How to Measure the ROI of Your Recruitment Marketing
The advertising campaign is a key component of the overall recruitment plan and one key element of being a great marketer is being able to measure your success. All of your internet activities connected with your company branding, job postings, and adverts can be tracked and analyzed, and these data will give you a good idea of what is working for your audience and what is not working.
If you are working in talent acquisition you probably have a budget for branding activities, recruitment tools, ATS’s (Applicant tracking system) and job boards for the whole year. But when considering whether or not to invest in the same resource the following year, you are probably asking questions like: “What will the return be?” or “Did I secure enough candidates for this investment?”
You don’t want to spend money on anything that is not working for you or that will not provide any benefit. But how do you discover whether the tool or resource is working or not? It is easy with tracking and ROI (return on investment).
“Doing business without advertising is like winking at a girl in the dark. You know what you are doing, but nobody else does”
– Steuart Henderson Britt
What is return on investment?
Return on investment (ROI) measures the gain or loss generated against the amount of money invested and it indicates whether or not a company is using its resources in an efficient manner. ROI in recruitment is all about value.
Companies often spend thousands of dollars on resources that give them a very small return on their investment or sometimes none at all. They do it because it brought them value five years ago and so the resource is considered to be a good one, based only on previous experience. Measuring ROI in recruitment is the responsibility of the talent acquisition team, because it helps them not only to justify advertising decisions, but also to give them an overview of the activities and resources that are working. Recruitment campaigns are also investments; using ROI helps you to justify marketing investments that you are planning and also helps to evaluate whether your activities are effective.
The best ROI data I have ever captured from any tool on the internet that helps with recruiting and branding activities, came from Hootsuite; this tool is quite brilliant, it can also be used for sourcing candidates, if you know how to use it.
Some of the common metrics for measuring recruitment advertising are CPH (cost per hire) and CPA (cost per applicant). They are very easy to measure and calculate, here are two examples.
CPH (Cost per hire)
Total external media cost / number of hires
Example: $10,000 USD / 10 hires = $1000 USD CPH
CPA (Cost per applicant)
Total external media cost / number of applicants
Example: $10,000 USD / 1000 applicants = $10.00 USD CPA
But this will only give you an idea about costs that you are spending on advertising.
Some other simple metrics that you can use to assess recruiting effectiveness are: Source of hire, quality of hire, time taken to fill position, manager satisfaction, candidate satisfaction, impact of a bad hire etc.
“Social media success formula: Content + Engagement + Conversion. Rinse. Repeat”
– Mari Smith
What can or should be tracked?
Make candidate source tracking a real priority within your organization, it will make a huge difference. If you are still using an old ATS (Applicant tracking system), start thinking about a new one, or try to find out if your current ATS already offers this functionality. Many of the new ATS’s support automated candidate source tracking, so you can stop asking candidates “Where did you hear about us?” or “Where did you see our advertisement?” because you will already know the answer!
Do you know how many visitors saw your advert, how many of them clicked on the apply button, how many of them became stuck in the registration process, how many applications you have received from your career portal and from sources like LinkedIn, and how many hires the advertisement that you launched two months ago generated?
If you know the answer to all these questions you are probably doing a great job! If you don’t know the answers, then you should start tracking your activity, because without this information you will spend money from your budget on things that may be working or not working but you will not know either way.
Careers website – It’s the first page where your candidates are going to find information about the company and it’s also where they apply. So you need to find the source from where they are coming to this page. If you are starting to build a new careers page or you are optimizing the current one, don’t be afraid to use heatmaps, they will help you to understand what is and isn’t working in terms of the text and images on that page. This can help you to monitor user behavior; based on that you can optimize your careers page and provide a better candidate experience during the application process.
Advertisement – Every single picture, URL and post can and should be tracked if it’s part of your recruiting/branding strategy. Using this data, you can be more effective by reaching your target audience. If you know that sharing interesting articles with your LinkedIn audience after 9 am is going to bring ten times more visitors per reader than after 3pm, you are going stop sharing articles after 3pm, right? That is why it’s important to start tracking, collecting and analyzing data.
How to Track?
If you want to measure the traffic of a careers portal or the success of your branding activities/adverts, the best free tool that is available on the Internet is Google Analytics combined with UTM codes. (Also known as UTM parameters.)
UTM example Link
For example, if you are going to post a picture with a URL and you would like to track the success of your content on the web you can use the link above.
LinkedIn – Picture one LinkedIn
Example UTM for Banner on career page
Article that you are sharing on Twitter
This link www.solarwinds.jobs has this UTM parameters:
utm_source= name of a site (LinkedIn)
utm_medium= social website
utm_campaign= this article
You can make any combination of these parameters and you can track anything that you post online. You will find lots of information about UTM codes and how to use them on internet, but here is a quick overview of the five UTM parameters that you can use.
Campaign Name (utm_campaign)
Code: utm_campaign= for example: position0174
The name that allows you to recognize your campaigns
Campaign Medium (utm_medium)
Code: utm_medium= for example: socialmedia
The medium on which your ad is shared
Campaign Source (utm_source)
Code: utm_source= for example: LinkedIn
The source that sends traffic to your career page
Campaign Term (utm_term)
Code: utm_term= for example: button
The link, button or ad that is involved in tracking
Campaign Content (utm_content)
Code: utm_content= for example: magazinpage7
The content that you are sharing
Adding these parameters after the question mark doesn’t affect anything on your page or ruin your links, it helps you to track your marketing activities and your visitors better.
Why it’s good to use UTM codes?
You can track social channels or marketing activities to discover the ones that are bringing you the best value. You can even track the same piece of content across multiple channels, so that you can easily see what happens if you post a picture on LinkedIn and the same one on Twitter, Facebook, Ello etc. With UTM parameters you can easily see the channel that worked best for this specific marketing activity. You can see where most people click on your links in your article, post or in your newsletter you can easily see what catches the eyes of the readers.
Google Analytics will help you to identify the number of visitors to your page and their source. Probably the most important information in Google Analytics Dashboard is Conversions. When you are setting up goals, Google Analytics will show you for example the number your visitors who apply through your website or perform some specific action. For recruiters these actions are most commonly set up to record the number of candidate applications.
So if your company has spent $5,000 USD on a job board that provides 1000 visitors yearly, of which fifty users have applied, and you have hired only one of them, Google Analytics will easily show that you spent $5,000 USD on one hire. But for example you may also see that every picture you posted on Twitter (for free) brings you two candidates and one hire every month, which means you can save the $5,000 USD that you are spending on the job board and use it to expand your other activities, like Promoted Tweets etc.
“Creativity without strategy is called art, creative with strategy is called advertising”
– Prof. Jef L. Richards
When you start a new recruitment advertising strategy, try to measure everything possible; don’t be afraid to make adjustments during the process if some advert or source is not bringing you the value that you are expecting.