Chrysler is predicting that 25% of its total sales will be online within 4 years. Already, dealers who join AutobyTel claim an average 30% increase in sales as the direct result of using the service which costs about $50K per year. 1600 car dealers are currently a part of the AutobyTel network. 1.5% of Chrysler's total sales were conducted online last year. (source: Edupage)

We find those numbers to be stunning and somewhat unexpected. We're sure that there are plenty of car dealers (as there are HR Managers and Recruiters) who are saying that the net is a passing fancy. Both markets are relatively fixed in size, so the 30% sales growth experienced by AutobyTel members is coming at the expense of other, less innovative, members of the industry. Our industry is much more fractured and harder to quantify. But, we are certain that the same dynamics apply.

We've been taken to task recently for our longstanding assertion that using "free" services is a fundamental mistake. Here's our reasoning:

Free only applies to the cost of placing the posting. It does not include the time and energy required to track, follow, format and maintain the posting. Given the general technical level and capacities of most recruiters, an active customer support function is required to build any significant posting volume. Generally speaking, the price of the posting is not a significant issue for recruiters. What is significant is the value of their time. "Free" services simply aren't capitalized well enough to deliver full recruiter end automation

Since banner advertising (the only viable alternative to subscriptions or per posting charges) only generates $.05 per ad (at the most optimistic), a given ad would have to be viewed by over 200 job hunters to generate $10 in revenue. With any level of complexity and volume in the database, this is a very unlikely number. What is even more unlikely is the notion that such a service would have an adequate sales force with which to generate advertising revenue. If it was easy to get ad revenue, you'd see tons of banners on job sites.

The few ads that get that sort of traffic will eventually cause a shift in focus on the part of the "free" job hunting service (again, customer support of some kind is a must in the business). The result is that over time, the site will specialize in certain types of jobs. As their focus narrows, so will the traffic. In other words, the give-away model has a built in downward spiral. The operations will never be in the black.

So, any recruiter who depends on the "free service" vehicle assumes a great deal of risk. If they make any sort of internal commitment to using the service over time (internal posting mechanisms etc), all of that investment is at risk. In services where a fee is charged, the service provider bears all of the above risk, freeing the recruiter to shift his resources more spontaneously.

Initially, Yahoo seems like an exception. But, though their ads are free, most are posted from other services as a distribution vehicle. In that very particular case, the revenue generated from banner ads is marginal (in the sense that the business does not depend on the revenue and it costs little or nothing to generate) , most of the service function is handled as a part of someone else's fee structure and so on. Yahoo is a great deal for the customers of the services (fee based) who automatically post their jobs to Yahoo. Usenet works much the same way these days.

Using and choosing vendors depends on the vendor's ability to survive economically. Choosing a vendor because there is no charge for their services is the highest form of folly. While competitors build relationships with suppliers that have a meaningful chance of long term survival, Recruiters who depend on free services end up as technology gypsies...chasing the next freebie and squandering the time that could be applied to making more placements. The bottom line is that "free" is much more expensive in the medium and long term.

 

Sourcing with Mailing Lists

Mailing lists vary significantly in frequency, content, tone and local culture. Essentially, they are all groups (communities) that communicate by sending email through the mailing list software. You send a piece of mail to the mail software and it distributes it to the rest of the group.

Essentially, there are three different types of mailing list (majordomo, listproc or listserv). The names refer to the software that operates the list. That's important because your ability to research the membership of a list depends on using the right instructions. Each piece of mailing list software has a different set of instructions. The most common type of mailing list is the "listserve" variety.

You can review many listserve groups by email. Send an email to this address:

listserv@listserv.net

Leave the subject line of the message blank.

At the top of the message body, write:

list global xyz

where xyz equals the term you are searching for. For example, sending the command

list global unix

will return a list of all known listservs relating to unix, including any and all lists that contain the string "unix".

It's important to know that every mailing list has two addresses One looks like this:

• listserv@domainname
• majordomo@domainname
• listproc@domainname

And is the address for the computer that administers the list. It is useful for finding out more about the list and, importantly, getting to know who subscribes to the list.

The other address looks like:

• net-lawyers@domainname
• adv-html@domainname
• ada-l@domainname

When you send mail to this address, it reaches all of the list subscribers.

No matter which type of list you are working with, you can always put one of two basic commands in the message of your email

• help
• info

Info will give you a description of the group and its contents. Help will list the various commands that you can use. With a bit of proficiency, and some attention to the dynamics of the mailing list, you can find the sorts of subject oriented passive candidates that make for effective recruiting.

