What is the value of a brand, in real money? It may be an imperfect science, but brand value does exist – and is taken seriously by marketers, executives and financial markets alike, according to Alexander Mann Solutions
Interbrand – one of the world’s leading brand agencies – pioneered brand valuation in the late 1980s. Since then, the company has continued to explore how brand value influences business performance as it relates to customers, investors and employees. Its methodology has been certified as compliant with ISO 106681, the requirements for monetary brand valuation.
In its most recent report, Interbrand tagged Apple as the world’s most valuable brand at $119 billion. Meanwhile, the top mover on the list was Facebook, valued at just over $14 billion, which was an 86 per cent increase over the previous year.
Companies with strong, identifiable brands generally outperform their market peers. Their products are in higher demand, they’re often able to charge a premium, and they attract the best, top-performing talent.
As the global leader in talent acquisition and management, we’re most interested in those last two factors. How does brand contribute to attracting, engaging and retaining high performing employees? How can organisations create a brand that will attract high-potential candidates? How can you use your brand to tell a story and engage talent inside and outside your organisation?
“The importance of the employer brand will only increase as workforce demographics skew towards the ‘Millennial’ generation”
From a talent perspective, the impact can be significant. In 2013, LinkedIn and Lippincott conducted research looking at the intersection of talent brand and corporate brand, as measured by their own proprietary indices. In looking at hundreds of companies, research showed that companies with both a strong talent and corporate brand had a five-year cumulative growth in shareholder value of 36 per cent. For companies that fell short in both areas, shareholder value decreased by 6 per cent over the same time.
We believe there are pivotal moments in the candidate lifecycle when an individual makes a decision to engage or disengage with a brand. Get those moments right, and you create a living, breathing employer brand that candidates and employees alike will champion. Get them wrong, and you’ll find it difficult to get the kind of talent you need to succeed.
Why brand matters in talent acquisition
According to LinkedIn, 75 per cent of talent acquisition leaders acknowledge that their ‘talent brand’ (or for sake of consistency, ‘employer brand’) has a significant impact on their ability to attract and hire high-performing recruits.
In our view, the relative power of this employer brand is rooted in the experience that a candidate has whenever they interact with an organisation, whether that interaction is passive or active. At a minimum, that experience must be a positive one. But it must also be authentic and consistent – perhaps even inspiring.
From a talent acquisition perspective, it would be arrogant – and ultimately detrimental – for an organisation to assume that candidates have no preconceived notions about them. According to a 2014 survey of nearly 95,000 candidates by the Talent Board5, 52.3 per cent indicated they had some type of previous relationship with an organisation – everything from being a customer through having a family or friend who works there.
If the resulting brand perception is favourable, the talent team’s job is to uphold that perception throughout the candidate experience. If it tends towards the negative, their challenge is to overcome any initial resistance that a candidate may have to engage with the organisation at all.
“Just as we get customers advocating or criticising consumer brands, employees will do the same, recommending – or not – their place of work to others”
We believe that the importance of the employer brand will only increase as workforce demographics skew towards the ‘Millennial’ generation – those born between the early 1980s and the late 2000s. Indeed, a 2013 report by PwC found that a company’s reputation – that is, the strength of its brand in the marketplace – was the second most important criterion when millennials chose to accept their current job.
In other words, Millennials choose employers much like they choose which products or services to buy. If they feel an affinity for the organisation, they’re much more likely to pursue career opportunities there. What’s more, if it lives up to their expectations, the more likely they are to recommend it to others.
How are today’s organisations addressing the importance of the employer brand? According to the same LinkedIn survey, their actions still have plenty of room to catch up. While this is troubling, it also represents a window of opportunity for companies to get ahead of their competitors by developing and implementing a proactive strategy to measure and invest in their talent brand.
Experiencing the brand as a consumer or candidate
As consumers, we look for products and services – and brands – based on a need. If we’re in the market for a new refrigerator, we usually research what’s available, decide which one meets our specific needs, negotiate a price we are comfortable with, and become a customer. If that product performs well, we might become a loyal advocate of the brand – contributing our own glowing reviews on websites, or telling our friends and colleagues. If we’re unhappy, we may warn others to avoid a company’s products – in fact, study after study shows that we’re more likely to share a bad experience than a positive one.
The candidate experience is very similar – particularly for active candidates. First of all, they begin with a need: a job. They research companies and positions, looking for ones that match their prioritised needs. Once they’re hired, a company must deliver on the promise of its employer brand – the promise must be fulfilled.
