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Employer Branding and its Role in Effective

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DOI: 10.26573/2020.14.2.2

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 Employer Branding and its Role in Effective
Recruitment
Puja Kumari
Mili Dutta
BIT, Lalpur
([email protected])
([email protected])
DOI: 10.26573/2020.14.2.2 Manju Bhagat
Volume 14, Number 2 BIT, Mesra
May 2020, pp. 89-100 ([email protected])

The concept of employer branding focuses on the development of a positive

image for the firm. The main purpose of this study is to investigate five- value
proposition of employee attractiveness. Data collection has been done using
questionnaire and analysis has been done through SPSS. The analysis suggests
that value proposition such as interest value, social value, application value,
development value and economic value is related to the creation of employer
branding. Findings also suggest that social value is very crucial value for
employees and for hiring a new employee in the organization. While searching
the job more preference is given to the employer-employee relations and good
relations with colleague so that they can feel sense of belongingness with the
organization. Economic and functional benefits are also important pillars in
creating employer branding. Thus, the various value propositions play a
significant role in attracting potential candidates and ensuring an effective
hiring. However, there is still no specific consistent strategy to attract potential
talent. There has been little focus given on recruiter’s engagement using
various social media platforms.
Keywords: Value Proposition, Potential Candidate, Hiring, Employer
Branding, Employee Attractiveness

1. Introduction
Every organization faces crucial challenges in order to survive in the global
competitive market, to encounter growth, sustain itself (Mosley, 2007) and gain
competitive advantages (Lievens & Highhouse, 2003; Sivertzen, et al., 2013).
Efficient Human capital is the basic need for the survival of the organization;
therefore, recruitment of right and competent candidate becomes a necessary element
for the organization (Wright, McMahan & McWilliams, 1994). Along with this
aspect, the current trend also demands a far more comprehensive and strategic
perspective to recruit, utilize and retain valuable human resources (Guthridge et al.
2008). The importance to attract, recruit and retain talents has been acknowledged by
every organization as they face the scarcity of potential employee in the labor market
(Chhabra & Sharma, 2014). Companies are concerned about their employee’s
opinion, loyalty, retention and their perception towards the company, so they find
what strategy should be made to attract the potential employees (Dabirian et al.,
2016). In a global market, employer brand and corporate reputation are imperative
90 AIMS International Journal of Management 14(2)

factor for attracting the best talent (Cappelli, 2001). Employer attractiveness is
defined as, “the envisioned benefits that a potential employee sees in working for a
specific organization” and the package of benefits in which potential employees
perceive from his future job (Berthon, P., Ewing, M. & Hah, L.L., 2005). Although,
how this attractiveness generated in the mind of the potential employee and
influences them to apply for a job; is still a matter of discussion. Previous researches
have indicated that potential employee compare their own needs, personality and
value with the organization’s image (Backhaus and Tikoo, 2004). When employee’s
desires match with the organization’s image, the organization becomes attractive to
them (Schneider, 1987; Cable & Judge, 1996; Backhaus & Tikoo, 2004). Strong
brand image of a company has benefits such as hiring of employee at low cost,
enhance employee relation, hire best talent in lower pay scale and also helpful in
improving employer- employee relations (Riston, 2002). “Branding” is the
commitment between an organization and its potential or existing customers which
has to be understood and delivered by the organization (Foster, Punjaisri & Cheng,
2010). Employer branding is a tool which is used to enhance employer attractiveness
and corporate reputation (Sivertzen et al., 2013). It focuses on the outside the
organization where there could be chances to convert potential employee to become
the part of the organization (Foster et al., 2010).
Previous literature reviews state the significant impact of employer branding on
retention of employees (Ambler & Barrow, 1996; Armstrong, 2007; Backhaus &
Tikoo, 2004; Chhabra & Sharma, 2014). But a few research works have been
conducted to find the role of employer branding dimensions for attraction of
candidates. In this study we have tried to find out the employer attractiveness
depends upon which of the major factors of employer branding in recruitment
influence them to apply for a job.
The main purpose of this paper is to find out role of different value proposition of
employer branding dimensions on job seekers to attract and influence them to apply
for a job. Organization image perception and attractiveness can influence the job
seekers to apply for the job. The study outlines the key factors or value propositions
of employer branding for the organizational attractiveness. The study will also help
the managers to make the organization more attractive and eye-catching for the job
seekers. The core objective of the study is to determine which value proposition of
employer branding affects employee attraction.

