Key points:
- Three questions reveal tool quality: Where does this data come from? How well does it match my exact situation? How fresh is it really?
- Free tools create expensive mistakes: Self-reported data from Glassdoor suffers from bias, potentially costing you in bad hire replacements.
- Real-time beats annual surveys: Legacy providers offer 6-12-month-old data for €10,000-100,000+, while modern platforms like Figures deliver monthly updates from €2,500/year.
- European companies need European solutions: US-heavy surveys miss local nuances – genuine European coverage means granular data for Berlin, Barcelona, and beyond.
- Evidence transforms conversations: Replace "market research suggests" with "According to real-time data from 127 similar European tech companies…" – proper tools give you the vocabulary to defend every decision.
Ever compare three salary benchmarking tools only to get three wildly different numbers for the same role? You’re not alone. The market’s flooded with platforms promising “real-time data” and “competitive insights,” but most HR teams end up more confused than confident.
Here’s the good news: You can cut through the marketing fluff with just three strategic questions. These questions transform tool selection from overwhelming guesswork into a clear, defendable decision.
By the end of this guide, you’ll evaluate any benchmarking platform like a pro – spotting the difference between genuine value and expensive spreadsheets in disguise.
What salary benchmarking tools actually do (and why you need one yesterday)
Salary benchmarking tools are platforms that compare your compensation against verified market data. They transform scattered salary information into defensible compensation decisions.
But here’s the real magic: they solve a trust problem, not just a data problem. When you tell your CFO that a senior engineer needs a 10% raise, “I averaged three websites” is like telling your doctor 'I diagnosed myself on the internet’. You need credible, verifiable sources that stand up to scrutiny.
Think about the last time you relied on Glassdoor or informal networking to set salaries. The data varies wildly because it’s self-reported – people share salaries when they’re either thrilled or furious, rarely when they’re content. That engineering role showing €45,000 on one site and €75,000 on another? Neither number helps when you’re defending budget decisions to the board.
In short, user-reported platforms suffer from selection bias, outdated annual surveys miss market shifts, and word-of-mouth intel lacks context about company size, location, or actual responsibilities.
What’s the alternative then? The answer is modern benchmarking tools. They deliver something different: real-time data from verified sources, filtered by your exact criteria. Most of all, they provide the evidence you need to make fair, competitive offers that won’t blow your budget or lose you talent.
And if you think there’s enough time and finding one isn’t urgent, just think about the following: while you wait for next year’s data, your competitors are already adjusting salaries based on this quarter’s reality.
Three questions that expose whether any tool matches your needs
Tools are foundational to any compensation strategy, but choosing between them feels like comparing apples to mystery fruit.
To help you out, here’s an example evaluation framework – three questions that cut straight to what matters.
Master these questions and you’ll transform tool selection forever. No more drowning in feature lists or fancy dashboards. Just clear answers about fundamental fit.
1. Does the data match your company profile?
Relevance beats volume every time. A million data points mean nothing if none match your specific needs.
Start with precision: Can you filter for “Senior DevOps Engineer in Paris at a 200-person company?” If the answer involves creative workarounds or “close enough” compromises, keep looking.
Check the granularity that matters:
- Industry specificity – Tech compensation differs wildly from manufacturing.
- Location precision – "Europe" isn't enough when Berlin pays differently than Barcelona.
- Company size brackets – Your 200-person startup isn’t comparable to a 2,000-person enterprise.
- Data depth – Job families, experience levels, equity packages.
⚠️ Don’t forget compliance. European companies need GDPR-compliant platforms with proper data residency. Security certifications such as SOC 2 and ISO 27001 are essential when handling sensitive compensation data.
The perfect match covers your exact profile, not approximations.
2. How trustworthy, recent, and comprehensive is the data?
Great benchmarking tools give you data that you can trust with confidence because they’re clear about its origin and level of reliability. In simple terms, you need data from accurate and up-to-date sources, so when you need information about the last quarter, that’s exactly what you’re getting.
