Programmatic Technology Upgrades Job Advertising

​Performance-based programmatic job advertising maximizes return on investment and improves recruitment marketing and talent acquisition metrics. So why aren't more companies using it?

Terry Baker, CEO of New York City-based PandoLogic, one of the pioneers of programmatic technology, defines it as "an automated process that intelligently decides when and where your jobs will display and how much you need to bid to target the right sites, audiences and demographics to yield the right volume and quality of hires."

Most marketing departments employ programmatic ad buying; among recruiting teams, adoption is under 10 percent. But some experts see more employers jumping on board, transitioning from early adopters like recruitment agencies and staffing firms to large and some midsize employers.      

One of those experts is Madeline Laurano, founder of Aptitude Research, an analyst and advisory firm in Boston. "It's not a surprise that improving efficiency, conversion rates, time-to-fill, and recruiter productivity is what's driving TA [talent acquisition] technology decisions, accelerating the interest in programmatic," she said, speaking at the Spring HR Technology Conference and Exposition held virtually March 16-19.

"Traditional job advertising is expensive, inefficient and, at times, ineffective," she said. "It's messy and requires a huge amount of time. Recruiters must manually negotiate, purchase and monitor their advertising with different job sites, in addition to all of their other duties. And if the advertising doesn't work, companies end up spending more, without having the insights into why it isn't working."

According to Aptitude Research, on average, 40 percent of job advertising spending is wasted.

Laurano developed a maturity model based on data collected earlier this year from a survey of 426 talent acquisition and HR leaders. The research found that:

• 30 percent of employers are buying job ads completely manually. These companies rely primarily on offline search to advertise.
• 22 percent are just starting to explore programmatic job advertising or automation.
• 32 percent are using some combination of automation and traditional advertising, mostly on one or two aggregated job sites or a job search engine.
• 11 percent are moving toward a strategic programmatic model and automating advertising through job ad distribution.
• 5 percent have a fully programmatic model, automating job advertising spend and using predictive data and machine learning to optimize performance in real time.

"Although overall adoption is low, companies that leverage programmatic advertising rarely go back to a manual process," Laurano said. "Fifty-seven percent of companies that are using programmatic advertising plan to increase their investment in 2021, while 33 percent of companies are continuing the same investment this year."

Programmatic Defined

Laurano found that there is still a lot of confusion about programmatic advertising. "While marketing and sales departments have embraced it, talent acquisition leaders are not clear on the value it provides," she said.

The technology essentially automates and optimizes job ad spending. "By utilizing predictive analytics, historical data and job-seeker supplied information, your jobs are automatically distributed to the sites with the right audience where they will perform the best," she said. "Performance is monitored and optimized in real time to ensure companies are hitting their goals. Machine learning takes programmatic to the next level, by leveraging job attributes and historical data to predict performance."

Baker added that programmatic advertising should eliminate manual efforts and the programmatic platform should act as a vendor management system, eliminating the need to have separate management of vendor contracts and reports and separate processes for pricing.

"It's not a new concept, just newer to recruiting," he said. "Programmatic dramatically changed the way advertisers use and purchase display ads for consumers."

Neil Costa, the founder and CEO of HireClix, a digital recruitment marketing agency in Gloucester, Mass., said that he's seen interest in programmatic for recruitment pick up over the last five years. "It's an efficiency tool to drive more low-cost applicants. Instead of managing bids on a daily or even hourly basis, the functionality handles that. You can set goals and have the platform work toward those goals."

It doesn't apply to all clients however, and depends on needs, budgets and goals, he said. "It's best used in high-volume hiring situations or for rules-based campaigns where you want to set a certain number of applies per job. If a client is spending $1,000 per month on Indeed, they probably don't need programmatic. If they are spending tens of thousands per month across many advertising channels, then it would be more likely that we would recommend it. It shouldn't be a blanket solution."

Business Impact

Organizations that use programmatic job advertising see a dramatic improvement in overall recruitment marketing and talent acquisition metrics, according to Laurano's research.

She identified the following key points:

• Companies that use programmatic are twice as likely (60 percent versus 29 percent) to reduce time-to-fill as those that do not.
• These companies are nearly three times (56 percent versus 19 percent) as likely to improve quality-of-hire compared to companies using traditional advertising.

"The most significant benefit is the quality of source, with 60 percent of companies that use a programmatic approach seeing improvements compared to only 18 percent of companies using traditional advertising," she said.

Addressing Misperceptions

Laurano found that in addition to not understanding how programmatic advertising works, companies cited wanting to keep control, not having the budget and worrying about cost as the top hesitations for investing in it.

"But it's actually a cost-savings solution," she said. "It is designed to help companies reduce spend and ultimately save money by replacing ineffective advertising methods. When building a business case for programmatic job advertising, companies should focus on how to shift budget away from wasted spend and toward cost savings realized from a more streamlined approach."