Companies often focus on their consumer branding, which is how their customers and prospects perceive them. However, there is strong evidence that employer branding – a company’s reputation as an employer – is equally important. Why is this?
Far from being a buzzword, employer branding is becoming increasingly important because it defines your company and makes you stand out for candidates who are looking for jobs. This, in turn, helps your recruiting team attract and improve your talent pool of applicants.
Despite many company leaders talking about growing their employer brand, often nothing much gets done. Reasons given include lack of resources, a poor understanding of what building an employer brand entails, no budget, or weak buy-in at a senior level. If you work in the talent or HR function of a business, you’ve probably heard all of these.
Unemployment in New Zealand currently sits at around 3.8% (well done Jacinda). While this is good news for NZ Inc, it isn’t great if you’re a company looking for double-digit growth and you need good people to drive it.
And, when you starting delving into niche skills like tech or healthcare, the unemployment number drops even further – below 1%. As a recruiter, this means the developers and nurses you’re looking for are all sadly employed. This poses a real and serious problem and illustrates why a positive employer brand is so valuable for recruitment.
1. It helps retain employees and recruit new ones. A strong employer brand with a good company culture makes your employees proud to be with you. This comes through in your communication channels, including social media, which in turn is a big attractor for candidates. PWC reports, for example, that 88% of millennials look for employers with values that match their own.
2. Your employees become your advocates. Engaged employees become part of your recruiting team and as a result your hires through referrals increase. The more your employees talk positively about your company, the more this attracts good candidates.
3. It reduces costs. If you have a well-known employer brand, potential candidates will find you a lot more easily and apply for your vacant positions. This means that money you would otherwise spend on advertising can instead be spent elsewhere in your business. According to CareerBuilder, 67% of candidates are willing to accept lower pay if the company they are interested in has very positive online reviews. And LinkedIn says a company with a strong employer brand sees a 43% decrease in average cost per candidate they hire.
To illustrate these points, here’s a real-life example where we helped a large retailer looking for tech talent. It was a household name which everyone knew and had absolutely no problem with its consumer brand.
However, they needed developers and were struggling to find the right talent. We ran a campaign that showcased them as a progressive, forward-thinking e-commerce platform who were using the latest tech, offered cool minds to work with and lots of investment from the business. The outcome? Engagement! Lots of it.
And here’s another example to draw on if your execs push back on your request for investment to build your employer brand.
A global pharma company did some ROI calculations on the heavy investment it had made in building its employer brand, which had differentiated them from their competitors in a competitive market. It worked out that from candidates who chose to work for them based on their EVP, over two years they saved $1.4m in cost per hire, $500k in passive attraction and $1.5m in attrition rates.
These are big numbers, but they are calculated savings and they show the staggering results you can get from this little thing called employer brand.