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(This post is a response to “Are Data Scientists Overpaid?” – ed. note)
The answer? Fake data scientists are overpaid, real ones underpaid.
Read Fake Data Science and Horizontal vs. Vertical Data Scientist. Many real data scientists are actually unemployed and can’t find a job. The number of applicants per job ad ranges from 20 to 500 – you can check these numbers yourself on LinkedIn, entering the keyword “data science” in the “Job Search” box (top right corner, select “Jobs” as search criterion).
In my case, as a data scientist, I generate leads for marketers. A good quality lead is worth $40. The costs associated with producing one lead is $10. It requires data science to efficiently generate a large number of highly relevant leads, purchasing the right traffic, organic growth optimization etc. If I can’t generate at least 10,000 leads a year, nobody will buy due to low volume. If my leads don’t convert in actual revenue and produce ROI for the client, nobody will buy.
Also, thanks to data science, I can sell leads for a lower price than competitors – much less than $40. For instance our newsletter open rate went from 8% to 24%, significantly boosting revenue and lowering costs. We also reduced churn to a point where we actually grow, all of this thanks to data science. Among the techniques used: improving user, client and content segmentation; optimizing delivery rate from an engineering point of view, eliminating inactive members, detecting and killing spammers, and optimizing a very various mix of newsletter metrics (keywords in subject line, HTML code, content blend, ratio of commercial vs. organic content, keyword variance to avoid burn out, first sentence in each message, levers associated with re-tweets, word-of-mouth and going viral, etc.) to increase total clicks, leads and conversions delivered to clients. Also, we need to predict sales and revenues – another data science exercise.
Am I overpaid if I can deliver the leads with a higher margin and lower price? No, I’m just smarter than competition. I’ve also developed a business model that is not subject to click fraud, thus avoiding losses and litigation. At the end of the year, my revenue after cost is far above the $133k mentioned by ZDNet, yet I don’t feel overpaid, and my clients don’t feel that our service is expensive – if they did they would stop working with us.
Rule of thumb: You are overpaid if your company makes less than 3 times your salary, from your work. No matter how much or little you are paid. By making money, I mean revenue generation or cost savings. By revenue, I mean extra money resulting e.g. from optimizing ad campaigns. Not always easy to measure the financial lift that an employee brings to a company.