January 23, 2006
Help wanted, help found | JobsInTheUS agrees to a buyout from a regional newspaper company to finance further growth of its employment websites
By Richard Smart
When it comes to job listings, momentum continues to pull customers away from print classifieds and toward online recruitment websites. Online job sites now capture roughly a quarter of the $5 billion spent on recruitment advertisements each year according to Bruce Murray, CEO of Corzen Inc., a market research firm in New York that specializes in online media. And online classifieds companies' revenues have been rising about 40% a year since 2001, Murray said. That's in sharp contrast to the 10% growth newspapers are seeing in their job classifieds ad revenue.
With the tide running that strongly, it's no surprise that Trenton, N.J.-based The Journal Register Co. ˆ which publishes 27 daily newspapers with a combined circulation of 650,000, and 338 non-daily publications with a circulation of five million ˆ looked to a smaller, fast-growing online recruitment company to shore up its own classified ad business. In December, JRC purchased Westbrook-based JobsInTheUS, which operates five online job sites, for an undisclosed sum.
What is surprising, though, is that for all the trends indicating that newspapers should be the ones looking for online partners, it was actually JobsInTheUS that approached JRC about an acquisition, said JobsInTheUS CEO Matt Hoffner. JobsInTheUS, which was founded in 1999, reached $3 million in revenues last year and had been adding about one new statewide job site a year. But those revenues still didn't give the company the resources to grow at the pace Hoffner and his partners thought necessary, he said. So last May, JobsInTheUS hired Colorado-based investment banking firm Daniel & Associates to begin looking for a partner with deeper pockets. "We realized that if we were going to be successful we were going to need to step up the pace," said Hoffner.
The deal could help JobsInTheUS realize its goal of adding to the list of states it serves at a quicker pace. And with the addition of JobsInTheUS's websites, JRC could capitalize on the rapidly expanding online classifieds business, said Jean Clifton, JRC's president and chief operating officer. The pairing makes sense, Clifton said, because JobsInTheUS has a regional focus similar to the periodicals that JRC publishes, which range from the New Haven Register, in New Haven, Conn., with a daily circulation of more than 94,000, to the Coventry Courier, a weekly in Rhode Island with a circulation of 961.
Unlike well-known online employment websites such as Monster.com, which concentrate on large metropolitan areas, JobsInTheUS' approach is more regionally focused. Hoping to tap job seekers and employers looking for a match within their regions, JobsInTheUS gives its websites a statewide focus. Likewise, the sites target smaller businesses outside metropolitan areas, and Hoffner said companies with fewer than 50 employees make up the bulk of their clients. "The Internet does a great service of trying to match people on a national basis, but we also feel it could work on a local level," said Hoffner.
Now, the goal of the acquisition is to develop new employment websites in the regions where JRC is already publishing newspapers. Each region's website would follow the same naming convention of JobsInTheUS' current sites ˆ for example, JobsInRI and JobsinME ˆ but clients of either company would be able to purchase recruitment advertising packages that also use JRC's print sources in a given region.
Physical presence, unlimited space
The two companies began discussing a potential merger in August, and met for the first time in September. After JRC had an opportunity to review all of JobsInTheUS' records, a deal was struck on December 5. "The more we got to know each other, the more we liked each other," said Hoffner.
But JobsInTheUS and JRC are not the first newspaper and online companies to team up. Knight Ridder, Gannett and Tribune share ownership of CareerBuilder.com, one of the fastest growing online classifieds companies in the nation, according to Murray. The need for newspapers to partner with employment websites has to do with efficiency in terms of recruiting, he added: The Internet reaches a broader range of potential employees, is typically less expensive than print advertisements and has the benefit of unlimited space for an advertisement.
That's not to say that print advertisement is obsolete, or will be any time in the foreseeable future. Peter Weddle, CEO of Weddle's, a Stamford, Conn.-based publishing and consulting firm specializing in recruitment, said research indicates the most effective recruitment method relies on both print and online advertisements. And in fact, since JRC's acquisition of JobsInTheUS, most of the planning has centered on how to develop a relationship between the two companies' products, said Hoffner.
One of the integral problems with print, said Weddle, is the issue of space. It's too expensive to print enough information about a position to entice job candidates into applying, an issue that doesn't exist for Internet advertisements. However, most potential employees still use newspapers as a means of searching for a new job. To address that issue, JRC and JobsInTheUS plan to share ads between JRC newspapers and JobsInTheUS' websites. That system would allow clients to place ads in the newspaper that refer job seekers to detailed descriptions online. "The beauty of our business is that in light of the fact that we are local community papers, we have local proprietary content," said Clifton, noting that the community newspapers could act as gateways to the websites.
