Back in the days when job boards were feared to be the end of staffing, just imagine also breaking the news that in a not-so-distant future, robots would be deciding where to post job ads. While robots are more likely to look like a bunch of algorithms than C-3PO nowadays, programmatic job advertising is one of the many AI-enabled automated processes that are bound to leave a mark on how jobs are being advertised.
Traditional job advertising is a manual, messy and time-consuming process. While the cost of advertising may be understood, there is little understanding of the cost of the inefficiencies in the process, the wasted spend and the true return on investment. For those with the right aptitude and right resources, a programmatic approach can provide better conversion rates, better applicant quality, reduced time-to-fill and lower cost.
Defining Programmatic Job Advertising
Programmatic job advertising is a method to distribute job ads using artificial intelligence and machine learning to determine where employers will have the most success in displaying their vacancies in line with their available budgets. Adopters are able to manage their ad campaigns, taking advantage of historic and real-time analytics, including predictive analytics, to fine-tune their campaigns and optimize performance.
Within SIA’s Talent Acquisition Technology Ecosystem, programmatic job advertising is part of the Candidate Discovery sector and a category within the Online Job Advertising sub-segment.
The programmatic platform analyzes the different skills, responsibilities and other content in a job description and works out which job boards and other websites will likely drive the most conversions. Bringing artificial intelligence to bear in determining the best ad location can lead to a better outcome not only in terms of candidate applications but also candidate quality. Once a campaign is underway, human decision-making can be eliminated and the process fully automated.
Market Landscape and Trends
Many programmatic job advertisers are independent software firms, though a number of job boards, ATS vendors and recruitment media agencies have built their own products or added them to their portfolios through acquisition.
The general consensus among market commentators is that the three largest global firms are Appcast, Joveo and PandoLogic, all headquartered in the US. A number of important European vendors have also been identified, primarily in the UK, Germany, the Netherlands and Switzerland.
Indeed’s acquisition of UK-based ClickIQ in July 2019 has the potential to disrupt the current market given the ambition and financial resources of Indeed’s parent company, Japanese staffing giant Recruit.
An important target market for programmatic job advertisers is large and medium enterprise clients. Programmatic job advertising is only really practical for high-volume hiring and more cost effective when agreed-upon as part of an organization’s ongoing strategic hiring program.
As sophisticated talent acquisition specialists, it is not surprising that staffing firms are an important target group for programmatic job advertisers. A number of independent providers are particularly proactive in targeting the staffing community.
Some programmatic job advertisers enjoy an additional revenue stream through the licensing of their software, providing a white-label platform for third parties. Because of this, it is often unclear whether some solution providers are using software they have created themselves or software developed by a third party.
Programmatic vs. Job Distribution
Though the market developed independently, programmatic job advertisers are close cousins, and in many respects a more advanced version, of the services provided by job distributors. The key difference between the two models is that with job distributors, the client makes a choice as to where their ad is displayed. With programmatic job advertising, the user can be completely ambivalent about the location of the job ad and put their trust in machine learning to determine the optimal places to post the job.
A number of job distributors have developed their own — or partnered with third parties to provide — programmatic job advertising, thereby offering their customers a choice.
Pricing Models
An important aspect of programmatic job advertising is that the pricing model is performance based.
The most common pricing model is pay-per-click, but pay-per-applicant, pay-per-shortlist and even pay-per-hire options can be deployed. Obviously, the cost increases from pay-per-click through to pay-per-hire. The pay-per-performance aspect of programmatic job advertising would be a strong attraction for staffing firms given their clients only pay them based on placement.
Costs will be agreed-upon for your campaign based on the number of vacancies you want to fill and the number of applicants you would like to receive for each position. Payment will likely be on a monthly basis (paid in advance), though some vendors will expect a minimum commitment such as an annual license.
Most vendors offer a basic entry-level service with options for enhanced premium and enterprise-level services. Services will vary per vendor, so the features in the above chart are purely indicative.
Outlook
All indications are that programmatic job advertising will enjoy strong growth in the short- and mid-term. Coming out of a global pandemic and economic crisis, one might assume that employers would be benefiting from a labor surplus; however, many have been surprised by how difficult it is to source good candidates so early in the recovery. Such skills shortages should provide a strong tailwind for programmatic demand. One of the main barriers to growth — the perceived complexity of the service — will likely dissipate as more employers get comfortable with the concept of programmatic procurement.
Programmatic job advertising works best in a fragmented job board market and where the availability of choices for employers to post jobs are many and varied. This likely explains the prevalence of programmatic job advertisers in North America and northern Europe and the more limited extent of programmatic job advertising in countries dominated by one or a few job boards (including a number of Asian and Australasian markets).
For a deeper look at programmatic job advertising, check out SIA’s “Introducing Programmatic Job Advertising” report, which includes an overview of the market with a look at trends, market players and pricing models, as well as directories of vendors.
