retirement or afford a vacation, you’ll quickly start resenting the company for low-balling you (and yourself for taking it).
- It’s all about the Benjamins—Stock options and equity are great perks in an offer but, unless you’re already independently wealthy, your cash compensation should be the driving factor in the merit of an offer since those other things panning out is far from a sure thing. The same goes for free food and on-site massages.
- Start on a positive note—Settling for a lower number than your ideal salary is OK, but you want to start your job feeling good about the move and not offended or remorseful about your package.
- Less can be more—Taking a paycut or accepting the lower of two offers for the right reasons is OK. Working on something you’re passionate about, having coworkers and managers that you love and respect, or even a shorter commute and flexible hours that let you spend more time with your family are all perfectly acceptable reasons to settle on a slightly lower number than you’d prefer.