Are you hiring a chief revenue officer and a VP of Sales to grow your business? These two sales leadership roles have common ground. They are both accountable for leading sales function. There are essential distinctions between these roles. Pick the proper role, and your image will be enhanced, and you may find recruiting more difficult.
VP of Sales Vs. Chief Revenue Officer By The Numbers
To compare these two job roles, we turned to LinkedIn to see which one is more popular. Our findings might surprise you if you live and work in the technology industry.
- Number of Chief Revenue Officers: 15,000 in the US (2800 in California, 18.6% of total)
- Number of Vice President of Sales: 231,000 in the US (27,000 in California, 11.6% of total)
In terms of raw numbers, VP of Sales is far more common. The story changed a bit when we took a closer look at California, home of countless technology companies. The Chief Revenue Officer appears to be more popular in the Golden State.
That’s the first observation to keep in mind – chief revenue officers tend to be more prevalent in the technology and startup industries.
Chief Revenue Officer vs. VP of Sales: Salary and Compensation
Aside from popularity, compensation is another crucial difference between these titles. Let’s look at a few sources to see how income compares.
According to BuiltIn, a startup website, the average base salary for a chief revenue officer is $234,000 (with additional cash compensation of $169,000). That’s a total average compensation of $403,000 – high enough to put you in the top 5% of US income earners, according to CNBC. That level of compensation makes sense when you consider the value of an outstanding sales leader in a high-growth company.
In comparison, the average salary of a Vice President of Sales in the US, according to Payscale, is $146,000. When you factor in bonuses, profit sharing, and commissions, the total pay ranges from $98,000 to $268,000. These national averages only tell part of the story, however.
Since the VP of Sales role is so diverse, we’ve explored the VP Sales Salaries in further depth in a previous post. Industries vary considerably in what they offer to VP of Sales – average VP pay in financial services is $135,000 while the average VP Sales salary in telecom is $185,000!
Does it make sense to pay chief revenue officers substantially more than a Vice President of Sales? It depends on several factors. For example, a chief revenue officer might have overall responsibility for the company’s entire sales strategy, while a VP of Sales might be responsible for a single product or region. Beyond responsibility, the local cost of living has a factor – $150,000 per year simply does not go as far in the San Francisco Bay Area.
To further understand which sales roles make sense for your needs, let’s take a look at the typical responsibilities for each role.
Chief Revenue Officer vs. VP of Sales: Key Responsibilities
To highlight the differences between these sales leadership roles, we looked at a few job postings in 2022.
Chief Revenue Officer Job Responsibilities
- Typically there is only one chief revenue officer in a company.
- Collaborate closely with senior management, including the CEO, Chief Operating Officer, and other leaders
- Responsible for every process to lead to revenue, which includes more than the sales team.
- Forecast and all revenue across the business
- Lead the sales team and influences other related areas, including pricing and marketing.
- Use data skills to manage sales and marketing to achieve revenue growth.
VP of Sales Job Responsibilities
- Depending on company size and complexity, there may be multiple VPs of Sales.
- Accountable for sales results in a defined area (i.e., a specific territory, product, etc.).
- The VP of Sales has management responsibility for the sales team, including overseeing promotion, talent acquisition, talent development, and related activities.
- The VP of Sales may have a personal sales quota to fulfill and their responsibility for their sales team.
Which Sales Leadership Role Is Right For Your Company?
To decide which sales leadership title is suitable for your circumstances, explore the following questions with your team.
1) What level of management responsibility does this role have?
Suppose the sales leadership role is accountable for managing a global sales group. On the other hand, a midsize company with operations in several states might have two or three VPs of Sales to cover each region.
2) Is your company in the technology industry?
Startups and large technology firms favor distinctive job titles like chief revenue officer. If your business is in the tech industry and you are looking for a leader to act as ‘the CEO of sales,’ then a chief revenue officer title may be appropriate.
3) What do you forecast for compensation?
Be realistic about what you are willing to pay your sales leader. If you have a $100,000 budget in mind with limited management responsibilities, then it may be wiser to focus your effort on a sales manager role with the potential to be promoted to a VP of Sales role.
One word of caution is in order when it comes to sales compensation. If you recruit a high performer, they will bring significant revenue to your business. Don’t let your historical sales compensation hold you from offering a competitive bonus program and commissions to your star sales performers.
You’re Not Alone: How To Get Support In Choosing Your Next Sales Leader
While job titles are significant, there is much more to find your next sales leader. You may find that the best sales leader isn’t applying to your job postings because sales leaders tend to be in high demand. That’s where working with Peak Sales Executive Search can be your secret weapon. Peak has helped many companies recruit sales managers, chief revenue officers, and sales executives. Contact us today to discuss your sales talent needs.
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