2. Objectives of the Study

The objectives of our study are
1. To study the concept of employer branding.
2. To study the role/significance of employer branding in recruitment.
3. To identify the factors influencing employer branding.
4. To determine the value propositions of employer branding which affects
employee attractiveness.

3. Concept Related to Employer Branding

Branding is a very well-known area of marketing, but it is new and is at the nascent
stage in the Human resource management (Edwards, 2010). The significance of
Kumari, Dutta, Bhagat 91

brand image in product market is well known, but it also plays a key role in
recruitment process (Sivertzen, Nilsen & Olafsen, 2013). In the organization
‘employees’ are the most important resource and ‘brand’ is an asset for the company
(Ambler & Barrow, 1996). Considering other side of view, the employer creates
his/her image as a brand which communicates loyalty, trust, positive attitudes
towards the potential employee.
The concept of employment brand very specifically pointed out by Swystun
(2007) who argued “a brand is a mixture of attributes, tangible and intangible,
symbolized in a trademark, which if managed properly, creates value and influence”
(p.14). In this definition, researcher agrees that branding is essential to create
organization’s image positively. Similar to the concept of ‘branding’ in marketing,
‘employment brand’ also provides the uniqueness of the product and gaining distinct
employment experience (Edwards, 2010). It is assumed that when organizations
clearly interpret the employment experience, it helps in creation of brand perception
towards the potential recruits and influences them to apply for job (Edwards, 2010).
The employment experience is organization specific; in this regard Backhaus and
Tikoo (2004) argue, employer branding “suggests differentiation of a firm’s
characteristics as an employer from those of its competitors, the employment brand
highlights the unique aspects of the firm’s employment offerings or environment” (p.
502). In this regard, American Marketing Association (1960) said that a ‘brand’ is a
means to differentiate from the competitors, and it gives competitive advantage to
the organization (van Reil & Balmer, 1997). The image of employer brand indicates
the nature of employment, career opportunity, challenges and its unique features,
which distinguish it from competitors (Arachchige & Robertson, 2011).
The term ‘employer branding’ does not refer the short-term recruitment strategy
but is focused on long term strategy, having innovation (Srivastava & Bhatnagpur,
2010) and awareness and creation of perception of different stakeholders regarding
the firm (Sullivan, 2004). Brands create a psychological impact on people as they
tend to associate the brands mentally as well as emotionally (Brown, 1992; Kapferer,
2004). The employer branding concept is mostly applicable in high value-added
business or services where salary is high and number of working employees is few
(Ambler & Barrow, 1996). Backhaus and Tikoo have (2004) defined employer
branding as “the process of building an identifiable and unique employer identity”.
Ambler & Barrow (1996) proposed three dimensions of employer branding
namely: functional, economical and psychological. Functional branding is defined as
development or engagement of some useful activity (Ambler & barrow, 1996,
p.187). Economic benefit is the sum up as ‘material or monetary reward’ which
signifies not only the price but also the additional things involved in the product.
Psychological benefits are intangible in nature and constitute of feelings such as
belongingness, purpose and satisfaction (Ambler & Barrow, 1996).

3.1 Role/ Significance of Employer Branding in Recruitment

Employer branding is a sum total of psychological, economic, and functional
benefits provided by employment and identified by the employer (Ambler & Barrow,
1996; Lievens & Highhouse, 2003). Employer branding creates a psychological
impact on prospective employee as an ideal place to work (Lloyd, 2002). Job-seekers
perception towards a brand is closely related to the company’s reputation (Micik &
92 AIMS International Journal of Management 14(2)

Micudova, 2018), which most likely is the reflection of brand (Fombrun, 1996).
Several studies have also suggested that there is a relationship between image of the
organization and attraction of quality job applicants (Fombrun, 1996; Cable &
Turban, 2001). Many researches support the findings that reputation and brand image
of organization play a significant role in recruitment process (Berthon et al, 2005;
Lievens et al., 2007; Xie, Bagozzi & Meland, 2015).
Employer branding becomes an ‘umbrella programme’ to give a definite structure
to the previous HR policies and practices (Edwards, 2010). Employer branding also
targets current and potential employees.