Where's My Free Lunch

We try to help these folks peel back their frustrations. "Where did you post the job listing?", we might ask. Usually, the response is "On xxxxx" (one of the free job posting sites). Holding back on the urge to giggle, we politely suggest that you get what you pay for.

Like anything else, the net delivers rewards in proportion to your intelligent investment of money, time and energy. It's dangerous (and that's polite) to assume that you will receive a return simply because you invest. Looking for freebies is an avenue of rapidly diminishing returns.

Unfortunately, on the web and off, there are no free lunches. At this point in the evolution of Electronic Recruiting, it's terribly easy to buy the hype without understanding the price.

There's also a learning curve involved. We recently spoke with a Recruiter's recruiter who is hunting desperately for candidates who are seasoned Internet Recruiters. They are in short supply and very, very expensive. Why? Knowing where and how to effectively fish for candidates requires a combination of persistence, experience and the ability to adapt. Coupled with the required Internet proficiencies, the skills simply can't be mastered overnight.

This isn't to say that Electronic Recruiting is a loss. Rather, you have to expect the sort of learning curve involved in any new enterprise.

Birth of a Website

In the process of developing our 1997 Electronic Recruiting Index, we built a massive database of Information about and pointers to the Electronic Recruiting industry. This new website takes that data (for the Top 100) and presents it in a variety of formats.

One of the things we noticed about the industry as a whole is that there are no central sources of the sorts of detailed information on which decisions are made. Certainly, there is no shortage of comprehensive lists of sites. But, "drilling down" into the details of the web's complexity is more than a "top hits" list. The real work of comparison and information extraction is time consuming and tedious.

The other thing we noticed is that anyone, from job hunter to recruiter, who wishes to use the Web as an employment tool is faced with a bewildering array of interfaces. Each employment oriented site, in a valiant effort to display design prowess, uses different naming conventions and structure. This places a huge burden on job hunter and recruiting manager alike.

So, the Top 100 Electronic Recruiters Website is our modest attempt to deliver a standardized interface and to facilitate the sorts of comparison shopping and review that make an industry efficient.

Lots of credit is due. After the research for the report was finished, development of the site took our team much longer than we'd expected. Along the way, in a search for the simplest possible design, we passed through a couple subcontractors and three major designs. Site development is an intense occupation littered with the possibility of mistake and failure.

Our hats are off to the team that managed to make it to the finish line:

• Greg
• Steve
• Kevin
• Janet
• Colleen
• Nav
• Carrie

Take a look at Top 100 Electronic Recruiters Website. We're certain that it will boost your productive use of the web as a recruiting tool.

We'd be remiss if we didn't acknowledge the importance of our sponsors in the process. Thanks, in large bucketfuls, to:

• Bernard Hodes advertising
• Net Temps
• Best Jobs In The USA Today

There are a couple of advertising slots left. If you're trying to reach the employment marketplace, this is a reasonably central slot.

Push!

Most of the job hunting personal agents (4Work comes to mind) deliver packets of information about relevant opportunities to users who sign up for the service. This approach to "pushing" information to the user is at least a couple of years old in our industry. Does it work?

What we've seen is that

• It's much harder to turn off than it is to turn on
• Making the information relevant is difficult (always over or under done)
• Our audience is very transient. Rather than sustained needs, they leave as soon as they find work. This makes the administration of a push customer list very overhead intensive.

If we were building a recruiting site today, we probably wouldn't include a personal agent in the offering.

Will "push technology" emerge as an effective method for reaching candidates? These are very interesting times. The demographic dip and various labor shortages have allowed the introduction of television based recruiting (integrated with web sites) after a very long time. Anything is possible. As the recruiting stakes go up (and they will), we expect to see all sorts of experiments and investments. Right now, though, we have trouble imagining a process that would really work.

1997 Electronic Recruiting Index

• A comprehensive approach for designing and managing your web recruiting
• Detailed planning for placing online Employment ads
• A section written for managers of Internet Projects
• Pricing comparisons of 75 key Recruiting sites
• A detailed analysis of the Top 100 Websites
• A Directory of over 5800 Online Recruiters
• A solid look at the Recruiting Industry in 1996
• Forecasts and Trends for 1997and beyond
• The Impact of Demographics on Electronic Recruiting
• Motivations and Entry costs for the Various Market segments

• In the business and considering a change in strategy,
• Considering entering the business, or
• Trying to stay abreast of the changing landscape

interbiznet is now offering single topic reports for the Industry.

The first offerings are:

   The 21st Century Advertising Agency
   Recruitment Branding Part I
   Recruitment Branding Part II - The Mechanics

Email Colleen Gildea for your copy in PDF Format.

View Table of Contents at http://www.interbiznet.com/briefs/.

Order Today. Only $24.95.

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