Today, Monster is the largest job search engine in the world, with over a million job postings at any time and over 150 million resumes in its database and over 63 million job seekers per month.
In addition, Monster.com is one of the 20 most visited websites out of 100 million worldwide, according to comScore Media Metrics. Sounds good, right? Wrong.
Monster.com is in Big Trouble. Not because of the economy and a reduction in the number of open positions; rather, they have created an unsustainable business model.
Let’s do the math. If Monster.com has over a $1 billion dollars in revenue and a market cap of $7 billion dollars, how many job posting does it need to obtain from companies if those postings are only $1 each?
Wait, a dollar each? But they currently charge hundreds of dollars for postings. How can they charge only a dollar? You can put down your calculator. As opposed to those tricky word problems on the SAT’s, the answer to this question is easy – they can’t. Just like General Motors trying to sell big automobiles when Honda and Toyota were introducing smaller and less expensive cars, Monster.com is faced with a situation in which they have created an enterprise that can not survive against a lethal enemy – social media.
Facebook. LinkedIn. Twitter. Even Craiglist. All are growing more and more each day and are taking larger pieces of Monster.com’s revenues. You may be thinking, ‘but Monster.com has all those visitors, they can live off the advertising.’
No they can’t. Monster.com can’t produce $7 billion dollars worth of advertising. Plus, as people use social media more and more the number of visitors to Monster.com will actually decrease, thereby causing its advertising revenues to drop.
And we haven’t even talked about free postings. Here’s another math problem that Monster.com may want to think about. One million postings times zero equals…zero. Zero revenue. Uh oh, what is Monster.com going to do with all those inside sales people making $100,000 a year?
While there are companies that offer free postings, and the thought does sound attractive, many agree that without some type of financial barrier the quality of jobs on free sites will be diluted through scams and multilevel marketing schemes.
Does a company like GE, for example, want its posting next to a posting for a gentleman’s club? I would guess no. So, we are back at some type of fee – maybe a dollar – per posting. Or if a dollar doesn’t sound right how about posting all of a company’s jobs for an annual fee, maybe a few thousand bucks. Still this price is extremely lower than what Monster.com can offer – with the same reach. Twitter alone has 19 million users.
And don’t take my word for it. Wachovia investment analysts recently downgraded Monster’s stock saying, “The low marginal costs and incentives for price competition in online recruitment raise concerns over industry fundamentals – pressures have been mounting, with more frequent & larger promos. Channel checks suggest the industry may be on the verge of more price cuts that would further commoditize online recruitment, and the earnings power of the biz model.”
Unfortunately for Monster.com they have gone away from their entrepreneurial roots. Once run out of an office in a Chinese restaurant, they now have all the typical garbage that most big companies take on as they think the gravy train will never end – fancy offices, sales meetings with buffets that could feed a small country, and all sorts of Vice Presidents with loads of stock options. But the gravy train is ending. And unfortunately for Monster.com, no bailout money is coming down the road.
The only thing in their path is Twitter, Facebook, and countless entrepreneurs who have figured out that the only difference between Monster.com and General Motors is that one will be able to say they were in business 100 years and the other will be an organization that didn’t even make it to the age of 20.
Popularity: unranked [?]
June 1st, 2009 at 11:15 am
Well done Gary, you are spot on Sir. When will HR professional start relying on the data and realize Monster has a ridiculously high ROI and piss poor results!!!
