Steven Rothberg (LinkedIn profile) is the president and founder of College Recruiter, a niche job board specializing in positions for students and recent graduates. The recruitment industry is changing rapidly, and Rothberg sees major disruptions across the horizon. Shifts in ad models and adoption of new tech will kill off some business models and bring others to the fore.
Rothberg will be speaking at the RecPlus Conference in Barcelona.
AIM: In your opinion, what are the major challenges facing the recruitment (classified) industry in the next three years?
Steven Rothberg (SR): “The recruitment (employment) marketing industry generates about $5 billion in revenue per year. Of that, LinkedIn and small businesses that only need to hire a person here or there generate about $3.5 billion. So the addressable market for most job boards is about $1.5 billion.
“About 23 percent of that was spent on performance-based advertising in 2018. Compare that to consumer marketing, where about 90 percent is spent on performance-based ads. At College Recruiter, we believe that recruitment will resemble consumer marketing within three years — in terms of the percentage spent on performance-based advertising. That means that the percentage of performance-based ads will increase about fourfold by 2022.
“Media that cannot or will not adapt will find that their share of the revenues of traditional, duration-based ads may increase as more and more of their competitors drop out of that market — but the size of that pie will decrease far faster. In short, if you don’t migrate from primarily or even exclusively relying upon revenues from duration-based advertising within the next few years, your business will cease to exist.”
AIM: What will most surprise conference attendees in your presentation at RecPlus?
SR: “The biggest surprise to RecPlus Barcelona attendees from the presentation that Faith [CEO Faith Rothberg, Steven’s wife] and I deliver, I believe, will be the significant business hurdles that College Recruiter needed to overcome.
“The migration from duration- to performance-based ad sales is not just a change in the product. As hard as that is, the more difficult change is in the people and process. Training people and implementing campaigns that run for 30 or some other number of days is very, very different than having the people and process in place to profitably deliver campaigns for X number of clicks where each job can have a different CPC and the same job can have different CPC’s multiple times a day.”
AIM: What unique challenges does your business face in your market?
SR: “College Recruiter believes that every student and recent graduate deserves a great career. Our customers are primarily Fortune 1,000 companies, federal government agencies, and other organizations who want to hire dozens or even hundreds of students and recent graduates of all one-, two-, and four-year colleges and universities for part-time, seasonal, internship, and entry-level jobs.
“The unusual — I hesitate to refer to anything as unique — challenge that College Recruiter faces within our niche is that our primary, direct competitors are the college career service offices — many of which still operate the same way they did in 1952. Another challenge is the older, university relations leaders within many of the largest employers. Many of them don’t include the costs to travel to dozens of campuses and wine-and-dine professors and other stakeholders in their cost-per-hire estimates. They’ll think nothing of flying two or three people halfway across the country to interview a few dozen candidates at a few schools and hire one or two of them. But they’ll balk at spending $5,000 to drive enough well-targeted candidates to their career site that they should hire at least ten.
“Fortunately, that’s changing. The old guard is either being forced out or learning from their younger, more data-driven colleagues. As a result, there’s been a remarkable transformation over the past couple of years in how many more employers are objectively looking at the outcomes of their historic sourcing practices and comparing those to their campaigns with College Recruiter and other digital, media partners.”
AIM: Where has the major recent disruption in your sector come from?
SR: “Without a doubt, the most recent disruption in our niche has come from the rapidly increasing minority of recruitment advertising dollars being spent on cost-per-click and other types of pay-for-performance instead of on traditional, duration-based products.”
AIM: How is digitalization further going to reshape your business?
SR: “College Recruiter has been fully digital for more than 28 years, so this doesn’t apply to us.”