During a presentation that involved many of publishing company Gannett’s executives talking to media and entertainment analysts last week in New York, CareerBuilder CEO Matt Ferguson discussed the job board’s overall health and their global feats over competitor Monster.com.
According to Ferguson, Careerbuilder, in which Gannett owns a controlling interest, picked up significant market share last year.
“If you look at our market revenue, which is that revenue sold by CareerBuilder and by our newspaper affiliates, we went from $768 million in 2007, down to $740 million,” Ferguson said. “But the same time in North America, Monster went from $707 million, down to $640 million.”
He added that this momentum doesn’t appear to be slowing since analysts predict Monster dropping somewhere between 25 to 40 percent in 2009. “Clearly…this is a more challenging environment. So I’m not going today to tell you that we’ll see revenue growth in North America. But I think we have a chance to pick up significant market share if, in fact, our major competitor’s down to 35 to 40 percent.”
The revenue sold by CareerBuilder in ‘08 versus ‘07 was up 13 percent year-over-year from about $495 million in North America to $558 million. But due to a weakening economy, Ferguson said that client contracts are becoming shorter in nature and smaller in number.
Ferguson did not address the job board’s layoffs that occurred last year or recent salary cuts that were allegedly enacted. However, he did say CareerBuilder has not lost a lot of customers and that he expects business will soon pick up again.
“When I look at it if people are optimistic that the labor market could stabilize this summer, then we could see some growth in our business in the late fall — certainly, as you go into 2010.”
This forward momentum will be used to further strengthen CareerBuilder’s market share internationally. Ferguson addressed aggressive expansion overseas that would potentially threaten Monster’s own growth, including a new deal that will allow the job board to launch in China this April or May.
While online recruitment continues to drop in international markets, Ferguson said he is confident that the coming years will bring stronger numbers.
“All [online recruitment revenue is] going to be back up above those high water marks when you look at 2011, 2012. There’s still huge amount of growth in this. This slowdown allows us to continue to reposition the company — be able to take advantage of this international platform as we come out and those markets in Europe, India, and China start growing again in the future.”
Ferguson also discussed other products in their portfolio that he said CareerBuilder will continue to invest in: Personified, an HR consulting division around the recruiting process, and CareerBuilder’s niche sites like WorkInRetail.com.
“My view of niche sites is they’re applicable for two reasons. One, the customer does not have a belief that an hourly worker in retail will be on CareerBuilder,” he said. “You have to have the second reason, which is the price point for a cashier or a waiter or waitress that turns over 400 percent a year, may not be at $400. When you have a combination of those two things in a market that we don’t really have the jobs like hourly retail, it’s appropriate for us to do a niche site.”
Because of “a really good response” from the niche sites, Ferguson said they will roll out more sites in various industries, including construction and hospitality.
Overall, Ferguson seemed positive about Careerbuilder’s market share and the growth and regeneration of the online recruitment market. He made some final predictions about future opportunities.
“The growth rate has come down certainly, but you’re going to see growth in [India and China]. We want to be there to capture those long term. And then Europe — I think Europe will have a rougher time as I look at the beginning of 2010. It will be strong again in 2011 and 2012, and this will be a very good business there.”
Popularity: unranked [?]
March 30th, 2009 at 8:58 am
This is one we will keep an eye on.
March 30th, 2009 at 9:28 pm
Reality Check:
1) Most labor economists expect the Labor market to continue to hemorrhage jobs until the end of the year. On Friday, many wallstreeters think the US will report 600k lost jobs in March. IBM, a healthy company just laid off 5,000 people. 2010 is probably the earliest the labor market stops shedding jobs. US Employment growth won’t happen until 2012-2013 according to most experts. Assuming the online recruitment market returns to “high water marks” by 2011 or 2012 is probably too bullish.
2) If Monster’s revenue is expected to fall from 25-40% in 2009, are we to believe CB’s fortune will be different? 2009 is the new reality for several years not an outlier, if analyst are forecasting a decline in revenue for monster, it would behoove CB to expect the decline in their revenue to be inline. Getting back 25-40% of revenue is a tall task.
3) With the rising popularity of Twitter, Facebook, LinkedIN, and whatever comes next, are we to believe that the 1.0 job boards are going to be able to gain the market revenue that they lost? The US online recruitment industry is moving into 2.0, CB and Monster are shilling 1.0 solutions in a 2.0 world.
Short-term: Both CB and Monster probably will be forced to reduce their headcounts further between now and the end of the year. The analyst forecasts cited by CB CEO seem to predict that staff cuts will be the only way for both to be positioned for the future. Revenue can’t fall that fast without employee cuts.
Long-term: Anyone in this industry should be asking themselves if this economic crisis is just a cyclical downturn or if its a “game changer” for the industry. If its only cyclical in nature, then both companies will come back to pre-crisis revenues eventually and continue to grow. If the current downturn is a game changer, then perhaps we are watching the painful decline of two empires.