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Post-n-Pray vs Pay for Performance

Posted By: Thomas Shaw, 8:00am Monday 10 August 2009    Print Article

Is the Australian online recruitment market ever going to see a shift away from the traditional 'pay-to-post' model to a 'pay for performance' (P4P) revenue model? Pay for performance is also commonly referred to as pay-per-application (PPA) or pay-per-placement (PPP).

The pay-per-application model has been long touted as the way forward for job boards. It allows advertisers to pay for results rather praying for candidates to apply. ie. Advertiser only pays $ per resume received (could be capped at #apps or when reach $ level).

Pay-per-placement involves a much closer arrangement with the advertiser to follow the tracking of each candidate when they apply for a role - right through to placement.

These two performance models take a lot of the risk out of advertising because you don't pay unless the site delivers.


But these models are unsustainable through the economic cycle. When jobseekers are applying in abundance, no one wants to pay for them. When advertisers are happy to pay for any candidate going - there aren't any candidates!

1. Traffic - Forget about all the other generalist and niche job boards, according to Nielsen NetRatings July 2009 statistics, our market is dominated by 3 main players - SEEK, CareerOne & MyCareer.
  • SEEK 3.266 million unique browsers - up 6.8% from June
  • CareerOne 1.499 million unique browsers - down 0.5% from June
  • MyCareer 1.166 million unique browsers - up 9.8% from June
A job board needs to have enough candidate traffic (and application) for it to be profitable. How can you attract candidates if you have no money to find them? This is why most job boards fail.

2. Bypassing the System - How can you track or stop users directly contacting the advertiser and submitting the resume via another method? Nearly all job adverts will list the Recruiter/Employer, contact name, phone number, etc. If you can bypass the system, how can you charge the advertiser?

3. Quality - Is the site going to deliver quality candidates? The quality of an application is always going to be pretty subjective and difficult to measure.

4. Duplication - What happens if the candidate is already on your database? Will you still get charged?

5. Fraud - The models are subject to applicant fraud. Fake and bogus applications could push up the sites performance.

Overall, posting an online job advert in Australia is relatively inexpensive compared to other geographical markets. If one of the major job boards did change itís revenue model - would the others follow?

Recruiters/Employers first need to better understand where the candidate comes from (see my previous blog post on Tracking Candidate Sources) and understand that a job advert is also an advertising opportunity Ė your brand is on show.

I can't see how a pay-for-performance model is going to revolutionise our industry. I am keen to hear your thoughts on this topic.


Article URL: http://www.recruitmentdirectory.com.au/Blog/post-n-pray-vs-pay-for-performance-a244.html

Article Tags: pay to post pay for performance job board online recruitment p4p post n pray ppa ppp pay per application pay per placement advertising model seek seek.com.au careerone careerone.com.au mycareer mycareer.com.au nielsen netratings revenue model candidate tracking

Comments Hide Comments (3)

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 JasonGiller (12:31am Tuesday 11 August 2009)

Thomas,

The main benefit of using P4P is that YOU (the advertiser) can set a series of questions that allows you to filter out those candidates that are not appropriate.

http://www.my-ijob.com is part of the JobG8 network so in terms of traffic, 2 million unique for the UK and around 6 million for the US (according to the last stats).

Advertisers details are not displayed so there is no "direct contact info" available, you could of course see who the employer / recruiter is and find their details, I agree with you. But aren't we all trying to engage with the job seeker and make it as straight forward as possible for them to apply?

Re: Quality, this is really set by you (the advertiser) firstly in the quality of your copy and then of course with the series of questions YOU set, the tighter the question, the better the "Quality"

Re: Duplication, each applicant has a unique ID which makes it very very difficult for them to apply more than once (again assuming the meet you criteria), if candidates dont meet your criteria, we send them a polite email advising them, so no extra work for the recruiter.

When the "qualified" candidate get through YOUR questions, they can be delivered into an ATS or direct to an inbox of your choice.

Hope that helps


 Sara (7:22pm Friday 14 August 2009)

Hi Thomas,

Great post! I think I can answer some of the questions you have posed using JobServe's P4P product as an example.

1. Traffic - Robbie Cowling (who set up the first Job Board ever!) has started the Jobg8 network. Take a look at the membership page, there are over 50 job boards in the Aussie network with combined unique visitors traffic of 2.5 million browsers every month. JobServe is part of the Aussie Jobg8 network and has access to this traffic (like everyone else on the Network).

2. Bypassing the System - You are right, recruiters can be accessed via their contact telephone number, however as has been said in the previous post this does take away the easy-to-use user friendly application process that is completed within a matter of minutes without the hassle of contacting someone to discuss details you have already read. Aside from this, all recruiters that post are given a unique email address which can be tracked to follow an application. I'm sure other boards track likewise.

3.Quality - This is the huge benefit with P4P, the recruiter specifies exactly what type of candidate they want to attract by stipulating the questions they require each candidate to answer before applying for the position advertised. This creates a custom filtering service for each application assuring that it meets the quality requirements of the recruiter. Yes - candidates can lie - but they will get caught out eventually.

4.Duplication - If an applicant has already applied for the role, under JobServeís P4P, the recruiter will not be charged for duplicate applications however this duplication will rarely happen due to Jobg8s tracking and de-duping systems.

5. Fraud - Thomas - you are correct again, but (like Google PPC) JobServe refunds all payments made for fraudulent apps, no questions asked!

Why get numerous amounts of irrelevant C.V's when you can stipulate exactly what you receive? P4P saves personnel time which saves money so why wouldn't others follow?

Letís see what product the market prefers - Pay and Pray(that you get apps) or P4P.

Sara


 Sassy (12:45am Saturday 05 September 2009)

Will Pay For Performance Revolutionise online recruitment advertising? Heck yes!!! But revolutionists must get it right!!

1. It is a nod and perfect alignment with recruitment agencies who are paid per placement.

2. It is a perfect opportunity to get broad exposure for your harder to fill roles that you may have on multiple sites. P4P assures that your broad exposure is only an expense if it delivers value instead of intangible possibilities.

However, the defining element will be the cost per qualified application. Compare your cost per application against sites offering bulk discounts and has such good traffic that they end up delivering a good number of qualified applications amongst the thorns. Employers have become committed to sites even though they deliver some thorns because they know ultimately they will get a few good candidates.

P4P has tremendous possibilities if the price is right!!!


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