We work with thousands of companies who use CareerPlug’s applicant tracking software to manage their hiring process.
When clients have a difficult time with hiring, they often attribute it to not having enough applicants — or not enough of the applicants they want. But when we dig deeper into their accounts with them, we discover that they have a different issue.
They think they have an applicant problem, but they really have an applicant conversion problem that results in a low recruiting conversion rate.
The Recruitment Funnel: Definition and Overview
Think about your hiring process as one big recruitment funnel. Applicants get poured into the top of the funnel. Some of them get converted into interviews. And then some interviews are converted into hires.
Your effectiveness as a recruiter can be measured by the number of candidates you can move from the top of the funnel to the bottom.
This is critical if you hire a high volume of people for certain roles at your company. But it’s also important if you are only hiring one person. Wouldn’t you want to have several qualified candidates to choose from versus wondering if you are settling on the one person who made it through your interview?
A recruitment funnel is just like a sales funnel. In sales, you want leads coming into the top of your funnel. Then you want to convert those leads to legitimate sales opportunities, and then convert those to new sales. It’s the same thing in recruiting, except it’s Applicants > Interviews > Hires instead of Leads > Opportunities > Sales.
Nothing frustrates a business owner more than potential sales leads being wasted. An ineffective sales process is like a recruitment funnel with a bunch of holes in it. You pour a bunch of leads into the top of it, and they slip through the holes and out of the funnel before they make it to the bottom and convert into sales.
Some people try to fix this problem by spending more money on marketing to pour more leads into the top of the funnel. But they usually just end up with a lot more dead leads.
The same thing happens in the recruiting process. Candidates apply, but not enough of them are converting into interviews (you’ve got a bad ratio of applicants to interview). So you decide to spend more money on job board postings to boost your applicant flow. And often these applicants flow right through the holes in the side of your recruitment funnel. You can get results this way, but it can be expensive and hurt your quality of hire.
There is a better way to get the hiring results you need and plug the holes in your funnel. I have seen this one adjustment double the number of interviews a company schedules and help them fill their openings twice as fast. Here it is:
Contact Candidates Faster for Recruitment Funnel Effectiveness
I have made this suggestion to several clients over the years and have heard about the impact that it has made on their hiring results. But I wanted to take a closer look at the recruitment metrics to validate this.
We analyzed our clients’ hiring performance to see how contacting potential candidates faster impacts hiring results. We use a metric in our system called Time to Contact. This measures how long it takes clients to contact candidates after they apply.
The median Time to Contact for all of the accounts we analyzed in our system is 35.4 hours (or about 1.5 days). The median Time to Hire for these same accounts is 39.3 days.
Next, we analyzed the top 20% of clients with the fastest Time to Contact, and the results were eye-opening. The median Time to Contact for the faster 20% of our clients is 19.0 hours – almost twice as fast as the entire group. And their Time to Hire was 11.3 days – almost 3.5 times faster!
The data is clear: if you contact applicants faster, then you will make a hire faster.
Faster Is Also Better for Sales
The recruitment conversion funnel is so similar to the sales funnel. I was reminded of this recently when we worked on a project at CareerPlug to improve our conversion of inbound leads to conversations with our sales team.
I shared a research study conducted by Dr. James Oldroyd and Insidesales.com. They analyzed the sales funnel results of 495 companies from over 40 industries. Here is what they found on the relationship between response time and sales performance:
The odds of calling a sales lead and connecting with that person decrease by over 10 times in the first hour. And the odds of qualifying a sales lead as an opportunity decrease by over six times in the first hour.
This information alone was staggering. It’s clear that waiting over an hour to respond to a sales lead can have devastating results on your performance. But it got even more interesting when they dug deeper into the response time in the first hour:
The odds of calling a sales lead and connecting with that person decrease by over 100 times between five and 30 minutes. And the odds of qualifying a sales lead as an opportunity decrease by over 21 times between five and 30 minutes. So you are 100 times more likely to reach a sales prospect and 21 times more likely to qualify them if you contact them under five minutes vs. 30 minutes. Wow.
We put this to the test on our sales team and set a goal to contact all sales leads within five minutes. It has only been a couple of weeks, but we have already doubled the number of sales demos we book each week!
“It’s better to be first than to be better.”Al Ries & Jack Trout, The 22 Immutable Laws of Marketing
This quote reminded me of a conversation I had with a client who recruits in a highly competitive space: hair salons. She told me that there is such a shortage of licensed stylists that when they decide to look for a new job, they are flooded with offers.
She said that if they cannot connect with the candidate within 48 hours after they apply, then they might as well throw the resume in the trash because that candidate has already taken a job somewhere else. Sometimes it’s better to be first.
- Come up with a routine to contact candidates faster. Set a response time goal such as “All qualified candidates will be contacted within 24 hours of applying”.
- Give priority and focus to top candidates. Regardless of your overall response time goal, find a way to contact your best candidates as soon as possible. CareerPlug has a Fast Track feature that notifies a client when a highly qualified candidate applies. There is even an option to receive a text message notification.
- Use automation, but recognize its limitations. Sending qualified candidates an automated email is a start, but it may not be as effective as a personalized follow up. Make the email action-oriented, not just a confirmation email. You could use an auto-scheduler in the email so that candidates can book an interview with you (CareerPlug offers this as well). Do what you can to make this personalized, as people will not respond as well if the message feels generic. And don’t hesitate to contact qualified candidates yourself if they don’t respond to your automated message.
- Use text messages to connect with candidates. Clients who use our texting feature to have a 32.1% faster Time to Hire rate.
- Do what you can with what you have. Many of our clients work in the field and don’t have time to respond immediately. After all, they are busy running their businesses! Remember that responding within a day is significantly better than responding in a week. If you cannot commit to getting back to qualified candidates within 24-48 hours, you should consider delegating this responsibility to someone else on your team.