June 1st, 2009 at 11:39 am
Gary, well written piece. I would also argue that is could spell doom for the other players in this market place who strive for a piece of the Monster pie. For example; Jobing.com’s “leadership”, has always felt that they are just a player in the postings market place with ambitions of going public someday. Well, I think we can all say with confidence that the days of Job Boards going public are past us (sorry Jobing.com and all of the “employee owners”). Unlike other industries from years past, the time it takes competitors to create a web-based offering that is similar and or better is minimal. With all of the free technology that is readily available on the web today, businesses like Jobing.com need to figure it out quickly or else all of that venture capital they received may be going to waste. Wait, hasn’t it already gone to waste? It has always been a romantic notion to start with an eCommerce organization with grassroots efforts with people who give it there all, kill themselves for the organization and destroy any sense of what life is truly about. But as we see, organizations change as well as the identity on which the company was formed. It is my fear that Jobing is following the Monster model and turning into the “little monster” that people cant stand. Here’s to getting the economy turned around and truly helping the communities job boards say they serve. What’s next, charging jobseekers for a offering that is useless? Jobing leadership, current employees (what’s left of them) or Joel, do you have anything to say?
June 1st, 2009 at 12:31 pm
Another problem with Monster is that it is next to impossible to have success with it (as a job seeker.) Before I got my most recent job, I looked around on Monster and never had any success – with sites like Monster, Career Builder, etc, you are just another piece of paper in a stack. Most of the companies I’d want to work for have the luxury of hiring someone who has inside references (friend of a friend) or can just post the listing on their company website. The best way to get a job is still through word of mouth, and knowing the right people (which speaks to your point about the success of LinkedIn, Facebook, and even Twitter.) If you want to get a job, get networked. As more people learn that, I think sites like Monster will have more than just a poor business model to worry about.
June 1st, 2009 at 1:26 pm
The evolution of the recruiting world continues to roll on. Monster.com is seeing the change in the times like the rest of the world. With the advancement of social media, recruiting sites will continue to change to fit in or they will become obsolete.
Wouldn’t it be nice if they could create a Linkedin version of Monster.com?
June 1st, 2009 at 4:00 pm
Gary,
You lost your credibility at 63 million job seekers, 20th most visited website and 150 million resumes. Your math doesn’t add up at all, but you do have some points, as vague as they are. The Monster’s of the world need to retool and job postings aren’t the future, so to think that’s all they do is off base. I don’t work for Monster, so no bias here. If you can show me anything anywhere that says 63 million job seekers as per Media Metrics, then I’ll eat crow, but until then get your facts straight.
June 1st, 2009 at 6:01 pm
Hi Bruzzy: Here are some stats…where should the crow be sent :) It seems many of those numbers come from Monster. If they are inflating the numbers then the article is even more spot on than Gary thought.
June 1st, 2009 at 6:02 pm
http://en.wikipedia.org/wiki/Monster.com
whoops…here is the link.
June 1st, 2009 at 7:51 pm
I agree with bruzzy. i work for monster and we have never had 63million. it is more like 10-11 in N.A per month. I think careerbuilder does about 24 and HJ is at 15-17M
June 2nd, 2009 at 10:11 am
…I work for Monster as well and we haven’t scratched the surface of how much global opportunity lies in front of our choppers. We are the number #1 Job Board Globally and we are winning the war on talent. If you don’t believe me, just ask Mr.Iannuzzi…”Monster stands for Integrity and Governess” ….” Monster’s future is bright”…”Companies are still recruiting and hiring, as dark as things may seem”
http://video.google.com/videosearch?hl=en&q=IANNUZZI%20SALVATORE&um=1&ie=UTF-8&sa=N&tab=wv#
June 2nd, 2009 at 10:49 am
Hi Gary,
While the role of the online job board is certain to change, and we are seeing the beginning of that change now, I do take a bit of an issue with your post, although not necessarily with your conclusion. It seems to me that the best way to write an editorial piece like this would be to do your background research before you form your conclusion/opinion. What you have given us above is your opinion, backed up by logic that is at best, faulty, and absolutely no hard facts to support your stance. Monster is a public company, and their financial records are on display for the entire world to see. Likewise, their traffic numbers are available, if you research them. To broadly state that their business model can’t survive on $1 per job posting, and ad revenues will decrease as traffic decreases breaks no ground. We can all draw that conclusion for ourselves. It would be nice if you were to lay out why traffic would decrease, and why they would only be able to charge $1 per posting, or a flat fee for posting all open positions. In the piece above, you did none of that, save for a few vague references to social media. Along with that, as I read your bio, I can’t help but notice that your most recent venture involves, *surprise!* social media. How convenient. If you would like for your opinions to be taken seriously, and be considered an expert in the field, you would do well to hold yourself to higher editorial and journalistic standards, even if this happens to just be a blog. To do any less would only serve to lessen your credibility among these readers, and consign you to the nameless, faceless, rabble of the internet, the dreaded abstract known as “the bloggers”. Take that for what it’s worth, and have a nice day, cha cha.
