A common question Product Managers come across in the interview process is the critical but dreaded, “What are your salary expectations?” And though it may seem like a question that warrants a straightforward answer, it’s a nail-biting process for many Product Managers.
What’s the perfect figure? Go too high and you could hurt your chances of getting an offer, too low and you end up with an amount you’re not happy with. It’s a delicate dance, but the right approach can help you successfully navigate the question without any of the angst. In this guide, we’ll walk you through everyting you need to know to master how to answer the salary question in a Product Manager interview. Here’s what we’ll cover:
- Why Employers Ask the Salary Question
- How to Answer the Salary Question: Know Who’s Asking
- Prepare Your Salary Requirement Answer Ahead of Time
- When to Discuss Salary Expectations
- Salary Expectation Answer Examples and Strategies
- How to Settle on the Right Salary Requirements Answer
- Get The Product Manager Salary You Deserve
Here’s how to have productive and informative conversations on your desired salary with an interviewer.
A recruiter or employer wants to know what you expect to earn as a Product Manager at their company for several reasons:
- Budget: Top on their list of priorities is to get a sense of whether or not they’d be able to afford you as an employee. Every employer comes up with a budget for the role they are hiring for before they start and communicate this to the recruiter right at the beginning of the hiring process. This is not a fixed budget, however, as sometimes candidates may consistently ask for a larger figure than their budget, which suggests they are offering a salary that’s below the market rate.
- They want to determine your professional level: A candidate who asks for a considerably higher amount than the budgeted amount, or what other candidates have given, is likely too senior for the position. Similarly, a much lower figure suggests a lower experience level than what they are looking for.
- They want to gauge how much you think you are worth: This will inform what they offer you if they hire you. You should always keep in mind that your confidence in your experience and skillset will influence how much money you get at the end of the day.
Always tailor your answer according to the person interviewing you. The salary requirements question is almost always going to come from a recruiter. This may be an internal recruiter who works for the company you are interviewing with or an external recruiter who works at a staffing agency — more commonly known as “headhunters”. You have to understand why they want to know the answer to the salary question on their end. Each will have different motivations.
Internal Recruiters (aka HR Managers or Talent Acquisition Specialists) want to lock you down at a rate that is within their budget. They are incentivized by how much money they save a company. The more money they save a company, the higher their year-end bonus. Thus, their objective is to either not hire for the position or to hire you for the lowest amount of money possible.
Their interest is completely and directly in conflict with yours because of this. Go to any career page of your favorite companies and even the smaller ones have multiple roles that need to be filled. It is the responsibility of the internal recruiter to maintain the budget that is allocated for all the roles.
External Recruiters (aka Technical Headhunter or Technical Recruiters) earn a commission or a percentage of your first-year annual salary. Therefore, these people are extremely incentivized to get you more money. In essence, the more money they make you, the more money they make.
They work at a staffing or headhunting agency that has been contracted by the company, and the more money they get you on your next job, the more money they make. This means you can be honest about your salary expectations. You can break it down for them:
“(X amount) is the lowest I’m willing to take for this position. I’m looking for (X amount) from most companies, but ultimately, I’m trying to get to (X amount).
The above points highlight the importance of proper preparation for the question. Overvaluing or undervaluing yourself could hurt your chances of moving forward in the interview process. And at the same time, you don’t want to hold yourself hostage to the wrong number during the salary negotiation stage or create a challenge for yourself later in the job where you feel dissatisfied with your compensation and need to negotiate a raise. It’s much harder to get to the figure you desire if you are starting from a lower amount.
You’re almost always going to be asked this question in two separate situations:
- At the first round phone screen, or the first time the company ever speaks to you.
- At the post-final round interview—towards the end of the hiring process after you’re done interviewing with all the relevant stakeholders—when they are getting ready to make you an offer.
How to Answer the Salary Question: First Round Phone Screen
First and foremost: do not talk about salary during the first round phone screen. The objective of the first round phone screen is all about getting to the next round of interviews. No matter who is asking you this question or when they’re asking you this question, your objective is to always get to the next round of interviews until there are no more interviews.
At the phone screen stage, you haven’t even talked to the Hiring Manager, any of their engineers, designers, project managers, or any of the stakeholders you would be working with. These are the people that you will be working with on a weekly basis, not the recruiter. And until you are done interviewing, there is always an opportunity for you to impress these people so you can get more money. Budgets change for hiring all the time, based on how much the interviewers like you.
If you absolutely have to answer, give a range of what you are comfortable with, instead of tying yourself to a single number. Do research on Product Manager salaries in your target location and give a salary range within $10,000 (i.e. “$110,000 to $120,000” or “$140,000 to $150,000,” etc.)
How to Answer the Salary Question: Post-Final Round Interview
After the final-round interview, it might do you some good to consider if this opportunity is the right one for you. There are many critical factors to consider due to everyone’s unique situation. For example, it may be a position you are comfortable taking a pay cut for because you are simply such a big fan of what they are doing. You might also consider the benefits package and other perks they offer.
