Are you working in talent acquisition and staring at a long list of open vacancies, rising levels of candidate drop out, increased turnover and spiraling recruitment costs? If yes, your candidates are telling you something loud and clear – they don’t like your employer brand. And, as you’ve probably already realised, that causes a whole host of problems
The good news is that you can address this. Brands can be revived and perceptions changed but it takes time. It’s far better to avoid the damage a poor employer brand can cause at the outset. Think of us as your employer brand doctor with a message that prevention is better than cure.
If you are feeling the heat, you’ll need a little help and that usually requires a mini business case to show what a poor employer brand actually costs. We’ve got a few stats to help with that. We’ll also share some tips to avoid the problem in the first place.
Just what is your employer brand?
Let’s start with a reality check. You already have an employer brand. It’s what your employees (existing and past) think about what it’s like to work for you. And it’s also about the perception candidates have about working for you. In both instances, it’s not what you think – it’s what they think.
Here’s why what they think matters. Research by LinkedIn found that 75% of job seekers consider an employer’s brand before even applying for a job (LinkedIn, 2021).
And, just like any brand, your employer brand needs ongoing management and refining. Many of the problems start when it doesn’t get that – or if promises made aren’t met by reality.
The cost implications of a poor employer brand
Costs can be measured in a number of ways and are often more than purely financial. But eventually everything does boil down to money, whether that’s in the cost of replacement talent, lost productivity and, as we’ll show, even lost customers.
Here are just a few:
The cost of candidate fallout: Candidate attraction is hard enough without losing them before they’ve even joined. A Glassdoor study from 2022 found that some organisations are experiencing a dropout rate as high as 80%. A poor employer brand will do nothing to help and may well be a contributory factor due to candidate underwhelm.
Drop in candidate quality: A poor employer brand won’t put everyone off – but good candidates will probably go elsewhere. As a consequence, you risk the cost of attracting those candidates less engaged with your values and more interested in finding a job until a better one comes along. And you may have to pay more to entice lesser candidates too.
Cost of increased turnover: Linkedin found that a good employer brand can reduce turnover by up to 28%. Those engaged with the employer brand and who find the reality has matched the promise are likely to stay – no major surprise there. But flip that to the impact of a poor employer brand and that 28% advantage is likely go – to be replaced by the costs associated with replacement in both budget and time.
Costs of replacing talent: If the effect of your experienced employer brand causes turnover, that can be expensive, especially if they’ve only stayed a few months and never reached the level of expected productivity. Data from the Work Institute estimates that each lost employee costs their employer, on average, one-third of their annual salary. By comparison, Linkedin found that a good employer brand had the pulling power to decrease cost per hire by up to 43% (LinkedIn, 2021).
Cost of increased reliance on agencies: One of the advantages of a strong employer brand is the inbound interest from candidates that aspire to work for what they see as an attractive employer. When that brand has a poor reputation, that well runs dry – leaving you paying the costs associated with agencies. Generally, the average recruitment agency will charge a percentage of the candidate’s first-year salary, from 10 to 30%.
Cost of lower engagement and productivity: Employees who are inspired by a strong employer brand tend to respond with better engagement and the productivity that comes with it. This is borne out by research by Gallup which found that companies with engaged employees experience 23% higher profits.
The cost of lost customers: Customers have a view on your employer brand and they experience it when they become candidates. As this true story demonstrates, a poor candidate experience can ruin the customer relationship and at great cost. In 2014, Virgin Media surveyed its rejected applicants to find that 18 percent were customers, 6 percent of whom switched to a competitor due to a poor candidate experience. This roughly cost Virgin £4.4 million pounds in lost revenue – almost equaling their entire recruiting budget that year.
The cost of internal frustration: A poor employer brand can cause a lot of blame and frustration. Hiring managers blame internal recruiters who may themselves blame their marketing department if they own the employer brand – and they may blame their agency. The buck often stops with the talent acquisition team so avoiding any of this blame culture can only be good news – and you can’t put a price on that!
Want to fix your employer brand?
Perceptions of your employer brand may not aways have been poor. So much has changed in what employees want from their employer these past few years it might have fallen out of alignment with their needs and values. Any brand needs looking after, so let’s start here.
Review your Employer Value Proposition (EVP): Employees have been through a lot, and many are still grappling with the coast of living crisis. They need flexible working to enable them to balance busy lives and recognising their contribution always helps too. It’s possible your EVP doesn’t deliver in these areas and a little reflection could bring about improvements that could really lift how the overall brand is perceived. Our friends at BrandPointZero have written an article on just this and we think it’s a great resource to help. Read ‘How to make your EVP work harder’.
Differentiate – adapt your EVP for different audiences: Just as consumer brands segment and create different versions of a brand for their varied customer base, the same goes for the employer brand. If things appear to be just that bit too bland or generic across the business, you probably aren’t telling the individual stories you need to. What appeals to your tech candidates won’t appeal to your lawyers or customer service markets. So, adapt your message and content to better reach your different candidate groups. You can see an example of this in our case study for NFU Mutual. They asked us to help them capture the essence of working in the pricing team – and that led to a very targeted EVP to bring that proposition to life. Read ‘Developing an EVP and creative campaign for pricing professionals‘.
Don’t stop at the candidate experience: A lot of focus is now given to the importance of the candidate experience and that’s no bad thing. We covered the issue of candidate drop out. This costs in terms of wasted time, frustration and perhaps the fees associated with agencies – all of which can be avoided if the candidate experience is better. So, please read our article ‘Candidate experience: How to meet and exceed their expectations’ but don’t forget to carry those good experiences through into equally good on-boarding as that’s the time new hires will be evaluating promises against reality.
Re-engage candidates with your employer brand: When you have done all or some of this it’s time to take that story out to your different candidate groups. To do this well, you’ll need to share your stories through a content strategy. It’s how you build trust in your employer brand, engage with and nurture candidates as well as renew the belief of existing employees. To help you do this, we wrote an article called ‘Content marketing for recruiters. Engaging candidates with your employer brand’.
In conclusion
A poorly perceived employer brand creates more costs than you might think. It’s not just time or recruitment fees, and there’s no quick fix the longer things are left as they are. Reputation can suffer too, along with wider customer loyalty. So, it’s worth focusing on whether your EVP still delivers what your people want or need and adapting your message to more closely resonate with your target candidate groups. After all, the proof of a good employer brand is in what they think. And if you need a little help in influencing that, that’s what we do.
Need a little help?
If you feel that you’d like some help, support or even a little chat around your careers website or aspect of your employer brand and talent attraction strategy just drop us a line. After all, much of our best work has started with a cup of tea and a Zoom call.
Photo by Sergei Wing on Unsplash