3.2 Value Proposition of Employer Branding

Value proposition is considered as a ‘backbone of employer branding’, as it develops
a clear vision about organization and also significantly helps in employee attraction
and retention (Sengupta et al., 2015). In order to attract a potential candidate, , after
designing external marketing strategy, a successful employer branding strategy first
identifies and develops their value propositions consisting of a combination of
several types of offerings (Backhaus & Tikoo, 2004).
The Value proposition of employer branding is measured through five criteria
namely; social value, interest value, economic value, development value and
application value (Sivertzen, 2013). Social value can be defined as “It calculates the
mark of appeal of an organization or a company providing a work environment with
good and welcoming team spirit and decent respectable relations among co-workers
(Hadi & Ahmad, 2018). Social value is the sum of the attributes such as fun,
happiness, stress upon good employer and employee relationships as well as
collegial relation (Berthon et al., 2005). Social value at work is an emotional
attachment (Dabirian et al., 2016) and feeling of belongingness from their working
place (Sivertzen, 2013). Interest value is related to innovation and development of
interest in performing the task to meet the challenges (Sivertzen, 2013) and “It
assesses the degree of appeal of an employer who is responsible for providing a work
situation with innovation and creativeness opportunities” (Hadi & Ahmad, 2018).
Interest value is the extent to which job-seekers are attracted towards the employer
for novel work practices, implication of creativity and innovation in product and
services (Berthon et al., 2005). “Economic value estimates the amount of attraction
of an employer providing a worthy remuneration and profits” (Hadi & Ahmad,
2018). Economic value accounts for all types of monetary benefits offer by the firm
to their employees which includes salary, compensation package, job security and
scope for promotion (Berthon et al., 2005; Dabirian, 2016). Development value
refers to the acknowledgement of employees’ performance and provides benefits for
professional development and future career growth (Dabirian, 2016). It assesses the
extent to which an individual is attracted towards the employer that provides
confidence, recognition, and career-enhancement. Hadi and Ahmad (2018) defined
development value as “It is an attribute that estimates the degree of attractiveness of
an employer providing career development”. Further, their study found that there is a
positive relation between development value with employee retention, but not in case
of application value, interest value, and work life balance.
Finally, application value signifies the relevance of work with the knowledge and
skills. It makes the work meaningful and determines the degree of attraction towards
Kumari, Dutta, Bhagat 93

the establishment providing a platform to apply the knowledge (Hadi and Ahmad,
2018). It is an extent to which job-seekers are attracted towards the employer and
their learning experience for the benefits of society (Berthon et al., 2005).
Apart from this five-value proposition, Dabirian et al. (2016) added two value
propositions which are management value and work life balance. Management value
focuses on employer-employee relations not with the company. A proper work life
balance facilitates the people to work in the harmony at work place and also maintain
personal life with friends, parents or club members without any conflict (Hadi &
Ahmad, 2018). Other important values added in employer branding are diversity
value and psychological value (Hadi & Ahmad, 2018).

4. Research Methodology
The sample size of the study was 205 consisting of job seekers- fresh graduates or
final year students and employees who are actively searching for the better
opportunities outside the organization. Hence judgmental sampling has been used in
collecting the responses. The students who were selected from the final year of MBA
were less than 5 months away from completing their post-graduate degrees and
entering in the organization. On the other hand, employees were both full-time and
part time and their education level ranges from graduate, post-graduate to M.Phil. /
Ph.D. In addition, they were working for the past six months to several years as a
part-time or full-time in the organization.
Before the selection of the population of the study and sample size determination,
a total of three focus groups discussion were conducted. The participants were final-
year MBA students of different colleges and full time and part-time employees. The
purpose of the focus group discussion was to identify the items for employer
branding dimensions of the attractiveness construct. For this study, researcher
outlined twenty-four items, however, after focus-group discussion there were total
fourteen value propositions were identified. These items were rated from ‘never’
(least preferred) to ‘always’ (most preferred). For this research, survey method is
opted and questionnaire is designed to collect demographic details of the respondents
and their opinion related to employee attraction and employer branding. A total of
twenty-three questions were designed in which, part-A of the questionnaire contained
their name, gender, education level, experience, about their interest and choices.
Part-B of the questions was designed in a five-point Likert scale (from 1-Never to 5-
Always) to measure the outcome value. While designing the questionnaire the
various variables taken in consideration are interest value, social value, application
value, development value and economic value. The statistical analysis was done
using SPSS 20.0.

