Last week, Monster.com announced their intent to acquire Yahoo! HotJobs from Yahoo! for $225 million in cash. As part of this deal, Monster entered into a three year traffic agreement with Yahoo!, the #2 search engine, and will now be the exclusive career site on the Yahoo! home page in US and Canada. Monster also gained the right to negotiate similar traffic deals with Yahoo’s international organizations (such as UK, France, India and Brazil), which was a huge consideration since Monster earns a significant portion of their revenue internationally.
One thing is for sure - the $225 million spend is not justified on a multiple basis of HotJobs revenue. So what made this deal so appealing?
“Well first of all, this was Monster’s way of reclaiming their throne as the #1 job site in North America based on traffic, causing CareerBuilder.com to fall to #2,” says David Brensilber, Senior VP of Business Development for Beyond.com and former VP of Business Affairs for Yahoo! HotJobs. “The deal was never about HotJobs revenue, clients or branding. In fact, it is still yet to be seen if Monster even plans to keep the HotJobs brand. The deal was about aligning their company with Yahoo! and creating a baseline source of traffic similar to other players in the career space, such as CareerBuilder.com who has exclusive traffic deals with MSN and AOL.”
Another huge selling point of the “acquisition” was HotJobs’ newspaper consortium deals, which is an enormous access point for millions of customers across North America. By gaining the opportunity to work with over 600 newspapers, Monster now has the ability to drive “local” traffic to their website and further expand the “local” approach to their business, which they have been struggling to do thus far. In a time when sites like Beyond.com are focused solely on local and niche recruitment, Monster needed to do something drastic to try to keep up
It is also worth mentioning that the HotJobs announcement was a well calculated move by Monster.
“It is certainly no coincidence that the PR regarding the HotJobs “acquisition” was published only one minute after the release of their fourth quarter and full year 2009 financial results,” says Rich Milgram, CEO of Beyond.com. “This was a good move for Monster in an attempt to deflect their 33% decline in revenue in 2009. Monster experienced a tough year and the news of a new acquisition was their way of trying to turn it around."
So what does this deal between Monster and HotJobs mean for their customers? More job seekers will be going to the same site, but the content will likely remain unchanged. With more job seekers and the same job inventory, it can only result in one thing – more job applies, further overwhelming employers who are already inundated with mounds of unqualified applicants. Another source of frustration will likely arise from the overlap in customers and product sales between the two organizations.
As for the career space in general, the consolidation of similar product lines from Monster and HotJobs is great news for Beyond.com, as it creates an opportunity for niche sites to be an even bigger player at the table as employers look to diversify their recruitment ad spend. When you think of the top players in the career space now, HotJobs.com has left a huge void in the top three that Beyond.com is more than willing (and capable) to fill. Monster.com, CareerBuilder.com and Beyond.com…it has a nice ring to it, doesn’t it?
