- Daisy Group’s referral scheme saved the business the equivalent of £330k on agency fees
- Almost 30% of Daisy hires now come through ‘word of mouth’ referral
- Social media is driving force behind successful referral schemes
Growing businesses that don’t take advantage of their employees’ networks could potentially be overspending on recruitment by hundreds of thousands of pounds, according to Daisy Group.
Although referral schemes are nothing new, the emergence of social media and professional networking sites, such as LinkedIn, have helped encourage employees to share posts and refer friends to specific vacancies.
Following an extensive review of its hires between October 2013 and October 2014, leading business communications provider, Daisy Group plc, has discovered that its employee referral scheme has helped save the firm the equivalent of £330k on recruitment agency fees.
Jo Clifford, Head of Recruitment at Daisy Group plc, said: “Our figures evidence the massive savings that businesses can make just through ‘word of mouth’ recruitment, or an employee referral scheme.
“By incentivising employees, fast-growing businesses that have a large number of vacancies, can make massive savings by eliminating the need to use a recruitment agency. The more staff recommend a business, the more it reflects that it is a great place to work, encouraging more people to apply for vacancies.”
Industry research* has found that as well as being less expensive to recruit, referral hires usually start their roles sooner; stay within a business longer; and better suit an organisation’s culture and values.
Daisy’s referral scheme rewards staff with a £250 cash bonus for successfully recommending an employee that passes their probation with the company. The firm has hired 141 staff through the scheme during the past year, 29% of its total hires.
Talking about the role of social media, Jo continued: “As well as word of mouth, social media platforms have enabled employees to share posts to their unique networks, ensuring vacancies are visible to a potentially enormous audience.
“If you imagine that each employee has on average 100 followers or connections on social media, and you then times this number by how many employees you have within a business, you can see that you soon have the potential to target a large amount of job seekers or passive candidates.”
Research also reveals online job boards still bring in the highest number of applicants; however their conversion-to-hire rates fall far behind referral schemes.