If it is, the employee is more likely to work harder and develop a sense of loyalty to their employer. Just as we get customers advocating or criticising consumer brands, employees will do the same, recommending – or not – their place of work to others. And the cycle continues.
“Sub-par performance at any stage of the lifecycle may result in customers and candidates disengaging – while spreading the word to family and friends”
In our view, there are multiple ‘moments of truth’ along this lifecycle, and organisations must deliver authentic and positive experiences at every one.
Take, for example, the point at which the consumer ‘receives’ a product. For our refrigerator customer, this means the refrigerator was delivered on-time by a friendly delivery person. It was set up properly and worked as expected. And it came with an easy- to-understand instruction manual.
Now let’s consider the same stage in the candidate lifecycle – the employee’s induction. Did she receive a friendly welcome to the team on day one? Did she receive all the necessary equipment to perform her job effectively? Did she receive sufficient training and mentorship? Get any of these moments of truth wrong and the lifecycle is damaged. And yet, according to the Talent Board, companies continue to short-change new employees at critical times such as between the acceptance of an offer and the first day on the job. According to the Talent Board’s survey of nearly 10,000 candidates, fewer than four in ten received a phone call from the hiring manager after accepting their new position.
Instead, organisations were focused primarily on completing required paperwork.
Sub-par performance at any stage of the lifecycle may result in customers and candidates disengaging – while spreading the word to family and friends. Customers will buy from somewhere else because it costs very little to switch loyalties, while potential ones may simply pass your brand by. Likewise, talent acquisition teams may see their candidate pools dry up and become more difficult to fill as word spreads about negative candidate experiences.
Putting brand and challenge at the heart of your talent acquisition strategy
How do organisations attract outstanding candidates in the first place? How do they get them to move beyond Step 1? We believe they must do so by articulating a clear brand promise, ensuring candidates experience it first hand, and then challenging them to become a part of it themselves. This gives organisations multiple opportunities to engage, and engage further. It creates a greater degree of ‘stickiness’ between the company and the candidate and, among other things, gives them a reason to apply.
Gamification is one powerful approach to engaging candidates in a meaningful way. Marriott International Inc. was one of the pioneers of applying gamification to the recruitment arena as it sought to attract more Millennials to consider careers in hospitality – especially in emerging markets. Marriott launched its hotel-themed online game in 2011, challenging players to handle the responsibilities of a hotel kitchen manager. As they played the game, potential candidates began to familiarise themselves with the industry while earning virtual rewards – all the time developing an affinity for the Marriott brand. Marriott’s gamification strategy has since been adopted by a number of leading brands to engage candidates, including L’Oreal, Domino’s Pizza and even the United States Army.
“There are multiple ‘moments of truth’ along this lifecycle, and organisations must deliver authentic and positive experiences at every one”
It’s all part of attracting candidates who are pre- disposed to believe in an organisation’s brand ethos. They’re more motivated, more committed, and reflect that brand for customers much more effectively than employees who are simply working for a salary.
Research shows that candidates are actively engaged ‘consumers’ of employer brands. According to the Talent Board, nearly half (44 per cent) said that they need to research an organisation before proceeding with an application and spent up to two hours doing so (67.8 per cent). They’re searching for information on values (41.7 per cent), products and services offered (39.2 per cent) and for employee testimonials (33 per cent). As the economic recovery takes hold and the balance of power continues to favour candidates, we expect candidates to become even more discerning in choosing the companies they would consider working for.
Personifying the employer brand
Earlier, we pointed out that 52.3 per cent of the 90,000 candidates canvassed by the Talent Board said they had some type of previous relationship with an organisation. The remaining 47.7 per cent – those who reported having “no relationship with the company” – are a tougher nut to crack.
We would argue that organisations should approach these candidates the same way they approach consumers. A strong, aspirational brand, coupled with powerful content that engages candidates and creates enthusiasm can be a powerful way to create and grow relationships with people who don’t yet know you, while solidifying affinities with those who do.
One company that does this very effectively is Urban Outfitters – an eclectic retailer of clothes and other lifestyle items through its own brand-name stores, as well as Anthropologie, Free People, BHLDN and Terrain. The company seeks to create a brand experience for customers and candidates alike that exudes creativity, individuality and authenticity. A visit to any of the company’s stores reinforces that its employees enthusiastically live and breathe the company’s brand.
You can’t manage what you don’t measure
How do you know when your employer brand is healthy and resonating with candidates the way you want it to? We believe in adapting an approach that consumer brands have been using for years: the Net Promoter Score (NPS).
The NPS was introduced in a 2003 Harvard Business Review article and is a well-established customer loyalty metric that was developed by Bain & Company and Satmetrix. Simply put, NPS gauges the loyalty of an organisation’s customer relationships and assesses whether its customers are Promoters, Passives or Detractors.
