Is it too early to forecast the demise of the vertical job search engines? Maybe. Maybe not. Here are some thoughts to consider:
- Indeed – If any vertical will survive on its own, these guys are it. They know the job board business better than their peers and have kept things focused and lean-and-mean from Day One. That said, the recent choice by investor New York Times to ally with Monster Worldwide doesn’t bode well for the current state of revenue generation for Indeed. Their PPC model, a la Google AdWords, is well done, but by the time enough job boards become advertisers (assuming a profitable number do become advertisers), the faucet of content may dry-up.
- Simply Hired – Born to be acquired and partying like its 1999. The gang at SH is very talented but their trial-and-error is reminiscent of the early days: resume blasting, untargeted banner ads (a job search for “marketing” in “Cleveland” gives me general ads for Dice, a healthcare job board and Oracle) and giveaway promos for a free HP Jordana, er, I mean iPhone. The Job-a-matic product is nice, but I have doubts the blogging masses will generate enough cash to make it worthwhile. Hell, I write for the Internet recruiting space and only have 2 job postings on my own board … and postings are only $5. Geesh!
- Jobster – The evolution of these cats reads like a horror story out of business school. Referral site then vertical job search engine then social network then layoffs then free-for-all and spending God-only-knows to partner exclusively with Facebook. Whew! At least $50 million buys a great roller coaster ride. I look at Jobster and see a site at this point just hoping to 1) drive a bunch of traffic, 2) get a lot of registered users and, most importantly, 3) pull a good number of employers into their database via free job postings, in return for becoming an appealing acquisition target. Maybe if someone like IAC buys Facebook, they’ll throw in Jobster for fun. Dating with your job search anyone?
- The periphery – Take a look at the second tier players in this space and there’s not much to be impressed about. Many are experiments, supporting sites to bigger ones, drowning without an acquisition lifesaver or, worse yet, none of the above. I think you’ll see a lot of death and destruction in the coming year.
It makes me sad. I hope I’m wrong. I’m a big fan of vertical search in general, but particularly for jobs. I think users prefer a single destination to search multiple boards and employers. And I still believe the idea can work in the right environment. Google Base is seeing improvement and traffic mammoth Yahoo! has a lot of potential integrating job content from around the Web.
However, the unfortunate reality may be that no matter how much the verticals provide a great service, pleasing the investors who have poured tens of millions into seeing big money probably are not all that pleased right about now.
That said, a majority of the primary verticals have told me to be on the lookout for enhancements that will “blow your mind.” We’ll see. Blowing away the revenue projections would probably be more important at this point.
Popularity: 9% [?]
March 13th, 2007 at 7:10 am
We’ve been looking into the possibility of running an vertical search engine for the group for a while, particularly in China. http://www.keljob.com seems to be a very successful business and there are other smaller successes in regions outside the US
Keljob don’t sell advertising to job boards but to recruitment agencies and corporate employers. The problem with this is that you have to pick
So its better to look at the conditions that allow success rather than writing off the sector.
In markets where recruitment agencies and corporates tend to run their own websites and there is no clear No. 1. in the job-board market there.
March 13th, 2007 at 7:27 am
Interesting post Joel, as Brendan says it’s worth looking further afield. Here in the UK there are at least two successful vertical search engines (we’re one), both revenue generating, and without the huge investment needed in the US.
simon
March 13th, 2007 at 9:41 am
Joel,
You should not be sad that there may not be a future for dozens of vertical search engines for jobs. Vertical search – by definition – aims to be comprehensive, so job seekers don’t need choice to conduct a comprehensive job search; they can just go to the best search engine for jobs. At Indeed, we’re continually improving our service to try to be the best.
How do you define the *best*? We believe it is the service that provides the freshest and most comprehensive index of jobs, the most relevant results from any search, and the most useful set of tools for job seekers. From the point of view of employers and recruiters, this translates into the most targeted and qualified traffic of job seekers. As more and more job seekers use the service, employers and recruiters benefit from rapidly growing *free* organic job seeker traffic. But its not just a high volume of traffic, it’s also highly targeted. This is because the most comprehensive and relevant search results yield the best *matching* between candidates and jobs.
Just like general search engines, employers and recruiters don’t have to rely on organic traffic from vertical search. At least on Indeed, companies and job boards can boost the visibility of their jobs on a pay-for-performance basis. You can sponsor your jobs so they are displayed above our organic search results – and you only pay when users click through to the job listings on your own website.