5. Data Analysis and Results

• The sample size of employees was 205, with a mean age of 26.01. The
demographic statics show that 61% males and 39% females participated in this
survey. The details of age group are: 20-25 was 52.7%, 25-30 was 11.7%, 30-35
was 24.9% and above 35 was 10.7%. In this survey the following categories were
noted: 42.4% final year students, 5.9% pass-out students, 47.8% full-time
employee and 3.9% part-time employee. The educational qualifications of
94 AIMS International Journal of Management 14(2)

respondents as observed are: 33.7% were graduate, 60.5% were post-graduate,

4.9% were M.Phil./PhD and 1% were others. The work experience of respondents
shows that 54.1% respondents had 1-5 years of experience, 23.9% of participants
had 3-6 years, 7.3% of participants had 6-9 years of experience and 14.6% had
above 9 years of work experience.
• In this survey, a question was asked to working employee that are they working in
their dream company. The response was (exclamatory), 78% said ‘No’, whereas
23.4% said ‘yes’ and 38.5% of the participants haven’t decided yet. Among these
responses, a majority of respondents were not working in their ideal company.
This response left the area of further research that why they are not in their dream
organization.
• 35.6% respondent said they usually attracted to apply for a job due to company’s
brand position, 20% people influenced due to the others opinion, 15.1% due to
company’s rating given by the agency, 13.7% due to company’s vision and
mission and significantly 15.6% said that other factors about the company attract
them to apply for a job.

word-of-
others
mouth
15%
20%

company's
rating
15%
company's
brand
position company's
36% vision &
mission
14%

Figure 1 Major Factors Influencing the Job-Seeker to Apply

• While searching and applying for a job 63.9% respondent looked for career
growth opportunity, 19.5% working environment, 7.3% company’s offerings,
6.3% employer-employee relations and 2.9% saw other factors. It could be said
that now-a-days career growth opportunity in a company plays a crucial role in
applying for a job.

5.1 Exploratory Factor Analysis (EFA)

Exploratory factor analysis (EFA) is a statistical method used to find the underlying
structure of a relatively large set of variables. Before extraction of the construct,
there should be some test was performed to measure the adequacy of the sample and
the suitability of data for factor analysis (Burton & Mazerolle, 2011). Cronbach
alpha for the items was 0.786. The adequacy of sample size of the data was checked
by KMO and Bartlett’s Test which suggests minimum KMO value should be 0.5,
Kumari, Dutta, Bhagat 95

0.50-0.59 is miserable, 0.60-0.69 is mediocre, 0.70-0.79 is middling, 0.80-0.89 is

meritorious and 0.90 to 1.00 marvelous (Kaiser, 1974; Cerny & Kaiser, 1977) and
the values between 0.5 and 0.7 are rated as average, 0.7 and 0.8 are good, 0.8 and 0.9
are very good and the values 0.9 and above are excellent as recommended by Hadi et
al. 2016. Our result of KMO is 0.834, which indicates that the data is fit for factor
analysis. Bartlett’s test of Sphericity results chi-square output checks the suitability
(Tabachnick & Fidell, 2001) for factor analysis and it must be significant (p<0.5).

Table 1 KMO & Bartlett’s Test of Sphericity

KMO and Bartlett’s Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy. 0.834
Bartlett's Test of Sphericity Approx. Chi-Square 805.777
Df 91
Sig. .000

The data collected through questionnaire was processed in SPSS 20. Principal
Component Analysis (PCA) method used along with Direct Oblimin rotation
extracted all the factors having Eigen value greater than one (>1). The results were
reported in Table 2, in form of pattern matrix which summarizes the component
value greater than 0.4. One of the scale items about the opportunity to learn new
things, had the correlated value below 0.4, hence, has been dropped to reduce the
error.

5.2 Discussion on Finding

In this study, the first value proposition i.e. Social value assesses the most important
variable related to the working environment such as enjoyment, relation with
employer and colleague. ‘Economic value’ offers the potential employee to attract.
According to the study, good salary, promotional opportunities and a good
compensation package are important for an applicant. ‘Interest value’ assesses the
extent to which the potential employee attracted to the components like enjoyment at
work, appreciation, significance of his work. ‘Development value’ offers to the
potential employee career-enhancing opportunity, satisfaction of his work and
appreciation. Lastly, ‘Application value’ offers to learn a new thing, feeling of
belongingness with the working environment.
For the study, literature suggests five-value proposition of employer branding
(Sivertzen, 2013; Berthon et al., 2005) however, this structure shows the three
dimensions of employer branding (psychological, functional & operational) which
was proposed by Ambler & Barrow (1996). Further, after analyzing the data, our
study suggests three factors (or value propositions) of employer branding. These are
categorized as social and interest value representing the ‘psychological benefits’
(Ambler & Barrow, 1996), development and application value representing the
‘functional benefits’ (Ambler & Barrow, 1996) and economic representing the
‘operational benefits (Ambler & Barrow, 1996).
96 AIMS International Journal of Management 14(2)

