Employee referrals are nothing new. In fact, the history of referrals stretches as far back as 55 BC, when Julius Caesar offered money to any soldier recruiting another into the Roman army. And way before the explosion of social media and the Internet, many people found jobs through scraping their personal networks.
Unsurprisingly, referrals are still effective recruitment resources today. Forty percent of all candidates put forward through referrals are hired, and 70 percent of employers say that referred hires fit the company culture better than the hires from other sources.
“A person who is cherry-picked by a reliable source holds a lot more weight than a skill path someone self-selects on their LinkedIn profile or a relationship that’s established between a recruiter and their rolodex,” said Chelsea Hobgood, the Director of Marketing & Culture of an app called ReferralMob.
As technology advances, the core of this old approach to employee referral programs endures, but companies that decided to invest in the concept haven’t always succeeded. In the early 2000s, H3.com attempted to tap into that market but ultimately failed. However, H3.com’s plight was before the prevalence of social networks and mobilization, two factors that could transform referrals from an afterthought to an instinct.
“[Referrals] don’t always happen on a platform, a company meet-up, or a recruiting event,” said Vinayak Ranade, the CEO and founder of an app called Drafted. “They happen at the water-cooler, at the random cocktail party, and that’s one of the reasons why it’s so important for us to be mobile.”
Perhaps it was the unpredictable nature of referrals that led to H3.com’s demise. After the flurried exchange of business cards and handshakes that often surrounds introductions, it can be difficult to remember to log on to a third-party site.
Drafted, however, integrates the idea of referrals into a ubiquitous aspect of nearly everyone’s lives: the mobile phone. The app offers incentives to employees who introduce their friends to new job opportunities, aiming to capture the serendipity of an introduction. Through the app—which launched in 2014—Ranade aspires to make the experience of referring a friend more repeatable for companies.
“Right now, all good hiring companies know that they need to engage their employees and their networks in order to get referrals and that it is a good way to hire,” said Ranade. “But they don’t know how to do it again and again.”
That desire to discover a repeatable solution has initiated a trend: new companies that attempt to make employee referral programs incentivized and mobile.
ReferralMob is one of the companies riding that wave. Every successful referral is rewarded with a sizeable sum of cash, enabling companies to gain direct access to valuable connections, including both passive and active candidates.
“We’re handing the power of professional matchmaking over to our users,” said Hobgood, adding that ReferralMob’s users (called “mobbers”) gain access to a curated selection of openings at top companies. “It’s allowing for more quality and opportunity in response to what was typically an ultra-exclusive and homogenous applicant pool of a headhunting or recruiting agency, or the oversaturated world of LinkedIn.”
Both ReferralMob and Drafted attempt to harness the human element that is often missing from the recruitment agency model.
“We, at our very core, are in the business of giving people a greater sense of purpose and belonging,” said Hobgood. “We believe that work should be an incredibly rewarding environment for both companies and individuals.”
Hobgood added that one of the most rewarding parts of the experience for “mobbers” is the moment their friends share the news about their new job, when they can go out and celebrate with money from their signing bonus.
“Being a digital high-five in that regard is something that brings a lot of joy to me and my team,” Hobgood said.
Ranade emphasized that although automation seems to be taking hold of the recruitment industry, humans will always trump computers when it comes to matching people.
“If you’re going to work with someone on a team, you’re going to want to really like who you’re working with. No amount of machine learning is going to replace that desire,” said Ranade. “The best thing for us to do is leave the people who are making these connections more powerful, and give them the tools to do it better, faster, and more often.”
Apps like Drafted and ReferralMob are just the beginning of an approach to recruiting that blends humanity and technology, according to Ranade.
“I think the next wave of really interesting recruiting tools is going to be in that space, where companies don’t just post a job and hope for the best,” said Ranade. “They actually put effort and resources and thought into creating a community around their company to recruit for them.”