More and more companies are seeing the benefits of the candidate traffic from vertical search. Indeed now has over 250 clients, a number that grows by the day.
Paul
CEO, Indeed
http://www.indeed.com – one search. all jobs.
March 13th, 2007 at 10:00 am
Provocative post JC … From a job seeker perspective the verticals are the best search tool out there. Problem is they are still only a blip on the radar. The Monsters of the world are big consumer brands and they spend the money to get noticed. If the verticals ever want to overtake them, they’re going to have to do the same in order to enter the job seeker conscious.
I understand they want to grow organically but that will only take them so far.
March 13th, 2007 at 10:43 am
Joel, interesting post. I think that jobseekers inherently want to go to one place for every job on the planet, and I think Google is in the best position long term to make that happen. We are a regional job board, and Indeed is a great site, and we were one of the first keyword advertisers out there with them. However, we recently put our pay-per-click for featured jobs and adwords on hold so we can evaluate more effectively what we’re really getting.
Recently, we were asked by Jobalot.com to send them a feed of our jobs, and I asked the sales rep why they were getting into the vertical search space, and they said “because everyone else is”, but she didn’t know really how they were going to make any money with it. It is cool to be vertical these days. Not sure why. We’ve resisted the urge to mix tens of thousands of free jobs in with our paying customers; without supporting marketing, we’ll just dilute the applicant pool and focus of the paid jobs on our site. We have over 9,900 jobs on our site, all paid. All the verticals want to give job boards “backfill” so that we can share in the revenue of the clicks. OK, so I send my jobs to the vertical, and then they send them all back to me. Interesting.
Many of these verticals look to job boards to make money (topjobsusa.com, indeed.com, simplyhired.com), but the question we are trying to answer here is: which verticals are delivering the most applicants? Pageviews are good, but our clients pay us to deliver applicants. One of the most successful experiences we’ve had is with GoJobs. They house and display the entire job description on their site, and we only pay when the applicant clicks the ‘Apply Now’ button – we send them right to an apply page – nice and clean. This is different than Indeed, who simply charges us when the user clicks on the job title to read the job. Yea, I’m paying for someone to read the job, but that doesn’t mean that they want to apply to it. And, since they’ll probably just hit their back button and leave after they are done reading anyway, I’m not getting much brand or repeat visitation out of that click I just paid for. However, with GoJobs, they push our jobs out all over the web, then move traffic back to their site. I only pay when they push the apply button, resulting in an applicant. Applicants are worth much more to me than views. Now, of course not everyone who clicks the apply button actually applies, but we are getting a 36% conversion rate, which isn’t too bad. They charge me more per click, but I’d rather pay a few cents more for the applicant than just to have someone briefly eyeball our site.
If you’re not careful, you can spend thousands and thousands of dollars on this stuff, but as consumers get smarter, these verticals will have to continue to invent themselves to be a long term play in the vertical jobs space.
March 13th, 2007 at 11:13 am
I still wonder if it won’t be niche job boards that cater to industry sectors that don’t do better in the long run. Sites that can build community and have only jobs from major players and recruiters in the sector where candidates have most of their work experience seem like they would naturally draw more traffic.
Of course the coming labor shortage is going to help buoy any company that looks like a viable resource with which to attract talent. If the large companies could figure out how to run lean and mean, then declining market share wouldn’t be such a big problem for them. When Monster raises prices to counter their loss of customers, I think they’re taking the wrong play from the playbook. Seems to me they should cut expenses and increase the ROI for their users…. that would bring in revenues by the truckload. JMO
March 13th, 2007 at 11:15 am
The verticals are here to stay, the monsterous $600 posting is just too much in this day and age. The key thing over which no verticals have paid a lot of attention is the bottomline. Why do simplyhired or indeed or jobster need close to 100 employees for doing what can be done by no more than 10 people.
March 13th, 2007 at 1:21 pm
Hi Gloria, I can assure you we don’t have anywhere near 100 employees and we could not run our company with 10 people.
March 13th, 2007 at 2:12 pm
Thanks for the clarification Ricky. I suspect you have more like 60 or 70 employees. Is that right?
March 13th, 2007 at 2:50 pm
I’m the former CEO of WorkZoo.com which was sold to Jobster in 2005 and became Jobster’s vertical job SE. I’m also friends with the guys from SimplyH and have bounced a few pleasant emails back and forth with Paul and Rony from Indeed.