Table 2 Pattern Matrix

Q.
Items on Questionnaire Component
No.
1 2 3
A. Social & interest
21. 0.77
Do you feel a sense of belongingness in the firm?
22. 0.76
Do you get enough support from your boss?
23. 0.72
Do you get enough support from colleagues at work place?
20. 0.72
Are you satisfied at your workplace?
19. 0.58
Do you enjoy doing your work
B. Economic Value
0.69
11. Are non-monetary benefits most important
0.58
10. Are monetary benefits (salary+ incentives) are most important
0.43
12. Do you look for Career enhancing opportunities?
C. Application & Development Values
15. Do you look for getting new things to work? 0.82
14. Do you look for appreciation of new ideas? 0.77
13. Are Social security benefits being most important? 0.69
16. Do you look for fair decision-making policy? 0.50
17. Do you look for opportunities to Participate in decision-making 0.43
process in the organization?

For a job seeker all these elements play a significant role. There is no consistent
strategy which can help the recruiters to attract the potential candidates. Social media
is gaining significance and companies are using this platform but still one cannot
predict a single way out to attract talent. One need to take into consideration every
aspect psychological factor like satisfaction at workplace, economic benefits, growth
opportunity etc. as each of them plays a pivotal role. People also want social security
at work like insurance schemes, provident fund and gratuity which gives them
protection from uncertainties. They want to have participative management style; as
none of us want to just follow the things but when we are involved, we feel a sense
of responsibility. People want to be more versatile as monotonous work is not
preferred anymore. Hence all these aspects are important and must be taken care to
create perfect employer brand. Social media platforms are being used rampantly by
many companies. Recruiter engagement through social media is still an area that
needs to be explored and there is need to explore strategies that are going to work
efficiently in this direction. Practitioners need to incorporate all the factors like
psychological, economic and functional benefit in creating employer branding.

6. Limitation of Study and Scope for Future Research

One of the major limitations of our study is the number of respondents and the
geographical reach. The sample size is acceptable but the number of focused group
interview need to be increased. Respondents need to be selected from different
geographical region to get a better concrete and diverse opinion. A further study is
needed to be conducted to explore the interrelationship between social platform and
creating employer brand and there is a need to work on developing strategy that can
help to attract best talent.
Kumari, Dutta, Bhagat 97

7. Conclusion
Organization’s image perception and attractiveness do influence the job seekers to
apply for the job. Employer branding is a sum of psychological, economic and
functional benefits provided by employment and identified by the employer. It has a
psychological impact on prospective employee. Value propositions are considered as
a backbone of employer branding as it develops a clear vision about the organization
and significantly helps in employee attraction and retention. This research paper
explored the importance of employer branding and its impact on recruitment process.
From this study, our findings suggest that social value is a very crucial value for
employees or hiring a new employee in the organization. It is noticeable that job-
seekers are giving more preference in the social values. While searching a job they
give more preference to the employer-employee relations, good relations with
colleague so that they can feel the sense of belongingness with the organization.
Findings of the study will help the recruiters to adapt to better measures.

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0051

About our Authors

Puja Kumari is currently pursuing her doctoral research on e-recruitment trends in

India. She has contributed several papers in reputed national and international
management journals. She has also presented papers in national level conferences.
She has attended several seminars, workshops and conferences related to Human
resource issues in management, entrepreneurship, research methodology

Mili Dutta possesses 13 years of experience in academics and research. She is

currently working as Assistant Professor, Department of Management, Birla Institute
of Technology, Mesra, off-campus Lalpur, Ranchi. Her areas of interest include HR
issues. She has contributed several papers in national and international management
journals. She has also presented papers in national and international conferences. As
a part of pursuit for academic excellence, she has attended several seminars,
workshops and conferences related to strategic management, marketing research and
teaching methodology.

Manju Bhagat is professor of Management at Birla Institute of Technology, Mesra.

She has over 30 years of experience in academics and research. Apart from her
doctoral research, she has contributed to research through several research papers
and conference proceedings. She has guided several doctoral research students also.
100 AIMS International Journal of Management 14(2)

She has organized and mentored several seminars, workshops, conferences and
management programs. Her areas of interest include labour economics and human
relations, organization Behavior and industrial relation issues. She has also served as
Head of the Department of Management.

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