The importance of employer branding in attracting and retaining talent

The Importance of Employer Brand in Attracting and Retaining Talent

If you are a company eyeing the best talent in the talent market, then employer branding should be a high priority task for you. Having a reputable employer brand is also important as it helps reduce the hiring and marketing costs, & improve productivity. Companies like Google, Facebook and Apple invariably end up getting the best talent, not because they are offering the best salaries. There are many other organizations that offer competitive pay packages. The difference lies in the brand value that these companies offer to their prospective employees. It’s their brand value that tempts the best candidates to apply and get a job in these organizations. The next question you must be asking is “as an HR what is the importance employer branding?”

What is employer branding in HR?

Employer branding is the term coined by Simon Barrow, a consultant, in 1996 to refer to the strategic and marketing efforts of an organization to make it appear as an appealing place to work in. It is a targeted exercise to construct a positive perception for potential employees, current employees and the general public. It is a critical piece of the overall HR functions as we are living in the times when the talent pool is shrinking and it is becoming progressively difficult to find and retain good talent.

“Employer Branding establishes the identity of the firm as an employer. It encompasses the firm’s values, systems, policies and behaviours toward the objectives of attracting, motivating, and retaining the firm’s current and potential employees.” (The Conference Board: 2001)

To have an effective Employer branding it is necessary to align management and HR practices that create an employee experience matching with the perception portrayed. There has to be in place an efficient and streamlined talent management system which includes recruitment, onboarding, training and performance measurement.

What are the benefits of employer branding?

Employer branding is one of the vital instruments for organizations to differentiate themselves from the competition. It also helps improve organizational performance in different HR functions such as recruitment, retention, and engagement. Researchers further argue that employer branding provides means to retain the best employees.

The positive outcomes that employer branding has on an organization are shown in Gaddam’s (2008, p. 47) ‘Employer Brand Model’:

Benefits of Employer Brand

Benefits of Employer Brand



Employee Attraction is one of the key benefits of employer branding

According to a research by Glassdoor, 11% of job seekers would decline a job offer from an employer with a bad reputation, even if they were unemployed. The new generation of workers is more attracted towards workplaces whose culture aligns with their core values and beliefs. This is the reason why Millennials have a reputation of being frequent job hoppers. With internet permeating into every corner of the smartphone wielding globally connected workforce, there is an instant access to information regarding a company, or a business. Therefore, it is important to build a strong employer brand as it will control the reputation of your company and ultimately determine whether the top talent will choose to explore the company further for a job opportunity or move on.

Further, if the company has a very strong employer brand, chances are that as an employer it would not have to go out looking for “the talent” but talent would come around looking for them and eagerly choose them as their preferred place to work.

Employee Satisfaction is another benefit of employer branding

A strong employer brand effectively means there is a clear communication in place with regards to the company’s culture, and mission.  This will lead to informed recruitment where only candidates who think they fit the business will apply to job openings. These candidates, when hired are also more likely to engage with the business and feel more satisfied with the work they are doing.

Employee Retention is why employer branding is important

Better employee satisfaction results in improved loyalty, which, in turn will lead to higher retention rates. Companies who prioritize employer branding, experience a 28 percent increase in retention.  This is mostly achieved by making sure that values promised as a part of employer brand are practiced even after the candidates are hired. For example, if one of the values you promised was continuous growth and development of employees, then make sure that you provide ample opportunities to your employees to improve their skills.

Improved organizational performance is one of the benefits of employer branding

Retaining the top talent will provide company with a competitive advantage and reduce the expenses associated with recruiting and on-boarding new candidates. Also, high retention rate builds knowledge and skill within the business, which leads to better performance and improved bottom line.  Strong employer brand is closely related to a better customer experience as the quality of service offered by the employees depends on their satisfaction levels at the workplace. Happy employees are often responsible for happy customers, which naturally means a better bottom line.