Women in Consulting's 2010 compensation survey results indicate participants are optimistic about projected revenue and that effective use of social media has helped their profitability.
Women in Consulting (WIC)'s president, Avery Horzewski, informed me that the organization released the results of its annual compensation survey. (You may remember that I spoke with Avery last month about the status of women in the consulting field.) This year's survey results indicate a growing optimism among participants regarding projected revenue. Not only did respondents on average make more money in the last year than in previous years, it was also generally more than they had projected -- and they are projecting even higher revenues for the coming year. From the press release:
- Average (mean) annual gross revenue was $205,000, up from $172,000 in 2009.
- Median gross revenue was $120,000, up from $115,000 in 2009.
- Net annual gross revenue after paying subcontractors/employees is down this year, suggesting that consultants are making more use of subcontractors to expand their service offerings and keep more business within their practice.
- Median gross revenue for the top 20 percent of respondents is stable compared to 2009 ($300,000 vs. $299,000), while net annual gross for this group is higher ($392,000 vs. $336,000 in 2009).
Graph used with permission from WIC.
As you can see, more respondents have experienced an increase in revenue than have predicted one in each of the last four years except for 2009 -- which we could hopefully label as an economic aberration. Thus, there's good reason to believe that, for this group of consultants at least, more money is in the wings.
A number of respondents indicated that they had achieved surprising profitability improvements through more effective use of social media. I found this somewhat puzzling, especially since according to the quote in the press release from Renee Daggett, president of AdminBooks, "While my gross revenue was similar to last year, my profits grew 250 percent." I spoke with Renee to get clarification on this point, and she confirmed that the boost from social media was not from generating more business, but from generating it at a lower marketing cost. Her firm was able to scale back traditional marketing expenses and focus on Facebook instead. Yes, Facebook -- LinkedIn not so much. According to Renee, Facebook provides a better forum in which to show off your knowledge to a wide audience, resulting in more serendipitous "meetings" that result in engagements. Even so, more respondents to the survey use LinkedIn than Facebook (92% vs. 69%, respectively).
I have more than once mourned what I perceive as the loss of real writing on the web in the movement of the masses from "traditional" blogging to Facebook, Twitter, and other social media sites. Avery echoed that sentiment, saying that consultants still need to keep their own blogs going -- that's where you really show your stuff, and use Facebook and the like to link to your more detailed writing as well as to discuss it more informally. Almost everyone is on Facebook, so it's a good place to cast a wide net.
It's difficult to say how much of this applies to IT consulting. The respondents to the WIC survey are 89% female, 79% are in the San Francisco Bay area, 94% with 10 or more years in their field, with more than half in marketing consulting. Our overlap could be small.
TechRepublic's 2010 salary survey indicates that the average raise in our field increased from 6% to 10%, but fewer people were getting those raises (from 70% down to 43%). This survey also reflected a cautious optimism regarding the near future, with 55% predicted increased growth by the end of 2010.
For consultants and other contractors, it's hit or miss even trying to find out what people make these days, as seen from the following wide ranges of current rates from Hot Gigs:
The number you can get depends a lot more on your client and your experience than it does on the market in general. In my case, I had an unexpected increase in revenue last year of about 20% over the year before -- but a large part of that increase came from a single engagement. Was I propelled forward by the trend, or by good fortune and the relationships I had built coming home to roost? Perhaps a stronger market removes some impediments to success, but making it happen for your own business still comes down to exerting intelligent effort -- even if that effort ends up on Facebook.
Related TechRepublic resources
- Download: TechRepublic 2010 IT skills and salary report
- Make more money without getting new clients
- Promoting an IT consultancy via social media: The drawbacks and the benefits
- 10 ways to use social networking tools to promote your business
- 10 things you should cover in your social networking policy
- 10 ways to stay out of trouble when you post to social networking sites