Product Management is one of the most powerful careers in the corporate world - every decision you take as a Product Manager can influence the behaviour of millions of people using your product. Given the nature of the role and the huge brand names seeking Product Managers, it doesn't come as a surprise that such a heavyweight job function attracts massive paychecks and makes Product Management one of the most well-paid and revered job functions in the corporate world. So what kind of salaries do PMs draw in India and outside of India? Which companies are the best pay-masters when it comes to PM roles? And what is it that PMs do that makes their job so well paid? Let's take a look.
Who Are Product Managers? What Do Product Managers Do?
McKinsey & Company calls Product Managers mini-CEOs. "Product Managers are the glue that bind the many functions that touch a product—engineering, design, customer success, sales, marketing, operations, finance, legal, and more. They not only own the decisions about what gets built but also influence every aspect of how it gets built and launched."
A Product Manager wears many hats in a company and possesses knowledge about various functions that allows them to bring together cross-functional teams. As opposed to individuals in teams with specialized skill sets, a Product Manager leverages the skills of others to produce a very high-quality product.
There are reasons why Product Managers are called mini-CEOs, one of them being that Product Management as a career also serves as a training ground for future CEOs. Do you know what Indra Nooyi (CEO of PepsiCo.), Susan Wojcicki (CEO of YouTube), Stewart Butterfield (CEO of Slack), Satya Nadella (CEO of Microsoft), Marissa Mayer (Ex-CEO of Yahoo) and Sundar Pichai (CEO of Alphabet) have in common? They were all Product Managers at different levels of seniority at some point in their careers.
For an excellent analysis of the future of Product Management and the definition of the three main types of Product Managers at top companies, read this.
What Does It Take To Become A Good Product Manager & Get Hired By Top Companies?
Julia Austin, who until June 2020 taught Product Management at the Harvard Business School, says a Product Manager must master baseline core competencies like conducting customer interviews and user testing, performing market assessments, pricing and revenue modelling etc.
She emphasizes that a good PM should have a high EQ, that is the ability to empathize with customers as well as have a strong relationship with their organization that would enable them to navigate both internal and external hurdles to ship a great product. Julia provides some invaluable insights into what it takes to become a Product Manager in this HBR article.
Now let's get down to the brass tacks of this article and why you decided to read it, by answering the question...
How Much Do Product Managers Earn?
To put it simply - a lot! Depending upon the organization you end up working with, Product Management is one of the highest paying jobs in the corporate world. An Indian MBA graduate can earn a median base salary of ₹ 15.2 lakhs per annum, excluding other salary components like bonuses. But this is just an overview. How much do top companies hiring Product Managers pay? Which industry pays Product Managers the most? How much do Product Managers outside of India in countries like the US earn?
Given below is data, obtained from LinkedIn and compiled by Team InsideIIM, which in 5 tables answers all of the aforementioned questions to provide a crystalline picture of salaries that Product Managers earn in India and the United States of America.
Please note that the salary data provided below is not filtered by educational qualifications. Also note that this salary data is for the job title 'Product Manager'. 'Senior Product Manager' and 'Directors of Product Management' etc. are higher level roles that pay even more than what Product Managers earn in a year! You can conduct your own independent research on salaries for these job roles using LinkedIn, Glassdoor, PayScale, and Indeed.com data.
The top-5 companies offering the highest median base salaries for Product Management jobs are Flipkart, Microsoft, Amazon, PayTM and Oyo Rooms. These are all companies that regularly hire from India's top MBA campuses; in fact, Amazon is one of the top recruiters across most top-ranked business schools in India!
At these top-5 companies, a Product Manager can earn up to ₹ 38.00 lakhs a year, and can expect to earn a minimum of ₹ 16 lakhs a year as a base salary. This is excluding any bonuses and perks that are usually offered by these top organisations.
The table above also shows the diversity of industries from which companies are willing to hire PMs, including companies from the BFSI, Hospitality, E-Commerce, Telecom, and IT sectors.
It's common knowledge - Tech companies hire PMs most aggressively and as is clear from the data above, they're also the best paymasters when it comes to these roles. But did you know that Product Managers are also in demand (and very well paid) in sectors like Real Estate and Recreation & Travel? As a PM in a real-estate firm, PMs have reported earning a median base salary of ₹ 18.00 lakhs a year, which can go up to ₹ 30.00 lakhs a year.
At the entry-level, Product Managers have reported earning a median-base salary of ₹ 10.00 lakhs a year, going up to ₹ 23.00 lakhs a year. The latter salary figure, we suspect, is for top-tier MBA grads + top-tier engineering/non-engineering graduates.
As expected, as you gain more work experience as a PM, you can expect higher salaries due to increments. At this stage, it's also important to note that by the way of lateral hiring or internal promotions, you can become a Senior Product Manager (or higher) and earn an even greater base salary.
Outside of India, the country where Product Managers are paid a bomb is the United States of America; particularly the San Francisco Bay area a.k.a. the Silicon Valley. Tech companies like Facebook, Google, Microsoft, Uber, EA etc. that are headquartered in the Silicon Valley pay hundreds of thousands of American dollars to Product Managers.
Given below is the list of the top-20 companies in the US based on the median base salaries offered for PM roles.
$175,000 - that's what Facebook pays its Product Managers as a base salary. As of July 2020, this translates to ₹1.3 crores per year, and this doesn't even include the massive signing bonuses and other perks that companies like Facebook offer their employees.
It's not surprising to note that Technology companies pay Product Managers the most. But it's interesting to note that companies in other sectors like BFSI (JP Morgan, Amex), Telecom (AT&T), Media & Entertainment (Walt Disney, NBCUniversal), Retail (Home Depot) etc. also offer lucrative Product Management roles!
More information around salaries for Product Management jobs anywhere in the world can be found on LinkedIn.
Before answering this question, it's even more important to answer the question - should you even become a Product Manager? Besides the massive paycheck, what does a Product Management career have to offer to you and your career ambitions?
It's not as if you can just announce your Product Management goals to the world and get hired by Google the next day - what skills will you need? How do you get these skills? Do you need to have an engineering background for PM roles? What does the life of a Product Manager look like? How high-pressure is the job? Are Product Managers really "mini-CEOs" or is it just an exaggeration?
These are just a fraction of the questions you need to ask before stepping into any career, including Product Management. We understand this, so for all you future mini-CEOs (and CEOs), we bring to you Product Management 101 - a series of sessions conducted by Ellora Nath, an ISB grad. who went on to become a Senior Product Manager! Ellora has a message to share with you.