A couple of months ago there was a bit of a furore about reports that some business development and marketing people at London’s top law firms were being paid as much as £477,000 (even though this turned out to be a combination of the highest base salary awarded (£345,000) combined with the biggest bonus on offer (£132,000)). I reflected on the debate and offer the following observations:
Profit improvement The primary focus of a marketing professional is to help the firm anticipate and meet client needs whilst increasing profit. Even a small increase in profitability can mean very significant financial gains for a legal practice. There are a number of medium sized firms whose fortunes have been transformed by impressive marketing strategies.
Profit share Technically, a marketing professional in a law firm can become a member of an Alternative Business Structure (ABS) and, like marketers who achieve partner status in the leading accountancy practices, can share in the profits.
Fee-earner turned marketer Increasingly, firms are releasing senior fee-earners from their client duties and putting them in charge of growth and business development strategies. So it may be that these higher salaries reflect on the typical equity-based remuneration received by these people.
Sales role The use of the term “business development” implies a sales and selling role. If an individual makes a significant contribution to a firm increasing its conversion rate overall or winning a number of multi-million pound tenders then, in other industries, they would receive large sums in commission.
Marketing salaries in industry
Meanwhile, over at Michael Page where marketing salaries in general are researched regularly the story is different. They report that in 2014 in London that the lowest marketing director salary is £60,000, with an average of £80,000 and a maximum of £150,000.
Marketing salaries in professional services
We’ve always known that marketers in the professions receive comparatively higher salaries than marketers elsewhere. Matched perhaps only by the financial services sector.
The Hudson 2012 statistics on the marketing directors in professional services showed an average of £120,000 and a high of £160,000 http://uk.hudson.com/Portals/UK/documents/SalarySurveys/marketing-salary-survey-2012.pdf
Carter Murray, recruitment specialists in marketing roles for professional services, http://www.cartermurray.com/uk/articles_guidance/professional_services_salary_guide_213/ report in 2013 that marketing directors (excluding the Magic Circle firms) earn between £85,000 and £150,000 in firms with a turnover of up to £50 million and between £120,000 and £180,000 in firms with a turnover of between £50 million to £200 million.
At Leighton Taylor http://www.leightontaylor.co.uk/index/ – another specialist recruiter in the professions – the highest paid salary currently listed was for between £100,000 to £150,000 for a business development director at an accountancy practice. And there was a role for a global head of business development at a law firm advertised at £100,000 to £130,000.
A spokesperson at Totum http://www.totumpartners.com/job_search.php , which specialises in recruiting marketers for law firms, commented in an article that “the best paid marketing director earns about 40 per cent of the average equity partner at that firm”. This seems to put things a little more in perspective.
The increasingly strategic role of marketing
In a recent Harvard Business Review blog there was an article on “the rebirth of the CMO” (Chief Marketing Officer) http://blogs.hbr.org/2014/08/the-rebirth-of-the-cmo/ . It identified three activities that are required of all CMOs:
- Discover data-driven insights that drive growth
- Design the right strategies and processes to carry out the vision in a multichannel world
- Become the organisational glue to deliver change
The expansion of research, strategic and organisational change roles might be the clue to why the salaries of the very best marketing and business development leaders are increasing. Particularly where markets – and professional services are no different – are undergoing such rapid change. The number of marketing and business development professionals who are promoted to chief executive roles would provide further evidence.