June 2nd, 2009 at 11:04 am
Then perhaps your Media/PR folks should be paying closer attention to information and data that’s posted on sites like Wikipedia.
If you’re going to split hairs over a published stat, you’re missing the point of the article. Let me be as clear and un-vague as possible: Social Media is a game changer in this industry. Companies who do not realize that or have the vision and willingness to adapt will ultimately fail.
June 2nd, 2009 at 11:12 am
I heard a “trusted” rumor today that Monster Global has taken the corporate decision to not let job search aggregators index their jobs?? This decision will only help the aggregators and with the fall of Monster. Another archaic decision.
June 2nd, 2009 at 11:18 am
63 million worldwide perhaps? not just united states.. ?
June 2nd, 2009 at 12:38 pm
Gary,
Please tell me you didn’t get your stats from Wikipedia. It appears you did which is unfortunate, you lose a lot of credibility. I happen to agree with you but trying to prove your point with Wikipedia is poor journlist integrity. You should have called Monster PR and asked for current stats.
June 2nd, 2009 at 1:12 pm
Gary – Twitter, myspace and Facebook (social media) are not game changers in anyway shape or form. A recruiter or hiring manager is better off goggling professional titles with the name of the city they want to hire then trying to find candidates on those social media sites. When you use Google, at least you’ll find names and some information from sites like Jigsaw, zoominfo, linkedin, lead 411 etc. I speak with employers and recruiters everyday and we all scratch our heads and wonder how is it that people think you can source candidates with specific skills in specific metros using any of those social media sites. Sorry, they don’t do that.
Linkedin is a little different but the profiles are passive, not active job seekers. Even linkedin is still a keyword/classified/pay-to-post job board….BFD. What’s the game changer? Linkedin can help you identify passive candidates just like any resume database can OR you can post a job on linkedin’s job board and reach active job seekers just like any other job board. So whats game changing about this? Monster had a passive resume database as well as a job board 15 years ago. Linkedin is either a resume database of passive candidates or it is a job board which reaches active job seekers. That Linkedin is also a social media outlet for its users to connect with their own friends and colleagues is irrelevant for the purposes of a recruiter finding a candidate.
June 2nd, 2009 at 3:58 pm
Rich – Gary,
If you really used Wikipedia as a source for data then that is really sadder then I thought. I could make myself anything I want to be on that site, plus you specifically referenced Media Metrics as your source.
63 million worldwide isn’t even close, nor is 150 million resumes and the 20th most visited website?? In about 11 seconds I went to Quantcast and Monster lists as the 50th most visited website, so you’re 30 off big guy. http://www.quantcast.com/monster.com
Social Media is huge and here to stay, but companies like Monster will need to adapt in order to survive. Any company simply slinging Job postings likely won’t be around very long, but you don’t give them much credit. Take a look at the offerings they have, it’s very naive to think they only sell job postings.
Get on your game guys, this is lousy writing…
June 2nd, 2009 at 5:09 pm
Do a search for “150 million resumes monster”, and you’ll find many places referencing these facts. Wikipedia just summarized the data.
In FACT, the company that powers the Monster.com job search index even states it:
http://www.lucidimagination.com/Community/Marketplace/Application-Showcase-Wiki/Monster
Are you Monsterites saying that the company that is most intimate with the sizing, tuning, and indexing of the datastore for jobs and resumes at Monster is giving false information? Or doesn’t know the number of records they need to index? Or doesn’t know the expected traffic to the site for scalability planning?
