Pioneering Data On-Demand: Salary.com CEO and Serial Entrepreneur Kent Plunkett (Part 4)

SM: What was the competitive landscape like when you started? Besides consultants, was there anyone else in that space at the time?

KP: Even today the competition is fairly scant. Back then there was no one doing it. We were alone in the consumer and enterprise business for a solid three or four years. There have been a couple of smaller companies that are trying to follow the path that we have blazed. I will leave it to others to discuss their success. We have maintained market success and been in the top 10 career sites by monthly visitors since inception. On the enterprise side, we figure we have over 90% market share of the people relying on compensation data within on-demand software to price jobs.

SM: I want to ask you about a company called PayScale. It provides user-generated content to offer the same value proposition. What is your read of that, and to what extent do you augment your data with user-generated content?

KP: We collect some user-generated content. We study and analyze it, but we do not use it in any of our products. We do it for research reasons only. HR professionals, who are our main customers, reject user-generated data. The information we collect is based on survey submissions or payroll records that come directly from corporations. That data is deemed much more reliable. The corporate is able to identify how to map the data together.

SM: Why does a corporation release salary data to a firm like Salary.com?

KP: Corporations want to understand what the market for pay is. They have a big initiative that says they want to know that they pay fairly. They need to know internal and external equity. Internal equity is how much you are paying your people versus what your intended pay structure is. External equity means you want to compare how you intend to pay your people with how those people would be paid by the market. To form an opinion of the market, firms have to give data to an independent third party, who aggregates all of that data and reports it back.

SM: You play the role of that third part?

KP: We play the role of the aggregator. There are a lot of other firms, especially compensation consulting firms, that do that as well. We probably have the largest single data survey for global pay in technology firms in iPass, a survey that covers all jobs in all the technology firms across 80 countries.

SM: How did you build the company from 2001 onward in terms of a sales model? You have a consumer model supported by ads, so was it the telesales channel on the enterprise side that carried you?

KP: I was pleased to see that in 2002 we had adopted your formula for Web 3.0. We believe you should sell to small businesses and enterprises and you should use telesales and deliver software-as-a-subscription products powered by on-demand software. We built a telesales organization and were able to demonstrate our products over the telephone and the Internet. We avoided the high costs of sales travel and traditional field sales.

We were able to sell so effectively over the telephone because we provided a live password to the product. We would just talk potential clients through a test drive. That resulted in a high conversion rate at a reasonable sales cost. Additionally, our brand became very strong. We have one of the most well-known brands in HR, and certainly within compensation we are the best-known brand. We were known as innovators and as a company that could make the work lives of our customers better.

This segment is part 4 in the series : Pioneering Data On-Demand: Salary.com CEO and Serial Entrepreneur Kent Plunkett
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