Is social networking about to do to Monster what Monster did to newspapers?
For several years Monster.com, the biggest job recruitment site has listed social networks among the risks in its regulatory filings.
But as recently during its July earnings call—the last time the company was publicly asked—CEO Sal Iannuzzi said: “With regard to the social networks or the professional social networks, we simply have not seen any type of significant impact on our business.”
Yet there are signs that may be changing, with the likes of LinkedIn, Facebook and Twitter making inroads—clearly something investors may want watch when Monster announces earnings Thursday.
- Accenture tells my associate, Karina Frayter: “We started using social networking to find talent in 2008 and we expect to make about 40 percent of our new hires in the next few years through social media.” Job boards “are still a part of the mix, although much less than a few years ago.” Adds Susan Cantrell, a research fellow at Accenture, “The shift in recruiting toward social networks is only getting stronger, and represents the next big development in matching job seekers with jobs.”
- Swiss Staffing giant Adecco said at an investor conference last year that it was reducing its reliance on job board and redirecting some of its resources toward the likes of Linkedin, where it says it finds “better-qualified candidates.” (Adecco has even developed an Apple iPhone app.)
- Terramark, the tech company, told Karina: “We utilize both Facebook and LinkedIn regularly. They are both an important part of our recruitment strategy. We use both primarily for networking and finding the passive candidate that is not actively looking for a new job.” What about Monster? “We made a choice to use CareerBuilder (owned by Gannett) over Monster because the talent pools tended to be the same and CareerBuilder’s usability and reporting better suited our needs. We also use Dice and other niche focused sites as needed.”
- Microsoft to Karina: Use social media sites, traditional job boards and social media, including Microsoft’s internal JobsBlog, which links to the company’s social media presence on LinkedIn, Facebook and YouTube. According to a spokesman, “Jobs boards are effective in reaching active candidates, while social media reaches candidates where they socialize and gather information, regardless of whether they’re seeking a job.”
- A survey by Corporate Executive Board, a business consulting firm, shows that this year 24 percent of companies plan to rely less on third party recruiting websites and job boards; 80 percent say they plan to increase their use of job-board alternatives, such as social networking.
Even CareerBuilder, Monster’s biggest online jobs board rival, acknowledges their role.
According to a spokeswoman: “We believe social media is complimentary to what we do and we have several offerings that leverage social media for our clients’ recruitment programs… If you need three IT people in San Francisco, LinkedIn may be a good option for you. For the bellwether positions like sales and marketing—where companies are hiring in larger volumes—players like LinkedIn can’t offer the applicant flow needed.”
For now, at least.
Monster clearly has fans on Wall Street, including Mark Mahaney of Citigroup, who believes the firm’s proprietary survey of human resources teams at large companies suggests that Monster has been successfully improving its products and services. “Monster may actually do pretty well,” he says.
With hiring on the upswing, this could be a pivotal year. And Goldman Sachs analyst Ingrid Chung, one of three analysts to boldly rank Monster as a “sell,” doesn’t think it will be pivotal in Monster’s favor.
She cites several reasons, and social media is among them. “We are going to see more hiring than we have in the last two years, and the shift from generalist job boards to social media is going to be significant,” she predicts.
My take: This isn’t about whether Monster meets or beats earnings, but about a trend that appears to be gaining steam. Just how it impacts Monster over time remains to be seen, but ignoring the risk would appear to be foolhardy.
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