SMEs, tackle labour crunch by marketing to workforce

FOR years, companies have spent their research money on efforts to analyse consumers - the products they like, the reasons behind those preferences, and their ideas for product improvements.

But firms should start to funnel some cash towards engaging prospective employees too, says Danny Lai, country business manager of Acorn Marketing & Research Consultants.

"If SMEs (small and medium-sized enterprises) think they are short-staffed now, it's just going to get worse. With a more competitive labour market, companies will need to know how to define and sell themselves to a job applicant - much like the way they already define and sell themselves to a consumer," Mr Lai tells The Business Times.

It's true that an even tighter manpower squeeze sounds near-impossible; after all, Singapore's overall unemployment rate has been hovering around the 2 per cent mark - a rate so low, the economy is considered by economists to be effectively at full employment.

But the government has also been consistent in its message about the need to reduce the country's reliance on manpower. In his Budget 2015 speech in February, Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam said that companies would have to adapt to "the new normal of a permanently tight labour market". Shortly after, then-manpower minister Tan Chuan-Jin added that Singapore's labour market would get even tighter over the next decade, as local employment growth slows dramatically and strict foreign-worker caps stay in place.

It is against this backdrop that Mr Lai is advocating more research, branding, and marketing activities targeted at prospective hires, so as to shore up employer desirability.

Says Mr Lai: "SMEs are going to need to know how to make their companies more attractive to a shrinking labour pool. They will need to have HR (human resources) practices that move closer to branding or marketing practices today.

"As managers, we'll have to figure out how to build our employee-facing brand, so that we can sell someone on joining the company, and not just on buying our products."

In other words, firms should start studying job applicants the way they already study consumers - find out their likes and dislikes, and mould a desirable company to work at (instead of a product to use).

Supermarket ads

Mr Lai adds that beyond research, marketing to potential employees will be key.

"For starters, think about how job ads are done. Right now, if you flip through the Classifieds pages, 90 per cent of the job ads are 'supermarket ads'. In marketing parlance, supermarket ads are a very low level of marketing, because you're saying: 'I'm not going to spend too much time getting you to love my brand or product, but here's some broccoli. If it looks right, go buy it. If you're still not convinced, here's a 20 per cent-off offer.'

"But where's the effort to create desirability of the job, beyond the physical specifications? I would say a vast majority of job ads are like this: this is what we require, come for an interview. So our job ads are functional, and I think us SMEs really deserve our lot when we can't find talent willing to join us."

While harsh, Mr Lai's views echo those of others. Tay Hong Beng, head of tax at KPMG in Singapore, has long held that local companies can do more to brand themselves both locally and internationally.

Mr Lai also notes the difference between having a strong brand that consumers recognise, and one that people want to work for. "Some of our SME bakeries may mean something in the consumer space, but currently don't carry any desirability as a place to work."

But if job ads are to evolve beyond the typical supermarket ad, what form would they take?

"Look, we're not learning about BMW by reading BMW ads," says Mr Lai. "We learn about BMW by so many touchpoints - looking at the product on the street, passing the showroom, seeing them featured (in popular culture). I think there's this concerted effort by a lot of brands to portray a certain type of image or desirability - I think job ads would turn into something like this.

"Where characteristics that are not necessarily consumer-facing are highlighted to show a company's culture (and what it stands for). Maybe we'll see fewer advertisements in newspapers, and more engagements in schools."

He is also the first to admit that his very own industry - the marketing & research landscape - is not immune to change, either. Service offerings and skill sets will need to evolve, he says, to keep up with changing client demands and advancements in technology.

For instance, while social media has proven a useful tool to aggregate consumers' views, Mr Lai says that companies will increasingly want more value-added service from marketing & research firms.

He believes that firms will soon be less fascinated with social media as a resource for learning what people feel about their brand. Instead, online chatter will be integrated into the strategic planning process.

"In the next five to seven years, I think there will come an inflection point where we feel that it's maybe not about how much more we know, but about how we can marry what we know into our product planning. Things will no longer be at the reactionary level - using social media to spot spikes, to see who's talking about a new product launch. That information will be in the background as a given, and clients will ask: 'How deep does this data go, how can we use it strategically?'

"I think the market researcher of today will become the data scientist of tomorrow - assuming we're successful at picking up new tricks."

In his view, researchers will have to know how to extract relevant data from a gigantic pool of information, and make connections between them afterwards - ones that mould tangible business plans. An example he gives: Is there a correlation between weather patterns and buying behaviour?

Scratching the surface

"We're now just scratching the surface when it comes to big data. Companies are going to demand that we use this data to help them move forward," says Mr Lai.

However, he is quick to qualify that traditional tricks of the trade - such as pen-and-paper surveys, and face-to-face focus groups - will not go out of style.

"We need to know how to deliver the goods through a combination of things. (We should) tap the best of what human interactions can bring, as well as trawl data from the net to optimise cost savings. I think it's wrong to say that newer tech-driven tools will replace traditional research methods - just like it's wrong to say that traditional research is superior."