The role you get will be based on your marketable skills. We talked about that in the last two issues of the newsletter. And each of those roles equates to a monetary value to the organization. 

Example: Let’s say you’re going into sales. Then the dollars that you bring into the company will reflect how much you take home. If you’re in HR, it is less clear, but it will be a function of how much profit you can create for the company by managing payroll and benefits expenses effectively. 

You can use the same logic across the board with any role.

Generally, organizations will also look at ranges for certain roles with publicly available data and try to fit within a range of 20% below and 20% above the median salary with a COLA (cost of living adjustment) factored in. 

You can view national averages for salaries at a website like: this calculator from Payscale or this article from Indeed

But that’s just the starting point.

% SAT TAM

How much you can make is greatly affected by this equation. Let’s define each part.

• TAM = Total Addressable Market. Basically, what is the total number of people who are able to and might want to buy a specific product or service? 

For Coca-Cola, that could be upwards of 6 or 7 billion people! 

• % SAT = Percent Saturation. Of the TAM, how many people will choose that company’s products or services when they want or need to buy them.

A high % SAT TAM creates a somewhat predictable income stream for the organization. When that happens, they can tweak their budgets and systems to create more value with less waste, which leads to more profit. 

So even though the average price of a can of Coke is $1.50, when 2 billion people choose that on a weekly basis, that adds up!

And oftentimes, more profit leads to higher salaries for the employees. Some companies even have a profit sharing model that rewards all employees.

Customer Lifetime Value or LTV

The Lifetime Value of a customer is also a factor in determining pay. 

• If they purchase something one time, how much is that thing worth?

• If they purchase something multiple times, how much is it worth each time they buy it? 

(this is why subscriptions are becoming so popular)

So let’s pose a question: “Who is going to make more, the person working the front desk at the used Kia dealership or the Ferrari dealership?” 

Ferrari. 

Even though they are doing essentially the same thing, one will make more because of the cost of the thing going out the door.

Now, there are some other factors, but these are three of the big ones. 

So you want a higher salary? Great. Here’s what you do.

1. Figure out what you need to make. Write that number down.

2. Get clear on the job type you want. That will give you a general range of what you can make.

3. Find organizations or companies that have higher values for % SAT TAM and LTV. 

P.S. It will be helpful to look for organizations in industries that you may do better in because of your background. But other people will get this too. 

Competition may be higher in those companies and industries, so be aware of how competitive you want your job search to be.