The average CMO-level executive last year took home $1.5 million, according to an exclusive analysis by Advertising Age, a BtoB sibling publication. Nice pay—but nothing next to the $15.5 million hauled in by Dell Inc. CMO Mark Jarvis.
Jarvis was lured to Dell last year with a package including a $3 million "new-hire, long-term cash award" and use of a jet to commute between his house in California and Dell offices in Texas. He tops the list of CMOs in a salary survey produced for Ad Age by Equilar, an executive-compensation research firm that analyzes proxy statements and other filings of public companies.
Proxy statements must include the pay of the CEO, chief financial officer and the three other most highly paid officers; CMOs rarely make that list. But drawing on Equilar's database, Ad Age chose 100 companies that have disclosed CMO-level compensation.
Ad Age found a number of consumer marketers with sizable paydays, including Target Corp. Exec VP-Marketing Michael Francis ($4.6 million); former Safeway CMO Brian Cornell ($3.5 million); and former Domino's Pizza CMO Ken Calwell ($3.0 million).
That's not to say CMOs in gen-eral did poorly. Average total pay for the top-level marketing executive at companies in the Ad Age analysis was $1.49 million in 2007.
About one-fourth of that came from salary ($358,000); bonus, perks and nonequity incentive pay made up another fourth ($360,000). The rest ($767,000) came from stock options and stock awards.
Total pay for top marketing executives last year rose an average 8.1%. Salaries increased 6.0%; bonus, cash incentives, perks and benefits edged up 3.0%. Estimated stock compensation—options and awards—jumped 11.7%, though actual worth won't be known until after options and awards vest in future years.
Average CMO-level pay for the 10 largest companies analyzed by Ad Age was $4.8 million. But compensation doesn't necessarily correlate with company size; pay at some smaller marketers can be lucrative.
United Online, a $514 million (revenue) dial-up Internet service provider, gave CMO Matthew Wisk a package worth $2.8 million. Sears Holdings, 100 times the size of United Online, paid CMO Maureen McGuire $2.3 million.
Target's Francis had the biggest base salary on the list ($710,769), followed by Netflix CMO Leslie Kilgore ($700,000).
CMO isn't exactly a tenure-track position. Among the 100 companies in this review, 28 said goodbye to their marketing chiefs in 2007 or 2008.
A few executives retired, but many left to pursue other interests—more evidence of the short lifespan of your typical CMO. (Average CMO tenure in 2007 was 26.8 months, according to headhunting firm Spencer Stuart.)
CMOs often don't stay around for the long haul, but CMO wealth still is tied more to stock—more of a long-term incentive—than to salary or cash incentives.
Stock options and stock awards accounted for 52% of the value of 2007 pay packages for CMO-level executives, according to Ad Age's analysis. On average, executives on this list owned $2.2 million of company stock at the end of their companies' last fiscal year.
How does CMO-level pay compare to CEO compensation? Not even close.
Median compensation for the Standard & Poor's 500 CEOs in place for at least two years was $8.8 million in 2007, up 1.3% from 2006, according to Equilar.
Average 2007 pay for CEOs of the nation's top 10 media companies was more than double that—$22.7 million—according to figures Equilar compiled for Ad Age. Top of the heap: CBS President-CEO Leslie Moonves ($67.6 million).
The poorest-paid media company chief: Google Chairman-CEO Eric Schmidt, who earned just $480,561 (including a salary of $1).
Schmidt should do OK, though. At the end of 2007, his 3% stake in Google was worth $6.6 billion.