Adopting JobsInTheUS' branding could help JRC deal with another problem facing newspapers, said Weddle. Most newspapers' online job listings don't fare well as standalone employment sites, he said, since the latter serve more as a career-planning center ˆ complete with job planning features and community bulletin boards ˆ and less like a traditional classifieds section. "You're starting to see a shift in content from 'How do I write a resume?' to 'How do I plan out a career?'" Weddle said.
Services in this vein offered by JobsInTheUS have proven very popular, said Hoffner. As an example, he cited the copmany's Career Agent e-mail service, which allows users to specify the types of jobs and geographical locations desired. When a new job is posted matching those specifications, the user receives an e-mail that day. The service sent out more than one million e-mails in December, said Hoffner.
Cross selling without crossed wires
Currently, the two companies are planning to test this potentially symbiotic relationship in Rhode Island ˆ where JRC has 19 publications and JobsInTheUS operates an existing employment site.
But that will take some work. The companies need to refine their advertising packages, train their sales staffs to be proficient in selling both online and print recruitment ads, and create a technology network that allows for each partner to be kept abreast of the other's sales. Hoffner said the companies hope to have the Rhode Island integration effective by the end of the first quarter.
After Rhode Island, Hoffner said JobsInTheUS will create JobsInCT and begin the same integration process in Connecticut, where JRC publishes 69 different periodicals. From there, JobsInTheUS will continue to target areas where JRC publishes several newspaper titles, such as New York's Hudson Valley. But beyond that, JobsInTheUS may also move into new regions where JRC doesn't publish any newspapers, Hoffner said. He hopes to add more than one state a year.
Even though JobsInTheUS will be moving into markets further away from Maine, Clifton said JRC doesn't plan on relocating the company or its 27-person staff from its Westbrook headquarters. "We don't want to force them to move out of Maine, and in fact we are going to expand the presence of JobsInTheUS [in Westbrook]," Clifton said.
That growth has already begun. Hoffner said he currently has 18 to 20 jobs posted on the JobsInTheUS website, calling for people in sales, IT and marketing. In addition he has begun exploring the idea of purchasing more space near JobsInTheUS' current headquarters.
With the staff training, technical issues and legal procedures involved in being acquired by a publicly traded company, like JRC there are plenty of hurdles remaining in the merger between the two companies. However, Hoffner is confident the deal has solved the company's biggest existing problem, and positioned it well to make the necessary changes. "The key for us is that we now have a corporate parent that has the financial resources to help us grow faster," Hoffner said.
With the tide running that strongly, it's no surprise that Trenton, N.J.-based The Journal Register Co. ˆ which publishes 27 daily newspapers with a combined circulation of 650,000, and 338 non-daily publications with a circulation of five million ˆ looked to a smaller, fast-growing online recruitment company to shore up its own classified ad business. In December, JRC purchased Westbrook-based JobsInTheUS, which operates five online job sites, for an undisclosed sum.
What is surprising, though, is that for all the trends indicating that newspapers should be the ones looking for online partners, it was actually JobsInTheUS that approached JRC about an acquisition, said JobsInTheUS CEO Matt Hoffner. JobsInTheUS, which was founded in 1999, reached $3 million in revenues last year and had been adding about one new statewide job site a year. But those revenues still didn't give the company the resources to grow at the pace Hoffner and his partners thought necessary, he said. So last May, JobsInTheUS hired Colorado-based investment banking firm Daniel & Associates to begin looking for a partner with deeper pockets. "We realized that if we were going to be successful we were going to need to step up the pace," said Hoffner.
The deal could help JobsInTheUS realize its goal of adding to the list of states it serves at a quicker pace. And with the addition of JobsInTheUS's websites, JRC could capitalize on the rapidly expanding online classifieds business, said Jean Clifton, JRC's president and chief operating officer. The pairing makes sense, Clifton said, because JobsInTheUS has a regional focus similar to the periodicals that JRC publishes, which range from the New Haven Register, in New Haven, Conn., with a daily circulation of more than 94,000, to the Coventry Courier, a weekly in Rhode Island with a circulation of 961.
Unlike well-known online employment websites such as Monster.com, which concentrate on large metropolitan areas, JobsInTheUS' approach is more regionally focused. Hoping to tap job seekers and employers looking for a match within their regions, JobsInTheUS gives its websites a statewide focus. Likewise, the sites target smaller businesses outside metropolitan areas, and Hoffner said companies with fewer than 50 employees make up the bulk of their clients. "The Internet does a great service of trying to match people on a national basis, but we also feel it could work on a local level," said Hoffner.
