Acronyms and jargon sound impressive, but they’re even more effective when we understand what the heck they stand for.
Understanding terms common in the recruitment world – in addition to those specific to PPC and online advertising – will make it easier to be successful in the job board space.
What terms can you expect to hear or read when dealing in recruitment marketing?
Cost Per Applicant (CPA)
This term is one of the most important phrases in the job board industry. It gets to the bottom line: how much money did it cost for your staffing agency to acquire an application? Within the industry, this will vary greatly by industry (manufacturing vs. healthcare/IT) and geography.
It’s important to know your cost per application, as this number helps inform better performance-based decisions. Let’s say it costs $15 for your recruiters to acquire an accounting resume. With that data, your team can now evaluate its recruitment spend and try to lower the CPA.
Would moving job board spend to a different board bring a number lower than $15/application? Would it increase your spend? You’ll never know without some testing. These are the types of decisions that can improve your ROI.
Cost Per Hire (CPH)
This number is harder to quantify and determine because it requires tracking throughout the entire process. Even taking CPA data into consideration, can your team determine how much it actually costs to hire a candidate?
This number varies, considering the variety of information that goes into its calculation. We have to examine both internal costs and external costs (which can include anything from job board advertising to background checks and recruitment marketing expenses).
When calculating internal costs, there are several factors at play. How much gets allocated to specific recruiters? How much time are other employees spending on the hiring process? The hiring manager is meeting with HR and spending time in interviews – are other employees also spending time on interviews? (We also have to think about the lost revenue because of the open position.)
I think we’re good here.
This is the percentage of candidates who apply for the job – it’s similar (but different) to click-thru rate, explained in my article on PPC and online advertising terms.
There are two different ways to compute this statistic:
- Common Method: In this method, we look at the number of impressions on the job and the number of resulting applications. Let’s say a job had 500 impressions and 50 applications – that leads to a 10% conversion percentage.
- Alternate Method: In this method, we look at the number of clicks on the job posting and the number of resulting applications to get our percentage. Let’s say a job had 100 clicks and 50 applications – the conversion percentage would be 50%.
An industry benchmark of 10% is suggested (when using the common method), but there are a variety of factors that could affect what’s considered a “successful” job posting. Recruiting nurse practitioners, for example, will be much different than recruiting machine operators.
Knowing the benchmarks for your staffing agency will help your team make better recruitment marketing decisions. It’s easier to evaluate your recruitment and job board spend with these metrics in place. If the cost per application is rising, your tactics and strategies might need adjustment – or you might be recruiting in a competitive market with fewer and fewer candidates.
Candidate recruitment is not getting any easier; it’s important to have your benchmarks in place now to know when (and how!) to adjust.
Industry jargon can be overwhelming but understanding leads to better results. Ready to put what you’ve learned in action?
At Haley Marketing, we’re ready to help you get more ROI of your recruitment spend. Contact our team of recruitment marketing specialists today.