There were a number of significant announcements and events over the past four weeks that, from my reading, seem to be compelling evidence that the new era of recruitment advertising and candidate attraction has officially announced itself as serious and here to stay.
Here’s the chronological sequence of announcements and events:
29 April 2011 – Fairfax Media announce that they are shutting down their candidate database product MyCareer Head Hunter due to poor employer/advertiser support.
10 May 2011 – A London stock analysis firm predicts that Facebook’s ad revenue would nearly double this calendar year from USD$1.8 billion to USD$3.5 billion.
12 May 2011 – Fairfax Media CEO, Greg Hywood, announces that Fairfax would outsource its newspaper sub-editing and 82 staff would be made redundant. This announcement does nothing to stop the freefall in Fairfax Media’s share price (down 15% in May alone, to a new record low of $1.09 on 20 May 2011).
13 May 2011 – Seek announces a price rise of 9% for its Australian customers, effective 1 July 2011, a huge jump compared to its New Zealand price rise announced a week later (3%) and the current Australian inflation rate (3.3%).
19 May 2011 – LinkedIn’s IPO exceeds even the most optimistic analysts’ forecast with the LinkedIn share price more than doubling on its first day of trading to reach USD$94, making an instant multi-billionaire of founder Reid Hoffman.
My conclusion on this sequence of events is:
Print media job advertising is in a coma (along with their old media owners). The heyday of print media job advertising was in the mid-1990s. The economy was growing, Seek had not been launched and the only alternative to newspaper advertising was sticking a Position(s) Vacant sign outside your premises (or on the front window). Fourteen years on from the launch of Seek, print media job advertising is unconscious and only a faint heart rate is detected.
The job board heyday is now over, although I am not predicting the death of jobs boards any time soon. Seek is still highly profitable (2009/2010 operating profit of AUD$109 million on sales of AUD$282 million) but their reliance on Australian job board revenue diminishes as they invest more money in overseas job sites and building their profile and success in selling the programs of external education providers.
Last month, Seek, clearly sweating at the huge local and global momentum of LinkedIn, announced major changes to its candidate database. Regardless of Seek’s profitability and growth, the share market remains unconvinced.
The All-ordinaries index is roughly where it was 12 months ago, whereas Seek’s share price has declined just over 15% in the same period. The massive price rise for Seek’s Australian customers is surely a last gasp to chisel the most amount of money from their loyal customers before these customers inevitably wake-up and spend more time and money on generating candidates via Facebook and LinkedIn.
It’s easy, in hindsight, to see the progression from era to era and how it occurred.
Newspapers worked for job advertising in its heyday (pre commercial internet) because it was the best available way to attract candidates. Its flaws are now very obvious – the job seeker needed to buy or find the relevant paper, the relevant ad needed to be located then an application needed to be sent in hard copy. All of these steps were both time consuming and imposed a direct financial cost on job seekers.
Job boards were just an improved version of print media. The best improvements being that a job ad had an online life of many days or weeks, relevant ads could be easily located using a defined search criteria and a potentially unlimited number of applications could be made by a job seeker for $0 direct cost.
What job boards couldn’t do, that newspapers could still do to some extent, was tap into passive job seekers. Job board ads were, almost always, only seen by active job seekers searching online for jobs. Newspapers still survived in the job board age because they offered some hope of advertiser access to passive job seekers.
The new era changes the game for both newspapers and job boards.
The very rapid rise in value, of both Facebook and LinkedIn, is all about the power of those sites to very accurately target users with very specific ads.
This is due to the willingness of Facebook and LinkedIn users to provide large amounts of accurate information about themselves, both personally (their likes and dislikes) and professionally (their education and work history).
This detailed information is the Holy Grail for advertisers/clients as it allows these advertisers/clients to find and target a very specific demographic at a price that makes any other form of advertising (print and job board) seem like very expensive post-and-pray stuff.
Is it any wonder that the big end of town are falling over themselves to transfer their job advertising and candidate sourcing spend to LinkedIn and Facebook?
This is exactly why LinkedIn’s Job Listings service more than tripled its revenue between 2009 and 2010.
Fairfax Media desperately cuts costs and hopes to survive. Seek raises prices, diversifies and hopes to prosper.
Meanwhile LinkedIn and Facebook power on, driving as many users as possible to their respective sites, encouraging those users to both provide as much information about themselves as possible and to maximise each person’s site user time.
Welcome to the new era of candidate sourcing and advertising – it’s officially here.