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News

How AI Is Turbocharging Candidate Relationship Management Systems

August 8, 2024 | Dave Zielinski

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Candidate relationship management (CRM) systems have become an essential part of recruiting technology stacks, helping recruiters build and nurture pipelines of previously vetted talent, candidates who have yet to apply, and others who can expand a pool of potential applicants for hard-to-fill jobs.

Despite that value, recent research shows many recruiters are dissatisfied with their current CRM systems. A study from Aptitude Research found that only 1 in 4 companies express high satisfaction with their CRM vendors and just 15% of respondents said they would recommend their CRM to another company.

That dissatisfaction is driving recruiting leaders to consider new systems, but those buyers often face moving targets in their search. AI is transforming the technology, traditional CRM providers are expanding their capabilities, and stand-alone CRM vendors are becoming a relic of the past as more systems come packaged as part of broader talent acquisition platforms.

Dissatisfaction with a CRM can have many causes, from poor integration with an applicant tracking system (ATS) to unwieldy system features and substandard analytics tools. But the growing use of artificial intelligence and automation in next-generation CRMs—with new AI features often arriving quarterly to those platforms—makes it imperative that buyers of second- and third-generation CRMs understand the latest capabilities before choosing a new provider.

“CRM vendors are using AI to help sourcing teams both expand the pools of candidates to consider in hard-to-fill positions and narrow the pool in high-volume situations,” said Kara Yarnot, vice president of strategic consulting services for recruiting advisory firm HireClix.

Jackie Watrous, a senior director analyst with Gartner specializing in recruitment technology, said many recruiters now consider advanced AI capabilities “table stakes” in CRM systems. “Recruiters expect more in terms of AI with their CRMs today and want their vendors to keep pace with innovations,” she said.

What AI-powered features should buyers expect from a new CRM platform? Experts say the technology should, at a minimum, be able to make recommendations of “best fit” candidates from existing databases, measure with precision how engaged or interested those in talent pipelines are in certain openings, and personalize recruitment messaging to individual candidates.

For example, AI can greatly reduce recruiters’ manual work in candidate “rediscovery,” or identifying and resurfacing candidates in databases who may have been finalists for prior openings and are still interested in open jobs.

Yarnot said any talent acquisition platform today should feature AI-enabled candidate rediscovery. “Unfortunately, many ATS databases are difficult to search, and organizations thus overlook thousands of candidates who have expressed interest and have the necessary skills simply because they’re unable to find them,” she said. “A CRM that can immediately generate a list of qualified candidates before a position is posted will save an organization significant recruitment marketing budget.”

AI embedded in CRMs also can assist with one of recruiters’ most time-consuming challenges: building effective email “drip” campaigns. Experts say these campaigns typically require specialized marketing knowledge and custom content based on a specific targeted talent pool.

“AI can reduce the time to effectiveness by recommending campaign paths and drafting custom content for them,” Yarnot said. “It can also evaluate the campaigns’ results and recommend changes to increase engagement.”

Most of those tasks traditionally have been manual, Yarnot noted, which limited their impact and added to the workloads of already-overburdened recruiting teams. “The tasks were often left to individual recruiters who didn’t have the time or specialized training to ensure an effective ROI [return on investment],” she said.

AI can also make it easier for recruiters to gauge previously promising candidates’ interest levels in specific job openings. Yarnot knows of one vendor with a marketing automation product that can create candidate “engagement scores” based on how candidates interact with email campaigns. When a candidate reaches a specific engagement score threshold, a recruiter receives a notification to contact that candidate, since they appear ready to learn more about the opportunity, Yarnot said.

Value of Personalized Messaging

Recruiting buyers also should expect a CRM with AI tools that can create more personalized messaging to candidates, Watrous said. “The best systems leverage AI to customize and tweak content based on the characteristics and interests of candidates being targeted,” she said.

Generative AI (GenAI) plays a growing role here, helping recruiters avoid one-size-fits-all messaging that can be a turnoff for candidates. “GenAI helps quickly write first drafts of personalized messages with approaches like, ‘Last time we talked, we spoke about X, and I know you’re most interested in these type of roles in this part of the company,’ ” Watrous said.

AI also is now regularly used to personalize content on careers sites for candidates. “Based on someone’s history in clicking on certain job openings on a site, AI can then recommend specific openings in the future that fit those same requirements,” Watrous said.

This use of AI in CRMs represents just the beginning, experts say. “In the future, I think CRM vendors will continue to build on the foundation of their existing AI tools with advancements to analytics and more personalization for candidate engagement outreach,” said Evelyn McMullen, a research manager with Miami-based Nucleus Research.

Other Must-Have CRM Features

Recruiting industry analysts say there are a handful of other features buyers should look for when evaluating CRM providers. They include an ability to perform automated candidate segmentation to sort candidates into custom talent pools; the capacity to consolidate all relevant information on candidates in one central location; a function of seamless integration with an ATS and a careers site; and full-funnel analytics and reporting.

Yarnot said a CRM also should have event management features with robust analytics. “Both in-person and virtual recruiting events are vital parts of many organizations’ sourcing strategies, and understanding the individual event ROI is a requirement for talent leaders,” she said.

Any system also should have multiple, recruiter-friendly ways of communicating with candidates and should provide a consolidated view of all those communications, according to Chris Russell, managing director of RecTech Media, a digital recruiting consulting company in Trumbull, Conn.

“Automated, personalized communications with candidates across multiple channels is a must-have,” Russell said. “That includes email, SMS, chatbots, WhatsApp, and social media.”

Trends Impacting the CRM Market

Providers of talent acquisition platforms continue to add new capabilities to their suites, from skills management software and recruitment marketing tools to careers site personalization. Watrous said some CRM providers also are considering adding AI-enabled direct sourcing to their feature sets. That capability would expand talent pipelines beyond what a CRM builds internally.

The Aptitude Research study found that 72% of recruiters want sourcing capabilities combined with their CRM solution.

“AI-enabled sourcing has always been more of a point solution, with vendors going out to gather publicly available data, then bringing that back internally into an organization’s CRM or ATS to curate a candidate pipeline,” Watrous said. Gartner’s latest recruiting studies show many of its clients rate that capability No. 1 in terms of future importance, she noted.

Yarnot added she’s seeing more CRM providers expand their offerings into areas that were traditionally the functions of an ATS, such as interview scheduling, light job assessment questions, and employee referrals.

Dave Zielinski is principal of Skiwood Communications, a business writing and editing company in Minneapolis.

Talent Acquisition
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