This furthers my point: Monster has gotten too big to even know what they have anymore….
June 2nd, 2009 at 6:23 pm
Folks supporting Monster.com in this thread probably bought General Motors stock when it was at $40 18 months ago. It is now at 70 CENTS. Monster has gone from $54 a share to $11 in just over 2 years….an 80% drop when the S&P is down about 30% during the same time period. I challenge anyone supporting Monster in this thread to put their money where their mouth is and buy 1000 shares of MWW. My guess is there won’t be a rush of stock orders tomorrow. Face reality folks.
June 2nd, 2009 at 9:10 pm
Another point for Gary…Monsta is so big it can’t get out of it’s own way, kind of like the MWW CEO…
June 2nd, 2009 at 9:58 pm
Interesting article, but I think your passion for social websites and apparent hatred of Monster is coloring your opinion a little too much.
If your theory were true, then it would apply outside of the recruiting world as well. For instance if social websites will take down Monster & CareerBuilder (why exactly do you only target Monster here?), then they would also eliminate the need for websites like Cars.com, AutoTrader.com, eBay, StubHub, Rent.com, Match.com, eHarmony, etc.
You’re basically arguing that any commercial website that connects people and profits off it it will fall in the wake of free social websites. So even websites such as Amazon and Zappos could be vulnerable at some point.
A few things that you’re missing here though:
1. Not everyone wants to use social sites for commercial exchanges. I know a few people who I’m “friends” with on FaceBook who are looking for jobs. They are employed right now, but are looking to leave. When I look at their FaceBook profile, there is no mention of their interest (I would assume they are friends with co-workers and don’t want them to know). In fact, their FaceBook profiles don’t even describe what they do for a living. But I guarantee you that their resumes are uploaded to the Monster and CareerBuilder databases. Yes, they are on LinkedIn too, but as Rafael eloquently explains above, Linkedin is really no different than Monster or CareerBuilder. So for many people, social websites are just that: “social”.
2. In order to get the updates about a job opening from a company on a social platform, the candidate would have to first be connected to that company in some way. So, they would need to “follow”, “friend”, and “link” with a countless number of companies. Just how many companies do you think the average FaceBook user wants to be connected to? How many status updates or tweets per day would they tolerate about a new job post? I have friends, people who I’ve known for years, who drive me crazy with their non-stop status-updates and tweets. There’s no way in the world I want to be connected to companies who could spam me to death. Again, mixing social and commercial has it’s limits.
3. The legal questions surrounding social websites and recruiting are still left to be tested. Users on FaceBook may not upload their current employer/position, but they sure will reveal a lot else about themselves. And in some cases, it’s possible to get too much information. Users on Monster and CareerBuilder know to keep things professional which is much safer legally for all.
4. At it’s roots, Monster is a social website….in fact it’s one of the very first. Users can join the site and create a profile (i.e. upload their resume). Then other users, the employers, can sign up and “connect” with the users by searching through the database. Employers also have the option to post their jobs to a large audience which is not much different than tweeting about a position.
5. Finally….Monster is already very well partnered with the social websites. According to Compete.com, the #1 website referring traffic to Monster is FaceBook. The #5 website is MySpace. http://referralanalytics.compete.com/referral/monster.com
So users on the social platforms obviously still feel comfortable leaving the social bubble to go to a well-known and trusted commercial site. And I would argue that certain activities (job-hunting, looking for a soul-mate, buying concert tickets) are simply better suited for a trusted commercial website.
Are social websites changing the internet landscape? Absolutely. But your gloom and doom prediction for Monster is way over the top.
June 2nd, 2009 at 10:38 pm
I think this is a great post. Social media has definitely changed the face of business overnight. Thanks for the post!
