2015 JMG SALARY SURVEYThe Jacobs Management Group Salary Survey
An industry in flux is an industry with endless possibilities. Considering the changes in pipelines, mergers and acquisitions, regulation, consolidation, access and other factors in healthcare, do we think of it as a chaos that threatens everyone, or as a natural change that continues to open doors? We believe the latter, and we are happy to present these statistics, gathered from over 300 people working at over 100 companies. Here’s a snapshot of how your colleagues are doing in terms of compensation: the 2015 Jacobs Management Salary Survey results.
From Jacobs CEO and HS&M Publisher Cari Kraft: The 2015 results indicate that we continue to be into a building phase. Our survey helps you see which sectors are expanding, how compensation structures are changing, and what the noticeable trends are. We saw some interesting trends and surprising results:
• The healthcare vendor space is leading sales growth at a rate of 12%, followed by medical device at 7%. Marketing team growth is led by medical device and biotech at 8%. Across the board, sales and marketing team average growth remains strong at 6%.
• Biotech sales compensation takes a jump in 2015 with top sales rep compensation up 40% over 2014. Biotech top sales reps earn the most at a total compensation of over 259K. This is the first year biotech top sales reps out-earn medical device top sales reps.
• There is a high cost to both poor hiring and leaving positions open. The cost of a marketing or sales mis-hire is approximately $82K. The monthly cost for each open sales position is on average $45K, while the cost of an open marketing position is $39K.
• At-risk compensation models are becoming even more risk/reward focused. The highest leveraged compensation packages were for top healthcare vendor reps, with up to 59% of their compensation in commissions. Not far behind were top medical device reps, with 57% of their compensation in commissions.
This report summarizes the results from the Jacobs Management Group, Inc. Compensation survey conducted in 2015. The target audience focused on key leaders in the medical device, pharmaceutical and biotechnology industries with a focus in the marketing and sales arena.
Results were compiled from over 330 individual responses, representing over 100 companies. Companies ranged in size from over $100B to under $10M and were categorized into four main sectors: pharmaceutical, biotechnology, medical device, and healthcare vendor. Over 80% of respondents had titles of manager or above.
The continued good news is that both sales and marketing teams are forecast to grow across all sectors
Sales forces grew by 7%. Pharmaceutical companies still have, on average, the largest number of reps per company, at an average of 930 reps as compared with the average across all the healthcare sectors of 500. The training period for new sales reps is a little over 3 months. It takes approximately four and a half years for a sales rep to be promoted.
The fastest growing sector is healthcare vendor, which will grow by over 11%, followed by the medical device sector, with steady growth of 7%. Both pharmaceutical and biotechnology are increasing at a slower rate, with 3% and 2.5% respectively.
MARKETING TEAMS ARE ALSO GROWING AT AN AVERAGE OF 7%
As we saw in 2014, marketing teams continue to grow at a pace of 7% annually. ‘I he average marketing department has a team of 122. Forecasts include adding an average of 9 marketing professionals. ‘I he average training period for a marketing team member is two and a half months. The typical marketing professional remains in their position for a little over 3 years before being promoted. Marketing professionals travel approximately 27% of the time.
MARKETING DIRECTORS EARN 60% MORE THAN PRODUCT MANAGERS
Marketing directors earn, on average, earn 60% more than product managers. More than 65% of that comes from an increase in base salary, with the remainder in increased bonus potential. Product managers’ bonuses are, on average, 17%, marketing managers 2196, and marketing directors 24%. Product managers on average have a total compensation of $I 34K, marketing managers S159K, and marketing directors $219K.
MEDICAL DEVICE AND BIOTECH MARKETING TEAMS ARE EXPERIENCING THE FASTEST GROWTH
Medical device and biotechnology companies are growing marketing teams the fastest, at a rate of just under 8%. Biotech growth has slowed from a 2014 growth high of 24% to 8%. Healthcare vendor growth has slowed as well, from a 2014 rate of 15% to 4%. Pharmaceutical company marketing team growth remained the Same a 2014 at a rate of 5%.
IT’S EXPENSIVE TO HIRE THE WRONG PERSON!
‘I lie one-tine cost of a marketing or sales mis-hire is approximately $82K
AND IT’S EXPENSIVE NOT TO HIRE SOMEONE!
Each month a position remains open costs the company, on average, $39,500 for a marketing position and $45,300 for a sales position. And filling a position takes time, which lengthens with the level of the position.
BIOTECH SALES REPS OUT-EARN MEDICAL DEVICE REPS FOR THE FIRST TIME
Biotech sales compensation took a jump in 2015 with top sales rep compensation up 40% over 2014. Biotech top sales reps earn the most, at a total compensation of over 259K. The gap between top reps and first year reps widens to 80K as compared with the 2014 spread of 70K. Across the hoard, top sales reps earn an average of $202K, with first year reps earning an average total of $I 19K. Top sales reps’ and first year reps’ base salaries differ only by an average of 25K. 50% of sales rep commissions are paid monthly, 44% are paid quarterly.
Jacobs Management Group, Inc., a leading healthcare industry search firm, undertook this 2015 Compensation Survey specifically for the medical device, pharmaceutical, biotechnology, and healthcare vendor sectors to provide our clients with specific quantifiable compensation data. This article presents the highlights of that survey. Please click below to get the full survey report, or email Cari Kraft for further details, or to provide input for what you would like to see in the 2016 Survey. We would appreciate knowing if this has been helpful to you.