Why employer branding has become a priority for businesses
“Any customer can have a car painted any color that he wants, so long as it is black” (Henry Ford). 100 years ago, companies like Ford didn’t need great efforts to persuade the consumer. However, an increasing market complexity and competition forced companies to find new ways to attract customers. They found the solution in the strategies and tactics of modern marketing and branding: employer branding.
With some delay, something very similar happened in the labor market. During the last decades, the advent of computers and of artificial intelligence caused mass automation of low-skilled jobs and an ever-increasing complexity of the production systems. In this context, competition for highly skilled workers is higher than ever. As a result, companies today were forced to find new ways to recruit and retain new talent. This time, they found the solution in employer branding.
These two processes gave rise to brands that speak to several audiences simultaneously: While standard branding focuses primarily on clients, employer branding is all about crafting and communicating an attractive value proposition for current and potential employees.
In a related article from several months ago, we explained different methods to build trust, identification and loyalty, and thus recruit, elevate and retain talent. In this article we will focus on more specific issues. Up next, we will expose some of the key facts and benefits that make employer branding a priority for all businesses.
1. The employer branding strategy is NOT aimed at our clients
It’s self-evident, right? And yet, there are still those who cannot set aside the customer mindset.
A good employer branding strategy doesn’t necessarily have to make the company look “professional”. In fact, in many cases the strategy is exactly the opposite. Most people look for a casual and authentic workplace; an environment where everyone can be who they are, without having to conform to strict rules that in many cases only contribute to suffocate motivation.
The degree of “professionalism” of the employer branding strategy doesn’t have to affect the perception of our clients about the quality or seriousness of the value proposition. If there’s any doubt, just look at a company like Google: It offers its employees a super relaxed work environment, but nobody believes for a second that this will affect the company’s quality standards. The key is that the employer branding strategy is not aimed at customer. Different audiences, different value propositions.
Google’s career website for its finance sector.
2. It focuses on both professional and personal growth
According to Harvard Business Review, 9 out of 10 people are willing to earn less money in exchange for a job more aligned with their values.
Just as price is not the most important variable in the purchase decision, neither is salary in the employment decision. For this reason, the responsibility of employer branding goes far beyond attractively communicating the benefits offered by the company: Employer branding must help the business understand its current and potential employees, in order to contribute to the creation of a value proposition that meets their needs. In this way, employees will understand that, by working in the company, they will be able to grow not only on a professional but also on a personal level.
3. It builds a reputation in the relevant business sector
A company may not be known to the general public, but a good employer branding strategy will make the company recognized, and even admired, by the employees of the business sector. By building and communicating a value proposition that incorporates relevant benefits for employees and a workplace that expresses the corporate identity and internal culture—this is where employer branding meets corporate interior design—a company can become an aspirational place for the talents of the sector.
And this brings us to the last point…
4. Employer branding has very tangible and high-impact benefits
Well executed, a correct employer branding strategy will contribute to our business, since:
- It generates higher quality applications, which in turn lowers the cost of the search process (the company takes less time to find the ideal candidate).
- It increases the efficiency of head hunting (with a company that is highly recognized in the sector direct contact with potential candidates yields more positive results).
- It improves productivity within the company: According to studies, employer branding can help increase employee engagement by up to 120%.
- It reduces employee turnover rate by up to 28%. This not only shrinks HR costs since it isn’t necessary to recruit new candidates, but also reduces losses caused by projects disruptions.
In conclusion, not having the right employer branding strategy is a very big disadvantage for a company, since it can result in talent loss, high recruitment costs, disruptions in internal processes and low productivity levels.