June 2nd, 2009 at 11:19 pm
Sometimes I really think site is a bunch of clueless people in some sort of ridiculous HR circle jerk thinking they know what the hell is going on. Rafael is a perfect example. I’d love to be a fly on the wall of a conversation this guy has w/ recruiters.
Btw…I know you haven’t been in this industry long based on some of the funny exchanges I’ve seen on here…if you’re talking to recruiters while trying to sell something you’re not doing it right.
Try Directors and VPs. Maybe you just haven’t been in sales very long.
June 3rd, 2009 at 10:09 am
Janice,
How many times will you use the word “thread” in a paragraph? Actually I’m not a Monster supporter at all, but trying to draw a connection between Monster and GM is somewhat of a stretch. Typically companies first on the scene like Monster eventually become irrelevant and fade away. If Monster were to stay as strictly a job posting model then that is sure to happen, but perhaps they will evolve and survive by adjusting to the market.
Your multiple references to thread really is hilarious, I love it when people try to sound so important.
June 3rd, 2009 at 10:13 am
Gary,
Of course Monster inflates its numbers you dope, they have for years. You really need to do more homework here big guy. Monster requires forced registration, meaning you have no choice but to leave a resume if you want to apply for a job on their site. They also don’t purge their old resumes and keep them for forever and a day, in fact I’m sure my old Bruzzy resume is there from sometime around 2000. All I’m saying is that you’re not doing the required research to write an intelligent article. I agree that Social Media is the jauggernaut today, but like anything you have to understand how to make it work for you.
June 3rd, 2009 at 12:07 pm
Clueless – When you get the courage to identify yourself and tell us why you’re to right and im so wrong, we’ll be happy to consider your view.
June 3rd, 2009 at 1:19 pm
I have seen 2 intelligent posts on this page, Standards and Rafael…all the rest are garbage including the original post.
June 3rd, 2009 at 4:32 pm
I definitely do not agree with you Gary! I have yet to have a customer tell me that they are not renewing because they are having success with Twitter, Facebook or any other social media sites. Monster continues to evolve and infact, Monster now has a product that links your Monster job postings on to your company’s Facebook or Twitter pages. Until people thinkg of Facebook and Twitter as a place to go for employment rather than socializing, Monster and the other job boards will continue to be the place to go. When was the last time that you read about Facebook being able to monetize their site??? Just not happening.
June 3rd, 2009 at 7:06 pm
Gary
Great article, pretty powerful and bold stuff. For the critics: twitter, facebook, others and also forms of social media ARE game changers. I think many industry experts would agree, including Kevin Wheeler (one of John Sumser’s top 5 influencers in the whole industry) Check out this pretty old article on ere
http://www.ere.net/2008/02/14/web-20-recruiting-is-here/
So, those who can’t believe this better get with the game or get left in the dust, it’s called Darwinism. I understand that not everyone is currently using social networks, but for the FUTURE, this is where Gen Y will be.
Gary keep doing what your doing, and do you think their is a chance that Monster may be awakened by this in some form or another and go back to their entrepreneurial roots? Thanks again
June 3rd, 2009 at 9:07 pm
You Tell’em Rafael, I mean Buzzardman!!!
June 4th, 2009 at 11:47 am
Once again folks in my industry take sides of the conversation. Does anyone really believe that a diet of only job boards, only LinkedIn or only social networking sites is healthy?
Does a construction worker arrive at a work site with a just a hammer? Of course not. He may have multiple hammers, screwdrivers, etc.
I am a huge believer that one should go where the talent is. Depending on who you recruit, where and what industry some tools are better than others.
June 4th, 2009 at 8:40 pm
Cade,
Don’t give Gen Y a bad name, go back to school and take a grammar lesson.
June 5th, 2009 at 12:42 am
Hey Bruzzy, why don’t you grow up yourself? Knit picking little things like a junior high girl. Great argument…not. Quit being so hurt and take it like an adult. If you re going to make argument, make it on valid things like MN Headhunter. You re the reason why people can’t have civilized debates.
