The product owner is arguably the most important member of the product development team. For this reason, the product owner salary tends to be on the higher end, as compared to related product team member salaries.
The rise in cross-functional product teams has resulted in product managers, developers, strategists, and product owners attaining a number of skills.
The product owner, in particular, is involved in multiple aspects of the product lifecycle.
Considering that, they are often well compensated.
However, with so many software and conventional product companies offering product owner jobs, it pays to know the average product owner salary, in order to make a better decision on where you want to apply.
In this article, I’ll explain what product owners actually do, and how their salary can vary according to experience level, rank, and location.
Let’s jump right in.
Product Owner Salary: What Does the Product Owner Position Entail?
A product owner is a leadership position within a product development, management, and marketing sphere.
They work with the product development teams throughout the lifecycle of the product, from concept to launch, and even track the product’s market performance.
The majority of product owner positions are in software companies or software support providers.
Product owners lead what’s called a scrum team, which is a group of stakeholders (usually the product team itself) who are responsible for delivering effective product increments. Scrum teams have open and active communication between members, as well as cross-functionality.
As scrum masters (leaders of the scrum team), product owners are expected to understand the requirements and pain points of the development team, as well as, the end-users.
They are required to gain the end-user perspective before, during, and after product development, and implement changes to the product at various development stages.
In addition to that, they work with closely related departments such as sales and marketing, as and when it’s needed.
Simply put, product owners are product analysts, senior business analysts, data analysts, technical product managers, and HR managers, all rolled into one job title.
Product Owner Responsibilities
Due to the cross-functional nature of the position, a product owner's job can come with multiple responsibilities. Some of the major product owner responsibilities are:
- Writing and capturing user needs and user stories to define product requirements and develop the product strategy.
- Scheduling and leading meetings with software engineers and technical staff to identify issues, develop fixes, and advance project cycles.
- Managing daily product schedules, objectives, and product backlog, while setting priorities according to customer expectations.
- Working with customers, internal teams, and stakeholders to develop and customize products.
- Actively collaborating with the Director of Operations and implementing positive feedback and advice into the product roadmap (in a DevOps setting).
Since most software firms today follow the Agile methodology, collaboration is very commonplace in product teams.
The responsibilities of a product owner are a direct reflection of the Agile methodology. This is why an agile product owner can also function as an agile coach in companies that are newly adopting those practices.
Depending on what sort of product development process a company follows, a product owner’s job description may change. However, the general tasks they perform on a day to day basis remain somewhat similar across the industry.
Academic and Experience Requirements for Product Owners
In terms of academic qualification, product owners should have at least a bachelor’s degree in a related field, such as business administration and/or management.
Some companies prefer their candidates to have a master’s in business administration(MBA) degree.
Most companies ask for at least 4-5 years of experience in product development when hiring a product owner. However, if you’re going in for a product owner internship, you only need to be enrolled in an undergraduate program for a business administration or management subject.
Since product ownership is a leadership position, you can apply for it if you’re already working as a technical project manager or senior product manager. In most cases, you won’t need experience specifically as a product owner.
The Average Product Owner Salary
According to Indeed.com, the national average for a product owner's salary is $110,045, with an average hourly rate of $58.10.
The common salary range for product owners is between $59,000 and $168,455. The majority of product owners fall into the median salary category, with just 20% (each) of professionals on the low and high end, respectively.
There are a lot of factors that go into employee salaries, especially in a diverse field such as product management and ownership.
A high-level understanding of agile product development in 2020, is an obvious plus.
Specific skills are also beneficial, especially in companies that require product owners to focus on one particular area of product development.
Out of all the factors though, experience and location are the prime ones that decide how much a product owner makes.
Product Owner Salary by Experience Level
As mentioned, this is a leadership position, and so, the salary is dictated by how much product development/ownership experience an individual has.
Let’s take a look at the average base salary of a product owner, based on their level of experience.
- Entry-level Product Owner: Average total compensation of $67,985, with less than a year of experience.
- Early Career Product Owner: Average total compensation of $77,656, with 1-4 years of experience.
- Mid-career Product Owner: Average total compensation of $92,619, with 5-9 years of experience.
- Experienced Product Owner: Average total compensation of $105, 021, with 10-19 years of experience.
- Senior Product Owner/Director of Product: Average total compensation of $109,765, with 20+ years of experience.
It’s important to note that these salaries are not reflective of the national average, and are a general average based on a large number of US cities.
These averages also include any additional cash compensation that an employee may receive, such as overtime, bonuses, tips, performance-based rewards, etc.)
Product Owner Salary by Location
Different states and cities in the United States have a different average salary for product owners.
Of course, product owner jobs in some cities pay more than other cities or even the national average. This is usually because there’s more scope for that particular position, in that city.
For example, a product owner in Los Angeles is obviously going to earn more than one in a less business-dense city.
Let’s take a look at which US cities are the best for product owner employees, in terms of average pay. Here, we’ll compare the average in each city to the national average.
- Seattle, Washington: $144,344 (31% more than the national average).
- Plano, Texas: $122,833 (12% more than the average).
- Richmond, Virginia: $120,852 (10% more than the average).
- New York City, New York: $120,709 (9% more than the average).
- Washington, DC: $118,402 (7.5% more than the average).
- Houston, Texas: $118,173 (7% more than the average).
- Chicago, Illinois: $114,084 (3.5% more than the average).
- Minneapolis, Minnesota: $111,322 (1% more than the average).
For most other cities, the average is similar or has a negligible difference to the national average.
How to Choose a Company with the Best Product Owner Salary
Considering the data given in this article, the obvious answer here would be to Google it and look through job boards such as Glassdoor, Indeed, Payscale, etc. for the best-paying companies.
However, just like a project manager, there is more to a product owner’s growth trajectory than simply a good initial salary.
In case you’re looking to start your product ownership career, here are some steps you can follow to choose a company with the best product owner salary.
- Make a list of all your primary, secondary, and tertiary skills in the area of product development.
- Find out which skills you can capitalize on for better paying jobs, and if there any skills you need to develop.
- Create an ideal career trajectory for yourself, at least 20 years into the future.
- Look for companies that require the skills you have and offer the career trajectory you want.
- Shortlist companies based on salary increments, benefits, location, and type of company (software development firms are best in the product owner category).
- Apply for the company with the best initial salary package.
In conclusion, it’s important to have a career roadmap set out for yourself, before you apply for any position.
If you are new to product management and are looking to break into your first product role, we recommend taking our One Week PM course, where you will learn fundamentals of product management, launch your own product, and get on the fast track towards landing your first product job.
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