Construction site crane building a blue 3D BRAND textWe live in an era of mass customization. Consumers no longer want template based, uniformed products, they want products and services that are tailored to suit their individual preferences and lifestyle needs.

This more discerning attitude has also filtered through to the job seeking process; the more lifestyle conscious candidate is no longer satisfied with a one-size-fits-all approach. They want to work for an employer brands that suit their needs.

As a result, many employers are responding by developing employer brands to fit the more discerning tastes of the candidate market, but the question is does it make any difference really? How much does a candidate’s perception of a brand really affect his/her decision to apply for a job with a company? Is it really worth a company’s effort to invest resources in employer branding? Is your boss or CEO right to bestow your employer brand marketing team with a big, juicy marketing budget?

Well, I think there are probably two ways to look it. First, you need to show some evidence that employer branding works at all – and this should be enough to justify an initial investment. But you’ll then need to show ongoing ROI from your employer branding program to secure righteous onward investment.

In terms of whether branding works in general, I found a great whitepaper from LinkedIn called Why Your Employer Brand Matters. They discovered that a strong overall company brand does make talent more likely to consider your business, but it is not an overwhelming motivator.

What they did find however was a strong employer brand (this means candidates have a positive impression of you as a place to work) is twice as powerful a motivator for candidates to apply to a business than a positive overall company brand. This study indicates that there is a clear case for inward investment into your employer branding initiatives in addition to the company branding initiative.

What they also found was that employer brand was particularly important for attracting more junior employees (staff and managers, not Directors) and candidates from younger demographics (under 40) and those from outside the US. So, clearly if attracting talent from these areas is important to your business, then you have a much stronger case for investment in employer branding as you are likely to generate a bigger ROI.

The evidence for employer branding investment doesn’t stop there; the employer branding institute also found that 85 percent of employees are attracted to companies that have a reputation for providing career opportunities and 50 percent of employees think its important that other people want to work for their employer.

And finally, Employer Brand International’s (EBI) 2012/2013 Global Research Study has shown that 39 percent of companies plan to increase their investment in employer branding initiatives in 2013 so the competition could leave your business behind if you don’t invest.

It seems that there is strong evidence that employer branding works, but I think it should be tempered by the findings of the CareerBuilder Applicant Experience survey, which found that the main reason that people apply for jobs is location (44 percent cited this), whereas reputation/brand was only the third most influential motivator (cited by 25 percent of survey respondents).

So, while employer branding clearly works in motivating people to join your company, its not the main determinant of job appeal (location is). So moving to a more desirable location may have a more positive affect on talent attraction than improving your brand. But, since it’s not always possible to change location or change industry (the second most appealing candidate factor), reputation and brand is, perhaps, the most change ready part of your candidate proposition.

As you can see, there are some strong statistics that show the link between a positive employer brand and talent attraction, which you can use to help secure your initial inward tranche of investment into your sparkling employer branding initiative. But to keep the money coming and ensure inward investment in coming years, you’ll need to show the ROI of employer branding within your business. You’ll need to show that employer branding matters in your business, just like you do with any other business initiative, and you can do this by measuring the ROI using several key metrics.

According to EBI’s study, the most commonly used branding ROI metric was retention rate used by 38 percent of employers, next was employee engagement (33%), then quality of hire (29%), cost of hire (27%), and number of applicants (26%).

So, while the external stats from LinkedIn can show that employer branding has been shown to work and that it does attract more talent, this is only half of the equation. In order to secure ongoing inward investment in your employer branding initiatives, you’ll need to show that employer branding really works and actually brings in and retains better quality talent.

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