What you need to remember is that HRIS-verified data beats self-reported numbers every time. When platforms pull directly from payroll systems, you get actual salaries, not hopeful estimates or angry exaggerations. Self-reported data? That’s like asking people their weight at the gym – expect creative interpretations.
Here’s why currency matters: using 12-month-old surveys when markets shift quarterly just doesn’t work. Hot skills command premiums overnight. That 6-month delay? It’s the difference between competitive offers and watching top talent join competitors who moved faster with fresher data.
3. Does the tool integrate with and simplify your workflow?
Even the fanciest platform becomes worthless if it doesn’t fit your reality. Watch out for these factors:
- Implementation timelines. Ask yourself honestly: “Can I get my first benchmark before my review meeting next week?” If onboarding takes months, you’ll miss critical decisions while learning the system.
- Customer support. Generic helpdesks that treat you like ticket #47,293? Pass. You need a dedicated team that understands compensation nuances and responds like actual humans who care about your success.
- Integration capabilities. Can it connect with your HRIS? Export to your preferred formats? Share insights with stakeholders who aren’t compensation experts?
"The best compensation tool is the one that doesn't make you feel like you need a PhD to use it," says Agnès Chauvigny, VP People at Figures. "You have actual work to do, not another system to master. You want to go from login to 'aha!' in minutes."
Free data vs. paid tools: when Glassdoor works and when you need more
Let’s be honest – we’ve all started our salary research journey the same way, but late-night Glassdoor scrolling is basically the compensation equivalent of WebMD-ing your symptoms.
Besides Glassdoor, other free resources include Indeed's salary tool and government databases. However, besides being “free” in the monetary sense, they’re also free of the context you need to defend them. In simple words, they don’t explain any of their findings, and without verification methods or filtering for company size and location specifics, you’re just not working with viable data.
Picture this scenario: you use Glassdoor data showing €45,000 for a developer role. Your competitor uses verified data showing the actual market rate is €55,000. Guess who gets the developer?
Or worse – you overpay based on inflated self-reported data. Glassdoor omits many compensation elements that employers factor in, meaning those numbers could be misleading in either direction. That “competitive” offer you made? It might have been way off the mark.
The ROI reality check: research by Oxford Economics and Unum suggests staff turnover costs businesses an average of £30,614 per employee – that’s roughly €35,000. It is estimated that replacing an individual employee can cost an employer one-half to two times the employee’s annual salary in most cases and up to 4x the salary for specialised staff.
For a €60,000 role, you’re looking at €30,000-120,000 in replacement costs. Meanwhile, a quality benchmarking tool costs €2,500-10,000 annually. One correctly-levelled hire pays for the tool and one avoided bad hire saves you multiples of that investment.
Here’s what’s even more sobering: the CIPD's Resourcing and Talent Planning Report 2022 found that only 17% of respondents calculated the cost of labour turnover. Most companies don’t even know how much bad data is costing them.
💡 If you think good data is expensive, try making decisions with bad data.
Salary benchmarking tools: features, costs, and considerations
When it comes to professional benchmarking tools, you’re looking at two distinct camps: legacy survey providers and modern real-time platforms.
Legacy survey providers
Radford (now part of Aon) and Willis Towers Watson dominate the traditional market. The Radford McLagan Compensation Database covers nearly 9,000 organisations with over 30 million employees across 100+ countries. Willis Towers Watson reflects salary data on more than 32 million employees in 11,000 unique organisations across more than 130 countries.
The price tag? Brace yourself. These enterprise solutions run €10,000-100,000+ annually, depending on company size, geographic coverage, and customisation needs. That's a serious investment, especially for smaller HR teams.
Why do companies still choose them? Three words: board-level credibility. When you present Radford data to executives, nobody questions the source. These brands carry decades of reputation, making budget approvals smoother. They also offer:
- Extensive customisation options.
- Deep industry-specific insights.
- Comprehensive global coverage.