You’re right Joel, vertical job search engines (lets call them VJSE’s to save my fingers) are a great product. I remain surprised that Google hasn’t jumped all over it. During my tenure as WorkZoo CEO one of my biggest fears was that I’d wake up one morning and choke on my coffee as I read about Google launching a VJSE and are marketing it on their home page. But the closest thing to that was Googlebase which is a non-event. In my view it’s a branding issue – the average consumer doesn’t associate Googlebase with anything in particular.
The fact is that if you’re looking for a job, you’re probably competing with someone who is using a VJSE and unless you’re using one too, you’re at a disadvantage. So there’s value there. Why hasn’t one of the VJSE’s taken off myspace style? Because the sector is non-viral. People don’t like talking about the fact that they’re looking for a job and even if they did it’s statistically improbably that the person they’re talking to is also looking for a job and is going to rush to visit the site they mention.
Because the sector is non-viral, I’d say the best strategy is to partner with someone that’s bigger than you are. We all agree that VJSE’s have value and if you’re running a high traffic consumer facing website that hasn’t sold it’s soul to one of the big 3 job boards for a few extra bucks a month, then you can add a lot of value to your consumer experience if you give them the best job search engine available.
Why hasn’t this happened yet? Perhaps the world was waiting for Google to jump on VJSE’s which hasn’t happened. Or maybe they didn’t get that VJSE’s are better than the big 3 individually. Perhaps they thought they were an overnight thing that’d be gone tomorrow.
Whatever the reason, I think (and hope) you’ll be seeing more partnerships like the Jobster/Facebook relationship. It may be the only way that vertical job search will grow up.
Mark Maunder
March 13th, 2007 at 5:42 pm
I blogged a response at http://www.jobster.blogs.com today
March 13th, 2007 at 10:48 pm
I suppose this post supports what you implied in your prior “content is still king+ blogging for traffic ” post. Write a controversial, generalized proclamation on the demise of an entire burgeoning industry niche and let the traffic roll in!!
A vertical job search engine is above and beyond anything else just a business. With any business the key to success is maximizing revenues and controlling costs.
Vertical search engines have high monetization potential, sponsored jobs and pay-per-click key word advertising have a revenue potential that is only limited by the quality of your execution. The key issue to determine the success of the business is managing costs while refining and maximizing your revenue models.
(This get complicated sometimes when you raise large amounts of cash from third parties, start spending and then get pressured for ROI and profits. This often becomes more of a hinderance than and advantage for the business operator.)
Joel, you don’t actually offer anything to support your prediction on the demise of vertical job search engines. Aside from mentioning that Google Base and Yahoo! are making improvements in the space!!! and as another commentator mentioned there are several examples of profitable, and independent vertical search engines on an international level.
I think this blog post could be a master business school case study on blogging for traffic by way of controversy.
Maneck Mohan – http://www.recruit.net
March 14th, 2007 at 10:53 am
There’s still a lot of missed opportunity going on out here. I don’t think Google has entered the space aggressively yet. While Indeed, SH, etc. are well known to us, the general public still thinks Monster, CB, and HotJobs. Until that changes, Google has no need to hurry. Let’s not forget either that in Google terms, this is not really that large a market, compared to, say, auctions. Monster’s EBITDA was a little under $300m last year, while Google’s was 4.6 billion and growing at frightening rates. Just to drive the point home, right now Google effectively grows a Monster-size business each quarter with far better margins. This isn’t an entirely fair comparison but it highlights the issues at hand.
Why would they want to acquire SH or Indeed? I could be wrong but I doubt either of them has any technological secret sauce which would give Google a meaningful edge. Both of them focus on aggregation, which Google hardly has any trouble with. Meanwhile, neither delivers a great search experience to the end-user, as Bob Wilson has documented over and again, which is something I could see Google making an acquisition for.
What about the Youtube precendent? I think the verdict on whether Youtube was a good acquisition for them will have to wait a few more years at least. That being said, by the time it happened, YouTube had become one of the few truly indispensable sites on the Internet. If Viacom had sued them out of existence, we’d all feel a void the way it felt when Napster was shut down. I’m not certain that vertical job search will ever achieve anywhere near this level of presence, seeing as the potential market could be two or more orders of magnitude smaller, but certainly neither of them have hit this level yet. Another important difference with Youtube is that it’s more like a wine cellar, whereas a vertical search engine is like a flower shop. A lot of YT’s best content is many years old, while job content currently declines in value almost the minute it’s posted.