It asks one simple question: How likely is it that you would recommend (company) to a friend or colleague. Scores can range from a low of -100, in which everyone is a detractor, to as high as +100, in which everyone is a promoter. A positive score is good, while an NPS of +50 is considered excellent.
Recipe for success
So what are the critical success factors necessary to creating and maintaining the kind of employer brand that attracts the best of the best, and encourages them to share their positive experience? We’ve boiled it down to 11 key lessons:
1. Think like a consumer marketer. Led by business-to-business companies, marketing has made a significant shift in recent years to focus on story-telling and curated content that helps enhance customers’ lives.
Employer brand managers and talent acquisition professionals must make a similar transition by taking real-life stories about successful, engaged employees and sharing them with candidates through a variety of channels. This includes social media, which can be used as a platform to not only tell those compelling stories, but enables them to be shared with a much wider audience.
They must also, as marketers do, constantly measure the impact of their messages and their channels – and course correct as necessary.
2. Reinvent the way you interact with candidates. Look for ways to improve the candidate experience throughout the talent acquisition process. Create convenient, personalised experiences every step of the way – not just when you’re trying to build a talent pool for a particular position.
Reach out to candidates wherever they ‘live’ – including online and offline. Leverage social and mobile technologies. Add value to their lives, whether they’re active or passive candidates.
3. Base your process on the candidate experience. Recruitment processes are often quite dull and linear, so making them engaging can be a challenge. Start first by mapping out the ideal candidate experience and alter your process to facilitate the experience. Look at your competitor’s candidate experience and learn what you should avoid or co-opt.
4. Get insight into your audience. Never assume you know your audience. Consumer marketers go into a great amount of detail to understand their consumers by creating fictional personas – a hypothetical group of customers that identify patterns of behaviour, goals, skills, attitudes.
In recruitment, we have vast amounts of data at our fingertips (about candidates, performance metrics and the markets within which we recruit) yet we don’t use it effectively to build candidates’ profiles and ideal personas.
5. Implement consistently across all touchpoints. Candidates are not one-size-fits-all. Some prefer to be contacted by phone, while others prefer email. Ensure that all of your communications are impeccable regardless of how they’re delivered.
It’s also important to deliver a consistent experience at every stage of the candidate experience. Candidates should feel just as special on the day they begin their new job as they did on the day they had their first interview with the hiring manager, or on the day they received their job offer. Be consistent and your employer brand will be seen as authentic, not artificial.
6. Measure everything. Improvements can’t be made if there are no metrics in place to compare progress. Consider measuring candidate experiences using a measure like the Net Promoter Score. Ask qualitative questions of candidates once they have completed the process: What did they enjoy most? What was most frustrating? Why did they apply in the first place? Track your performance over time and constantly look for opportunities to improve.
7. Communicate throughout the process. If you do a phone screen, give the candidate some honest feedback. If a candidate comes to your careers site, acknowledge the visit with an email explaining your hiring process, or a video that espouses your company’s values. Technology is now available to make these steps easy. There’s no reason not to do it.
8. Think like a candidate. Another timeless reminder: treat others as you’d like to be treated. This Golden Rule is especially important if you want to ensure every candidate has a positive experience.
9. Be a person first, and an HR manager or recruiter second. People want to deal with people. Make your hiring process as personal as you can. You’re not a robot and neither are your candidates – yet!
10. Set expectations. This is part of the communications process but it deserves special attention. Don’t leave people wondering where they are in the process, or if they’ve been disqualified. Let them know what your process is, when they can expect to hear back, and how quickly you’re planning to make a decision.
11. The candidate experience is a two way street. It’s vital to remember that today’s candidates are assessing you as a potential employer as much as you’re assessing them as a potential employee. As much as they present themselves in a way that makes them attractive to you, it’s important that you put your best foot forward as well.
Make sure your candidate experience is a positive one. Emphasise your brand’s values and what makes you a great place to work, and ensure that the experience is consistently positive. It’s easier to maintain a good reputation than it is to rebuild one.
We believe employer brands come to life throughout the talent acquisition process. They come to life through careers websites and social media campaigns. They come to life in your advertising. And critically, they come to life through the conversations that your talent acquisition team has with every single candidate. Employer brands live or die at every stage of the candidate lifecycle – but with the right strategies in place, they can be a powerful path to building a top-performing workforce.
By Alexander Mann Solutions’ Adam Shay with Liz Weeks, Matthew Bristow and Chance Wilson. Image source: iStock