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Employer brands not fit for purpose, says new study

£800,000+ cost savings for companies that transform employer brands

Global employers are failing to attract the right mix of talent, despite wide-ranging efforts to improve the appeal of their employment brand. According to a new study by member-based advisory company CEB, a radical shift in focus is needed in the way companies approach their positioning. By building a brand that influences the best candidates to apply while dissuading others, organizations can improve applicant pool quality by 54 percent and quality of hire by 9 percent. At the same time, they will hire more high performers, experience a reduction in new hire turnover and can ultimately see improved profitability and a savings of $1.4 million (£837,270) on average.

78 percent of companies across the globe have undertaken a formal employer branding initiative over the past three years but, in doing so, have simply succeeded in attracting more – not better – people. During the same three-year period, the median number of applicants per open position rose by 33 percent to reach 40 people for every vacancy, but only 28 percent of candidates in this bigger pool are high-quality applicants.

In their bid to win the war for talent, companies have been ramping up efforts to become known as a great place to work. Organisations typically apply marketing techniques to recruitment – they create a core brand with universally appealing messages and communicate these using an average of six different brand channels, including social media.

Such efforts are misplaced, as applicants don’t trust much of what they hear from employers. Over 60 percent of applicants say they are more sceptical today of what employers say about themselves than they were three years ago. They also look to other sources of information – candidates today only rely on the employer for 20 percent of information when looking to apply for roles.

Efforts need to shift from building an employment brand that appeals to everyone to helping people make an informed decision on whether or not to apply for a particular position.

Jean Martin, Executive Director at CEB explains:

“Today’s employers face greater challenges than ever in attracting the right mix of talent, especially as the economy allows for a move from survival to growth mode. As businesses diversify their products and services, they have to hire people with skills their brand was never designed to attract. Globalisation is leading companies into new geographies and labour markets where they are unknown or perceived differently than in their home country.

“Employers simply cannot carry on doing what they’ve always done. Branding for universal appeal just results in more headache for the HR team who have to sift through a greater volume of low-grade candidates. Companies have to stop chasing universal popularity and adapt a ‘lure the best, deflect the rest’ mindset to employment branding”.

CEB has proposed a three-point plan to help organisations build more successful brands as employers.

1)    Focus. Shift from branding to a wider array of talent to customising more deeply to your most important talent segments

2)    Consult, don’t sell. Use messages that challenge applicants’ thinking rather than highlight selling points and perks

3)    Think people, not channels. Most people’s decisions on whether to apply for a given opportunity rest on informal rather than organisational sources. Focus less on managing branded channel strategies and more on managing internal and external influencers such as your employees and alumni.