June 5th, 2009 at 1:15 pm
HRtechy,
Knit is something you do with needles, and nit is used in nitwit, which is what you are.
Also haven’t heard the “not” phrase used in quite some time, your holstered cell phone must be getting too tight or something.
June 5th, 2009 at 9:42 pm
You re a freakin D-smack! Thank you for proving my point.
June 12th, 2009 at 10:22 am
Let me preface this by saying I do not work for Monster and would like nothing more than to see their utter failure.
This is the most self serving piece I have ever read. Let’s see we are supposed to believe that the founder of tweet my job is going to write an unbiased and more importantly accurate analysis of the recruitment industry? Nice job picking the famed failed bank Wachovia as a source of data, why not dig up a Bear Sterns report while you’re at? BTW Monster’s Market Cap is currently 1.6 Billion and they did revenue of 1.3Billion in 2008 looks to me like they are extremely undervalued. They are expanding into China, and are major European players. Rumors of their death are greatly exaggerated. If anything they will be absorbed by News Corp or another Media Company. Now on to the crux of your argument: Social Media = Recruitment Game Changer.
Social media is an important recruitment tool, but that doesn’t necessarily mean the death or dramatic revenue decline of job boards. All the job boards have to do is form partnerships with the social media sites and they will negate any threat posed by social media. Your argument is based on the flawed premise that the job boards, Monster in particular, will not take advantage of social media. If you are correct then yes they are leaving revenue on the table, but that simply is not the case. Monster will sell social media products if they don’t already, and they will capitalize on the social media phenomena.
Twitter is a flash in the pan; it’s a nice shiny new toy that will be neglected for the next new shiny thing. While their rise has been meteoric, the retention rates are awful on twitter. Facebook may have staying power, but people are on there to troll for hoties or look at drunken pictures. Social Media is powerful in that it can get someone fired quickly but in terms of getting a job, I don’t believe people will use it like they do a job board. I hope you sell your business for a nice chunk of change before the fad is over. Maybe Monster will buy it from you, they have enough cash on hand to do so, then again why not just open up a free twitter account and do a live stream of job postings and charge a hefty management fee?
June 15th, 2009 at 9:22 am
“many agree that without some type of financial barrier the quality of jobs on free sites will be diluted through scams and multilevel marketing schemes.”
And Monster doesn’t post scam jobs???
Also, ANY job board whose business model depends on fees per posting will go the same route as Monster. Not only is social networking becoming a more productive means to find work and build networks, many employers now see this new model as the best — and most cost-efficient — way to attract talent.
July 8th, 2009 at 11:24 am
Interesting article and comments. I certainly think there is an awful lot stacked against Monster. I cannot see it even maintaining its market share. New emergents in the market, such as Yahoo Jobs and LinkedIn, not forgetting the influx of recruiting via Social Media; though question marks remain over the success and quality, twinned with confidentiality, privacy and trust issues. One overlooked point, is in the rise of Flat Fee Recruitment Agencies, which offer a low cost alternative, and for me as a part owner of a SME, this is ideal and most cost effective than the 20% rate of salary other agencies. Particularly appealing in a recession time. Food for thought…
August 14th, 2009 at 5:47 pm
Social networking is DIFFERENT than social media. Social media is the “tool”. Social networking is what you do with the tool. Social media and social networking must be used as part of an overal strategy -they are not and end or a means unto themselves. Social media will not eliminate paid job postings but instead (if used correctly) will help increase exposure of job postings posted on paid job boards. Rafael is making a lot of sense when he says you can not source from facebook and twitter. Try a search for people by criteria, currently looking for work, past experience, what skills they have, what job they are looking for, where they currently live and where they are willing to work. No can do with social media… sorry. The reverse is true for job seekers, can’t search for jobs on the major social networking sites based on skill levels, location, industry, etc.
What these paid job boards need to do is (incorporate) social media properly and they will survive.