In response to my previous post about the slew of job portals hitting the on-line recruitment space, I got a few mails which refuted the idea of stand alone job portals and were more inclined towards community based job portals.
To begin with ,for any concept to be successful it has to, either address a pain area or should be so disruptive that it changes how businesses are done. A concept which aims to solve a pain area or just a gap may run into scalability issues. The only runaway successes have been concepts which turned things on their head. However innovation is the key here. The starting points for an entrepreneur can be anything. He may start by addressing a gap and then keep improving and innovating with time.
Coming to whats happening in the online recruitment space. There are loads of people trying to get into this space and everyone is taking pot shots at the Big daddies like Naukri and monster. In my previous post I had mentioned how people are battling the talent crunch by trying to reach out to the passive job seekers.
That essentially requires the recruiters go where the potential hire is available or create “honey traps” for the candidate. “Honey Trap” is an interesting thing,I have borrowed it from the espionage lingo , read about it here 
. When I say “Honey trap” it can be a compelling content or rewards or networking features. And this is what all new portals are trying to do .
I will not get into details of the features of these portals, but rather share my views on the fundamentals driving these portals. They have the same revenue model , referral based hiring. It seems to be a good and simple model. Get the job listings , get people on to the portal and pay them for referrals. Bingo, you have a money machine up and cranked. But will the money flow ? I have my doubts about it.
The biggest drawback with any referral based system is lack of accountability. As a portal you can bring people to your site through variety of means, but the quality and the quantity of referrals cannot be moderated. As an hiring manager I will be working according to a time based plan. I expect a certain number of suitable resumes in pipleline to meet my hiring targets.A referral portal can control the quality of resumes but getting the right volume at the right time is the key. To crack this problem they need to have a mammoth active user base and this is not an easy task. And also hope that they keep making more and more referrals.
During my discussion with hiring managers, one question which always used to crop up was “How do you ensure that candidates will join? “. This is a genuine problem for which the referral model has no answer. Collecting multiple job offers is quite common these days and so are no “No shows”. A referral portal which can come up with a solution for this can surely beat the pack, till then they will see their bottomlines suffering because of this.
Recruitment business usually has long payment cycles, this may effect the referrer community interest.Only portals which have compelling content, strong community orientation can manage this. Portals which predominantly focus only on building network and referrals will suffer because of this.We might see the interest of the referrer community wane once they realise that it may take sometime before they start seeing the money rolling in. Another of my concerns is the amount of spamming the referral portals will allow. With people sending invite to anyone and everyone , be ready to see loads of job invites, relevant and quite often irrelevant, in your mail box.
It took quite some time for Jobster to gain acceptance in US and the Indian market will take sometime to mature. For the sites which came early, the growth has not been along the expected lines. As I said in the beginning people just trying to fill in the gaps will not succeed. But if they keep improving and innovating we might see some serious competition for Naukri and monster.Don’t ask me what kind of innovations , If I had an answer I would have a raked in a moolah from it.
May 19, 2008 at 8:37 pm |
Here in the US, referral sites have come and gone and have come again. Back in the internet heyday, (1998-1999), there was CareerRewards.com, refer.com and a host others trying to make money by having people refer their friends and colleagues to jobs. The second wave of these sites includes H3.com, Zubka.com and to a lesser extent, Jobster.com
The main problem with these sites is the inability to gain critical mass.
I think you have to look at what prompts someone to refer someone else to a job as well as what inhibits someone to refer someone else. Money could be a motivating factor, helping a friend could be another motivating factor. Factors that inhibit a referral include: 1) people really don’t know who is looking for a new job. 2) Fear of how the person you refer will react. These sites as they are set up might make enough to survive, but in now way are they Monster killers.