Now, the goal of the acquisition is to develop new employment websites in the regions where JRC is already publishing newspapers. Each region's website would follow the same naming convention of JobsInTheUS' current sites ˆ for example, JobsInRI and JobsinME ˆ but clients of either company would be able to purchase recruitment advertising packages that also use JRC's print sources in a given region.
Physical presence, unlimited space
The two companies began discussing a potential merger in August, and met for the first time in September. After JRC had an opportunity to review all of JobsInTheUS' records, a deal was struck on December 5. "The more we got to know each other, the more we liked each other," said Hoffner.
But JobsInTheUS and JRC are not the first newspaper and online companies to team up. Knight Ridder, Gannett and Tribune share ownership of CareerBuilder.com, one of the fastest growing online classifieds companies in the nation, according to Murray. The need for newspapers to partner with employment websites has to do with efficiency in terms of recruiting, he added: The Internet reaches a broader range of potential employees, is typically less expensive than print advertisements and has the benefit of unlimited space for an advertisement.
That's not to say that print advertisement is obsolete, or will be any time in the foreseeable future. Peter Weddle, CEO of Weddle's, a Stamford, Conn.-based publishing and consulting firm specializing in recruitment, said research indicates the most effective recruitment method relies on both print and online advertisements. And in fact, since JRC's acquisition of JobsInTheUS, most of the planning has centered on how to develop a relationship between the two companies' products, said Hoffner.
One of the integral problems with print, said Weddle, is the issue of space. It's too expensive to print enough information about a position to entice job candidates into applying, an issue that doesn't exist for Internet advertisements. However, most potential employees still use newspapers as a means of searching for a new job. To address that issue, JRC and JobsInTheUS plan to share ads between JRC newspapers and JobsInTheUS' websites. That system would allow clients to place ads in the newspaper that refer job seekers to detailed descriptions online. "The beauty of our business is that in light of the fact that we are local community papers, we have local proprietary content," said Clifton, noting that the community newspapers could act as gateways to the websites.
Adopting JobsInTheUS' branding could help JRC deal with another problem facing newspapers, said Weddle. Most newspapers' online job listings don't fare well as standalone employment sites, he said, since the latter serve more as a career-planning center ˆ complete with job planning features and community bulletin boards ˆ and less like a traditional classifieds section. "You're starting to see a shift in content from 'How do I write a resume?' to 'How do I plan out a career?'" Weddle said.
Services in this vein offered by JobsInTheUS have proven very popular, said Hoffner. As an example, he cited the copmany's Career Agent e-mail service, which allows users to specify the types of jobs and geographical locations desired. When a new job is posted matching those specifications, the user receives an e-mail that day. The service sent out more than one million e-mails in December, said Hoffner.
Cross selling without crossed wires
Currently, the two companies are planning to test this potentially symbiotic relationship in Rhode Island ˆ where JRC has 19 publications and JobsInTheUS operates an existing employment site.
But that will take some work. The companies need to refine their advertising packages, train their sales staffs to be proficient in selling both online and print recruitment ads, and create a technology network that allows for each partner to be kept abreast of the other's sales. Hoffner said the companies hope to have the Rhode Island integration effective by the end of the first quarter.
After Rhode Island, Hoffner said JobsInTheUS will create JobsInCT and begin the same integration process in Connecticut, where JRC publishes 69 different periodicals. From there, JobsInTheUS will continue to target areas where JRC publishes several newspaper titles, such as New York's Hudson Valley. But beyond that, JobsInTheUS may also move into new regions where JRC doesn't publish any newspapers, Hoffner said. He hopes to add more than one state a year.
Even though JobsInTheUS will be moving into markets further away from Maine, Clifton said JRC doesn't plan on relocating the company or its 27-person staff from its Westbrook headquarters. "We don't want to force them to move out of Maine, and in fact we are going to expand the presence of JobsInTheUS [in Westbrook]," Clifton said.
That growth has already begun. Hoffner said he currently has 18 to 20 jobs posted on the JobsInTheUS website, calling for people in sales, IT and marketing. In addition he has begun exploring the idea of purchasing more space near JobsInTheUS' current headquarters.
With the staff training, technical issues and legal procedures involved in being acquired by a publicly traded company, like JRC there are plenty of hurdles remaining in the merger between the two companies. However, Hoffner is confident the deal has solved the company's biggest existing problem, and positioned it well to make the necessary changes. "The key for us is that we now have a corporate parent that has the financial resources to help us grow faster," Hoffner said.
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