The catch? Salary surveys are typically conducted annually, meaning you're often working with data that's 6-12 months old. Plus, the platforms can feel like navigating a 1990s database – functional but frustrating.
The real-time platform revolution
Enter modern platforms like Ravio and Figures. While they may lack the legacy brand recognition, they compensate with serious advantages:
- Fresh data: HRIS integrations mean monthly updates, not annual snapshots.
- Speed: Get benchmarks in minutes, not weeks.
- User experience: Modern interfaces that don't require a manual.
- Internal comparison: See how your employees stack against market rates instantly.
- Additional tools: Built-in compensation planning, pay equity analysis, and salary band creation.
The key differentiator? Real-time benchmarking tools like Figures offer a much more reliable source of market data (3.5M data points!) because markets shift faster than annual surveys can track. Figures is also SOC 2 Type 2 and ISO 27001 certified, making it an extremely secure platform for employee data.
Transform your benchmarking strategy with Figures
Here’s where things get interesting. Figures x Mercer delivers the best of both worlds – Mercer’s enterprise-grade depth (3.5 million+ data points) wrapped in Figures’ modern, real-time platform. It’s like getting a Rolls-Royce engine in a Tesla interface.
This combination solves a critical problem: US-heavy surveys that treat European markets as an afterthought. While competitors offer “European coverage” (often just London data with continental guesswork), Figures provides genuinely granular insights for Berlin, Paris, Barcelona, Amsterdam, and beyond.
Perfect for:
- Fast-growing companies (250-5000 employees) needing agility without sacrificing accuracy.
- Traditional enterprises wanting modern tools with legacy credibility.
- Multi-country European operations requiring local precision.
"Instead of searching the World Wide Web for hours looking for compensation benchmarking data, Mansa finds reliable benchmarking data for the exact positions they are hiring for," shares Paul de Preville, VP Sales at Mansa.
How do you benchmark salaries? With Figures, it's refreshingly simple:
- Connect your HRIS for automatic employee data sync.
- Filter by location, industry, company size, and role.
- View real-time market percentiles (P25, P50, P75).
- Compare your team against market instantly.
- Export insights for stakeholder presentations.
What separates premium tools from basic options? Transparency and support.
Figures shows exactly where data comes from and you see contributing companies, data freshness, and sample sizes. Combined with 3.5M+ European data points refreshed monthly, you’re making decisions on solid ground, not shifting sand. Beyond that, the Figures team can be an invaluable part of your compensation journey, like Mathilde Fontaine from Welcome to the Jungle saw for herself:
“Once we had set our policy, Figures enabled us to establish our concepts.” She particularly appreciated Figures' ease of use and the support offered at every stage of the process: “…The solution also helped us to ask ourselves the right questions, step by step. In particular, advice was given on granularity and salary ranges, which was very interesting. I couldn't have done the exercise without it. I also drew a lot of inspiration from the Notion pages created by Figures on compensation policy.”
Create defensible, competitive salary bands in minutes
Smart compensation decisions require more than competitive pay – they demand bulletproof justifications. When your CFO questions that senior engineer’s salary band, you need confidence-building language at your fingertips.
Picture walking into that meeting armed with: "According to real-time data from 127 similar European tech companies in our revenue bracket, this range represents the 50th-75th percentile for senior engineers in Berlin."
That’s the power of evidence-based vocabulary. No more vague “market research suggests” statements. Instead, you get:
- “Based on HRIS-verified data from companies with 200-500 employees…”
- “Current Q3 benchmarks show a 12% increase in this role since January…”
- “Among GDPR-compliant European firms, the median compensation includes…”
European companies face unique challenges: US-centric tools miss local nuances, generic surveys lack GDPR compliance, and market depth varies wildly between Copenhagen and Cluj-Napoca.
Figures addresses these exact pain points with 3.5 million data points powered by Mercer's methodology, built-in GDPR-compliance by design, European market expertise, and local depth that actually reflects your reality.
Ready to transform compensation conversations from defensive to definitive? Book your demo today.
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