March 15th, 2007 at 5:19 am
Referral site then vertical job search engine then social network then layoffs then free-for-all and spending God-only-knows to partner exclusively with Facebook.This article is very interesting for upward carrer mobility.
click on this link to get more information
http://www.UpwardCareerMobility.com” rel=”nofollow”>How to Get the Job BEFORE It
March 15th, 2007 at 1:34 pm
Joel, now that pulled in some traffic huh!
March 15th, 2007 at 8:20 pm
Joel,
Great Post.
And thanks to Joe, for giving our GOJobs.com website a great recommendation!
Vertical search is great for job seekers. (Indeed had approximately 4 million uniques in January.)
Vertical Search and their PPC models are also great for ALL employers and job boards!
The problem is that the only people who get it, are the guys/gals in the industry.
Indeed and SimplyHired don’t have the resources to educate directors of Recruiting, which is required to get the employers involved.
Job board owners get it…
The Cost of Acquiring a job seeker, with Indeed, SimplyHired, TopUSAJobs, etc is dropping consistently. We have seen the cost of acquiring a candidate down as low as $.60 per resume.
Most employers are paying the big boards about $5-$11+ per resume/applicant. (Average cost per job posting/ number of “resumes” entered in to the database… not “click-thrus”)
For example, say you purchase a job posting on one of the big job boards, at a cost of $400 (for example purposes only, since bulk rates drop the prices significantly), and say you get 40 Applicants (again, an applicant being 20 emails, or 20 resumes in your resume database. This is not 20 click-thrus from the job board to your site, because not everyone who shows up on your website fills in a application).
The result is $400/40= $10 per applicant.
You can massage the numbers to fit your average cost per job posting and your own average response rate, but the actual cost per candidate will still probably come out higher than what you can do with a Vertical Search Engines PPC model, as per below…
Say you sign up with Indeed. You bid $.50 per click through for all of your jobs. (Which you do not have to, because you can bid individually, for some harder to fill positions, etc.) Then, you get 100 clicks from Indeed. Those clicks cost $50 ($.50*100). Of those clicks, say 10% convert to applicants, this means only 10 resumes, from 100 visitors to your site.
The cost per resume is $50/10=$5.00 per applicant, 50% of what the big board charged you.
Indeed charges you $5.00 per resume, and a big board charges $10…
It’s easy to see where the market will go…
There are problems though.
1. You only got 5 resumes… that’s not enough to realistically fill a position with, in most cases.
2. There is a lot of learning and technology required to get this opportunity to work. Fortunately, a lot of this can be handled directly through the vertical, or through someone who can manage the campaigns for you… think ad agency who gets it…
3. The big boards are easy to use. They are Branded, and they know how to sell… Verticals, PPC, SEM, etc, aren’t any of the above.
I guess the success in the Verticals will be derived from the how quickly the market understands the above, is willing to go out on a limb, and how quickly supporting services can help educate and manage these PPC platforms…
I’m through my hat in on the later… a great opportunity for anyone who can execute.
March 15th, 2007 at 10:15 pm
vertical search engines need to figure out a way to keep the visitors on their sites. For example, if I do search for seo jobs in fort lauderdale on Indeed, I will most like see listings from CareerBuilder and Monster. Great! However, when I click on the listing, I leave Indeed and go to Monster or CareerBuilder.
March 19th, 2007 at 8:37 am
Will Social Networks and Vertical Search combine to challenge Google?
Publishers and advertising agencies have a very difficult challenge ahead as traditional “horizontal” media like newspapers, TV channels and magazines see their traditional demographics and advertising revenue streams fragmented by the increasing preference of consumers for online access and the huge presence of Google eroding their audiences and potential future revenues.
Perhaps they should remember the words of Sun Tsu, who once said “When the enemy is too strong to attack directly, then attack something he holds dear. Know that in all things he cannot be superior. Somewhere there is a gap in the armour, a weakness that can be attacked instead.” Google’s major strength – the clean search box and the ease of use, commoditised ad revenues, perhaps masks its principal weakness. As media content and advertising revenues fragment to serve thousands and thousands of “vertical” online communities based on lifestyle or profession, Google may suddenly seem standardised, commoditised and lacking a sense of unique community. Is Google becoming Wal-Mart, while vertical communities may prefer Harrods?
