Grabbing Monster by tail

By MARK STORY

On the rare occasions that Craig Kennedy, recently appointed Asia Pacific president of online recruiter Monster, takes his Triumph Daytona - the Jaguar of bikes - out for a spin on Sydney's highways, the last thing he wants to think about is work.

But that's where he gets his best ideas.

His biggest brainwave has been to perform a triple bypass on Monster's business model. He realised that without the first-mover advantage its parent company, Monster.com, enjoyed when it pioneered online staff recruitment back in 1994, the standard rules for commercial success simply don't apply these days.

Monster is the flagship brand of recruitment firm TMP Worldwide, and Monster Asia Paficic a joint venture between TMP and the Microsoft-related ninemsn.

Monster exists in 21 other countries from England to India, but is a newcomer to transtasman online recruitment and it's not making money here - yet.

But by playing the numbers game, Monster.com has become one of the world's most profitable internet companies, with a 55 per cent market share, profit margins of 27 per cent - and $180 million in profit last year.

Instead of tackling Monster.com head-on, rival US providers are specialising in different sectors, forcing it to follow suit.

But after failing to beat local participants in the tough classified job ads sector, Monster's local arm has accepted a wake-up call, says Kennedy.

Simply making more and more resumes available online - one million across Australasia - is a lousy business model when you're not first in.

What Kennedy gleaned from the leading Australasian online recruiter, the independent Melbourne-based seek.com.au, is that a high-volume resume database is a flaky path to profitability.

His best estimates put rival seek.co.nz's share of all jobs advertised in Australia and New Zealand at 55 per cent, compared with Monster's 15 per cent. But after five years, Seek is only just starting to break even.

Kennedy decided to focus Monster's marketing on attracting quality candidates within three hot industry sectors: healthcare, finance and accounting.

He expects these markets to put the company into break-even territory by 2004; his goal is a 50 per cent share of each sector.

Research led Kennedy to equally important revelations. "Our own surveys proved that Monster's limited success in New Zealand had nothing to do with our offering. It was more about the poor job getting our message across," says Kennedy.

"After the success Monster had in the US, the approach to local markets was decidedly arrogant. It's embarrassing to have taken so long to work this out."

Based on February figures on the number of unique visitors to jobs websites, Kennedy's targets look pretty ambitious. Internet traffic monitor RedSheriff ranks monster.co.nz at fourth (58,489) behind seek.co.nz (131,037), nzjobs.co.nz (90,576) and jobstuff.co.nz (67,316).

By US standards, Monster's total billings in Australia and NZ are paltry.

Based on Kennedy's conservative estimates, Monster Asia Pacific's's total billings this year will be about 10 per cent of the estimated A$75 million ($83.3 million) online recruitment market.

Job advertising comprises the lion's share, A$40 million ($44.4 million), of that revenue. But Kennedy expects applicant tracking and career site hosting, at present accounting for the remainder, to boost online job numbers.

He expects corporations to take more responsibility for the recruitment cycle, from ad jobs through to candidate selection, testing and hiring. The tide's already turning. ANZ's job index found a 10 per cent increase in job adverts between September last year and February. Web crawler Flipdog's count of the top six internet job sites shows that online jobs adverts grew 46 per cent in that time.

With Monster's revenue firmly wired to job ads, the company makes money only when companies advertise vacancies. And with 90 per cent of Monster Asia Pacific's's revenue coming from Australia alone, Kennedy is keen to milk the Kiwi market.

But only two of Monster's 50 Australasian staff are based locally, so he is taking a decidedly remote-control approach.

Kennedy says accounting and finance professionals are a ready audience, because of their growing reliance on web-based tools. In fact, he says their internet use is so well defined that Monster can target certain pages in online news websites heavily patronised by these workers.

"This is such a good audience for us to reach," he says. "If we can't make money here we should pack our bags."

The country's 173,150 health and community service workers represent a huge and largely untapped target market.

With work-based internet access less available to these workers, Kennedy is planning a media schedule that follows their habits.

He attributes the additional 12,000 healthcare resumes over the past two months to targeted print media and online advertising.

"Research indicates that we're more likely to reach nurses by [tabloid magazine] Woman's Day than a broadsheet," he says.

"In addition to targeting the obvious health-related publications, we're also buying the backs of ATM receipts around hospitals and vending machines inside those locations."

Kennedy was the head of online banking operations for Europe-based financial services business ING when shoulder-tapped to run Monster's local operation.

It followed last year's decision by TMP Worldwide to hive off its executive search business from the Monster.com advertising job board.

A terminally ill father, and the pending arrival of his first-born, a boy, convinced Kennedy that running Monster was a more attractive proposition than a pending secondment to Netherlands with ING.

But what sealed his commitment was a meeting with Monster.com's New York-based founder, Geoff Taylor, last August.

Taylor convinced Kennedy that the internet banking disciplines he could bring to Australasia's immature online recruitment sector would reap enormous untapped potential.

"I'm trying to bring a disciplined focus to this business," says Kennedy.

"Future spoils will go to online recruiters demonstrating competencies within each industry sector.

"The only measure of success for a job board is your ability to fill a vacancy from candidates attracted to our site. This is an area in which Monster in Australasia has the most room for improvement."

Craig Kennedy's CV

* Title: President of Monster Asia Pacific

* Age: 34

* Place of birth: Maitland, New South Wales, Australia

* Qualifications: Incomplete commerce degree Newcastle University; master of business administration, Heriot Watt University.

* Major posts: Head of direct banking, ING Direct; national manager electronic banking, St George Bank, Australia.

* Home situation: Married, one son.

* Personal interests: Motor sports, cricket, rugby league.