While salary is an important factor, remember that the benefits that a company provides or the opportunity itself could be equally significant to you. Have the salary conversation with your potential employer after you have received your job offer.
Regardless of your situation, remember that a salary negotiation is always an option. If you find yourself in a situation where you have to negotiate, research suggests that your counteroffer should be 10 to 20 percent higher than your initial offer. It’s always better to play it safe than to lose the opportunity, so make sure that you have a realistic number in mind.
If you’re in need of more tips, we encourage you to reach out to us for a second opinion and learn how to negotiate for a higher salary after receiving an offer.
When an internal recruiter asks you this question, your answer can go one of two ways: Deflect the question and avoid answering it until the salary negotiation point, or avoid giving a specific number.
Here are some strategies of how to go about it:
1. Deflecting The Question
If you’re still in the early stages of the interview process and don’t feel like you have enough information to give an ideal figure, you should try to bypass the question—at least for the interview with the internal recruiter.
You can give a response like:
“First and foremost, I understand why you’re asking me this question, but you know why I can’t answer you. If I give you a number that’s too high, I’ll scare you guys away and you’ll probably have no incentive to move forward in the interview process. However, if I’m giving a number that’s too low, I’m showing you that I don’t value myself, don’t have confidence in what my net worth is in the market, or I’ll end up holding myself hostage to that number when we eventually go into the salary negotiation. This is why I can’t really answer that question.”
Your interviewer will be surprised, but you will have communicated that you prefer to talk about salary negotiations further into the interaction without offending them. A follow-up question on what the company anticipates to offer the selected candidate is a good idea as it helps both ends get a feel of whether it is worth continuing with the interview process.
2. Providing a Range
If you do have to give them a number, you may choose to give them a range. Remember that your lower number should be as close to the target number as possible. Our experts at Product Gym recommend giving a range of between $100,000 to $105,000. Depending on your skills and experience, you’re probably worth more, but that’s roughly the average of what most product managers are making. At this point, you intend to get past the Round One interview and into Round Two. You need to get past the recruiter first, so you can start talking to people that you will be working with who actually matter.
If the recruiter is not satisfied with this range, you can follow it up with this statement:
“I understand you have a job to do; and may I ask why you are so persistent with this particular question? Because it makes me feel really uncomfortable when you press as hard as you do. This may not be the answer that you want to hear, but I bring a considerable amount of value to every organization I was ever a part of and I only ask that I am compensated fairly, which isn’t too much to ask for …. Right?”
Remember: Always be as polite as possible when giving your responses.
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Again, the range you give ultimately depends on your skills and experience. So there’s nothing wrong if you prefer to give a different or more specific range of numbers. This doesn’t mean you give a figure based solely on what you want to earn. You have to back your request up with research.
Similar to any other profession, the number varies depending on seniority and location. There are plenty of job sites online that can help you determine your worth in the current job market. You can get good figures across Glassdoor, Paysa, Indeed, and Builtin. Here’s a breakdown of Product Manager Salaries on Average in 2020:
NYC Product Manager Salaries:
|Mid (normally advertised as PM on career websites)||$113,220||$114,329||$128,090|
|Senior (assuming 7-9 years of experience)||$146,529||$129,963||$153,909|
|Director of Product Management||$169,388||$164,101||$172,783|
|VP of Product Management||$176,230||$209,474||$214,570|
**Different sources might have different names for different seniority levels in product management.
SF Product Manager Salaries:
|Mid (normally advertised as PM on career websites)||$130,566||$102,959||$161,720|
|Senior (assuming 7-9 years of experience)||$164,004||$161,751||$178,446|
|Director of Product Management||$200,537||$204,026||$223,854|
|VP of Product Management||$201,004||$204,825||$254,964|
Note that we are only including base salary here. Every company has its own way of handing out bonuses. Bonuses might come in the form of cash or company equity. These numbers are averages and you can expect them to change depending on the size of the company.
Also, it is important to understand that the seniority levels of product management might change drastically depending on the company. We wanted to provide you with ballpark figures for the most commonly known Product Manager salaries.
While these figures are average and cover companies ranging from very small to multinational, it is safe to assume that you should expect nothing less than annual compensation of $100,000.
Another way to reach an ideal salary range is by using your current salary as a starting point. This is especially helpful if you are making a lateral move. Assume that your current or previous salary is in line with market rates, unless of course your company was known for lower wages than the rest in the industry.
To sum it up, there are easy steps to successfully navigating the salary question in a Product Manager interview:
- Know your worth
- Learn how to deal with recruiters
- Have a well-formulated answer informed by research
- Use negotiation to get yourself the best offer possible
Want to learn more? Watch our free webinar on negotiating big Product Manager offers to get more actionable advice that you can implement right away!