Everything in the employment marketplace revolves around value. It’s why a company or organization would hire somebody as a new employee. It’s also why that same company or organization would hire a search consultant. This why it’s important for you to have a strong recruitment value proposition.
What is a recruitment value proposition?
What is a recruitment value proposition? Essentially, it’s the value that you as a recruiting agency provide to your clients and candidates. (You certainly can’t forget the candidates, can you?) However, it’s not just one specific thing. Your recruitment value proposition includes all the forms of value that you provide. The more forms of value that you provide, the stronger your recruitment value proposition.
It’s not enough, though, just to have a recruitment value proposition. You have to be able to articulate and communicate the value that you provide to both clients and prospective clients. After all, if you don’t tell them that you provide value, how else are they supposed to know about it? And the rule of thumb is simple: people are willing to pay for something if they perceive that something to be more valuable than the amount they’re paying for it.
Translation for the recruiting profession: a company or organization is willing to pay a fee to a search consultant if its decision makers believe it is receive more perceived value than the amount of the recruiting fee.
With that as the baseline, we can infer the following:
- A prospective client will not want to secure your recruiting agency’s services unless the perceived value of your agency’s services is beyond a certain level.
- A current client will not want to pay high fees for your recruiting agency’s services unless the perceived value of your agency’s services is worth more than the perceived value of those fees.
Recruiting industry trainer Jon Bartos of Revenue Performance Management is a premier writer, speaker, and consultant on all aspects of personal performance, human capital, and the analytics behind them. In this blog post, Bartos presents four steps for creating a winning recruitment value proposition. Those four steps are as follows:
- Know the target market or niche that you’re going after.
- Define the specific needs you can meet or problems you can solve.
- Explain the benefits your clients receive from your recruiting solutions.
- Know why you are better than primary competitor.
So what is the bottom line when it comes to your agency’s recruitment value proposition? It’s rather simple, when you break it down.
After identifying the value that your agency offers, especially the value that your competitors do NOT offer, you must articulate and communicate that value to clients and prospective clients. Even more than that, you must do so in a way that convinces them that the perceived value that your agency provides is much more than the value of the fee that they will pay for your agency’s services.
This is how you justify large fees, as well as retained fees: with value. However, you can’t just assume that clients and potential clients will just “get it.” You must communicate your message loudly and clearly, in as many ways as you can. If you want 30% fees instead of 20% fees, then effectively communicate your agency’s recruitment value proposition. If you want more retained work, the effectively communicate your agency’s recruitment value proposition. If you don’t do this, then it’s more likely that you will be viewed as “just another recruiting agency.” And employers are not in the habit of giving 30% fees or retained work to agencies they view in such a manner.
How to make your value proposition work for you
However, once you’ve established your winning value proposition, how do you make it work for you? A follow-up question might be how do you make it work for you on the phone? After all, communicating your agency’s value during a recruitment meeting or intake meeting is one thing. However, it’s quite another to do so over the telephone, when you can’t see the expression on the other person’s face.
Increasing the degree of difficulty is doing so during a recruitment marketing phone call. In other words, a cold call with a prospective new client. In such a scenario, not only are you looking to score a job order, but you’re also looking to score one that has a high fee percentage attached to it. (Or perhaps, even a retained search.) So once again, how do you make your recruitment proposition work for you?
According to Bartos, the answer is to earn their respect. A typical recruiter in a phone conversation with a hiring authority starts talking about fees before even explaining why they called. Wrong approach.
For too long, our industry has accepted the premise that no one should pick up the phone for less than a 30 percent fee. This is the most ridiculous trend in recruiting today. Good hiring managers and seasoned human resources professionals eat these over-eager recruiters for lunch.
You have to work for their business. Show them why you are worth more. Help them understand what you do and how you do it better than everyone else.
To truly get the most from your value proposition, you must have a real understanding of your clients and your markets. Be an active listener and interviewer. Conduct an in-depth needs analysis of the client and the position. Ask great questions and get detailed answers. Ask why often! Go three questions deep on important subjects.
Give yourself time to prepare a search strategy. After your initial contact, always set up an appointment later that day or the following day. Why a second call?
Because you need to go back and do your homework. Re-examine your information, come up with new questions, and discuss the specific search requirements with your team.
Can you fill this search? Do you have the resources and the time? You want the client to know that solid research is being done. This establishes you as not just another recruiter arguing about fees without any justification as to why.
If the hiring manager requests a service fee quoted off the cuff, say this: “I would love to be able to do that, but I can’t. I need to consult with my team. We will do some research on our side to evaluate the market and the difficulty level of the search. We take into consideration our pipeline of critical jobs to fill and the time commitment filling your position will require. We can then determine how to allocate our resources to give you the best results within your time frame. Only then can I quote you an accurate service fee based on a fair ROI (return on investment). Can we talk at 9 a.m, tomorrow morning, and I will have everything clarified?”
Saying this accomplishes five main things:
- It gives you a chance to turn this job into a search assignment by further qualifying and positioning yourself correctly as a professional.
- It allows you time to do your due diligence.
- It puts you in control, letting you determine the viability of this particular search at this time.
- It lets you decide whether this search is one you want to undertake based on the specific requirements and your available resources.
- Most importantly, it gives the perception that you are best recruiter in this business.
The call back is like the all-important second date. Both of you will be evaluating whether the relationship should continue. Review the job specifications in detail with the client to make sure nothing has changed. Let them know you and your team have conducted considerable research. Then make your proposal.
Explain with confidence the specific steps you will take to fill this search in the agreed amount of time. Talk about your value proposition again. Once you’ve convinced the client of your value and secured their agreement on your search plan, then and only then, you discuss the fee.
Your value proposition is not just for your clients.
Once you take the time to develop and articulate your key differentiations, it can change your career. This isn’t just a generic sales pitch or a script you are reciting. It is your unique story, the successful recruiter or recruiting organization’s touchstone. Believe in your professional worth. Never let a Vice President of Human Resources or a hiring manager bully you into lower fees.
You have shown them the value you bring to the table. Any service fee is based on a favorable return on their investment. If you have someone persistently badgering you to lower your fee, don’t waver.
Say, “We’ve explained our search strategy. Which step shall we skip?” I am so confident in my own value proposition that I will not be swayed, even by a talented negotiator, and neither should you. Remember, it is a fair price based on the service you will deliver.
Recruiting is not for the meek. You have to be sure of yourself and your value. This isn’t empty self-esteem “mumbo jumbo.”
It is confidence built upon hard-earned professional equity. Develop a winning value proposition today to earn higher fees and more retained work tomorrow.
Training for dealing with clients
Another way to score higher recruiting fees is to engage in continuous training and education. The more knowledge you possess, the more perceived value that you can offer to employers, which it turns translates into higher fees.
With that mind, it’s important to note that Top Echelon offers a free monthly webinar as part of its Recruiter Coaching Series. After the webinars are over, we post the recorded version of the webinars in our Recruiter Training Library. These webinars touch upon a variety of recruiter-related topics. These topics deal with both candidates and clients. As always, our goal with these webinars (and corresponding videos) is to help recruiters make more placements.
Jon Bartos has multiple videos in the Top Echelon Recruiter Training Library. In addition, many of these videos deal with client-related topics. Some of these videos are listed below. Click on the title of each video for access:
- “Moving Your Clients Up the Value Chain”
- “Advanced Branding Strategies for Recruiters”
- “From Contingent to Mutually Committed Client Relationships”
In addition to training and webinars, Top Echelon offers other recruitment solutions. These solutions include the following:
For more information about Top Echelon and the products and services that it offers, visit the Top Echelon website by clicking here.