Whilst “horizontal” media companies are similar to supermarkets, specialist professional “vertical” publishers are very specific in serving niche communities with totally relevant content and requirements. However, the publisher’s principal operating difficulty in becoming adaptive to this asymmetric Web 2.0 opportunity is that most tend to run each of their print, exhibition and online titles/businesses as separate profit and loss items on their balance sheet. As a by-product the vast majority tend not to have a centralised IT infrastructure or the human IT skill sets to manage a large scale data centre or web spidering facility – the prerequisites needed to datamine and aggregate open source, user generated and blog content to create vertical slices of the Web that are relevant for their audiences. Publishers will also need to integrate this content into the online extensions of their print brands and thereby allowing advertisers the opportunity to target high value communities. In addition, the datamining, crawling and hosting to identify relevant open source content will also need to be a continual process due to the continual growth of user generated and open source content.
Convera have two very large data centres, an extensive web spidering capability and a web index. Convera are now partnering with a significant number of specialist B2B publishers to create a range of vertical websites for specific professional communities. The first example of this is Searchmedica.com with UBM.
In building the deep vertical search portals, the key is to reach into the specific professional community in a number of ways. First, you can combined the trade publisher’s knowledge and contacts in the profession with community appeals that engage the specific audience in a way that general search cannot, and also by taking special care to use the taxonomies common to the targeted profession in organizing search results so that the user feels more at home and among peers. Building a good vertical engine can be costly and time consuming, and getting a critical mass of users to de-Google their search habits into more specialized engines is potentially a tough sell. However, in tests with focus groups from different professional communities to test these vertical search properties against Google, the results are hugely encouraging.
In building the beta test sites, the specialist publishers are providing Convera with “white lists” of data sources online and websites that would be most relevant to its readers so that the searches are restricted to reliable and trusted information. Publishers are also securing agreements with owners of key proprietary content not normally crawled by Google by leveraging some of its contacts and resources so that Convera can crawl and deliver some of their proprietary content. Another key consideration is getting the user community engaged in the process as co-developers. No matter how bad the results at Google or Yahoo may be for a given professional segment, the interface is familiar and the destination is always at hand. Getting users to think of a specialized brand as the go-to place for business information is the challenge.
A number of publishers are actively assessing the potential of adding social networking to the mix in order to get professionals interacting with each other and adding weekly podcasts by industry experts on issues affecting the community – these additional services will create more community loyalty and also additional advertising and sponsorship opportunities.
The publishers can also use their print titles to drive the audience to the new online areas and this will also assist the transition of their high value print ad revenues to online. Publishers also have exhibitions, seminars, events and email newsletters to assist this transition – and recent research suggests that professional communities will actively attend seminars and events to meet peers and other members of their community. The theory goes that once you get some professionals involved then the viral mechanism or behavioural “Hive Mind” also kicks in and professional workers start referring to the vertical portal as a community source. It is also allows advertisers and public relations organisations access to a clearly defined, affluent, influential and stable audience.
Google does not allow you to have a beer with a potential business partner – it doesn’t have that sense of community. But Google is fighting back – the recent launch of Google Custom Search and acquisition of teenage social network sites indicates they are aware of their weakness – but specialist publishers see this as a Trojan Horse. Social networks for teenagers are highly transient and target a demographic that is volatile, unpredictable and has a low level of disposable income – whereas a social network alongside a vertical search service for 22,000 bio-chemists, 55,000 UK GP’s, 55,000 insurance risk assessors or 120,000 US psychiatrists is stable, affluent and attractive for advertisers.
March 6th, 2008 at 2:26 pm
What do people think about “niche aggregators”.
As far as I’m aware we’re the first of what I suspect will become a new breed – aggregate vacancies from evereywhere a la Indeed/Simply Hired, but then filter down to just those jobs relevant for a specific audience.
That way jobseekers get the best of all worlds – only look in one place, and no dross to wade through.
It will rely on the aggregation PPC business model solidifying is the only thing…
Any expert thoughts???
March 14th, 2008 at 11:14 am
I’ve just launched my new Job Search site JobGeni.com (beta) – The Spider that aggregates the best job boards on the web with the new Google AJAX Feed API.
No nightly spidering, no big servers, just realtime rss feed search! have a look:
http://www.jobgeni.com/
September 25th, 2008 at 5:59 pm
You having a laugh Joel ? vertical job search is just being born so how can the writing be on the wall ?