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An Exploratory Study of the Role of Employer Branding in Employee

Attraction and Retention

1. What is employer branding?

The employees’ role in creating value through delivering experiences to the customer calls

for research on how to attract the right employees, motivate and retain them to deliver a

better performance (Gounaris, 2006; Ahmed & Rafiq, 2003; Ahmed et al., 2003; Rafiq &

Ahmed, 1993). Employer branding is an effective marketing strategy which aims to establish

the identity of the firm as a unique and desirable place to work, with its objectives toward

attracting, motivating and retaining the best employees (Backhaus & Tikoo 2004).

2. How does employer branding work? Employer branding follows the traditional

branding strategy to attract and retain the best employees

Employer branding is the application of branding principles to employees (Backhaus & Tikoo,

2004). Within the employer branding paradigm, the experiences of employees which relate to

the company appear to be the core products whose quality is largely shaped by the employer

(Moroko & Uncles 2008; Ambler & Barrow, 1996).

Employer branding follows the traditional branding strategy to attract and retain the

employees. Firstly, employers build the brand image by firstly offering tangible job benefits,

or functional beneftis which can be observed, such as salary, position and company location,

and secondly offering intangible job benefits, or symbolic benefits which cannot be observed

directly, such as job promotion opportunities, friendly working environment and

organisational culture (Burmann & Zeplin, 2005). Symbolic benefits can also be explained as

employees’ perceptions about the company’s prestige, and the social identity job seekers

believe they would gain or enjoy if they work for the company. It is argued that when the

symbolic attributes of the brand image resonates with the job seekers’ perception towards

their self-identity, the possibility that the job seeker will choose the company is high. Also

resonating with the brand image is argued as a start point to develop and enhance the

intensity of the relationship between the job seeker and company in the later stages (Wilden

et al., 2010) (See Appendix A: The role of branding with customers and employees).

Secondly, a psychological contract is the subjective beliefs of the exchange agreement

between individual employees and their employer (Backhause & Tikoo, 2004). According to

this, when the agreed promises, such as the agreed salary, promised benefits are perceived to

be true, individual employees’ subjective beliefs toward the company is that they consider the

company as trustworthy. In exchange, employees will start to build the psychological contract

with the company. The extent of employee’s perceptions of the psychological contract is

argued to influence the employees’ motivation, trust, performance, commitment and

satisfaction (Mangold & Miles, 2007). Furthermore, a long and stable psychological

relationship with the company will positively impact employees’ job retention decisions.

Employees tend to stay longer and be loyal to such companies (Wilden et al., 2010).

Thirdly, consistently delivering the promised benefits to extend the psychological contract

encourages employees to commit to the employer brand. Brand commitment is the extending

of employees’ psychological contract to the brand which involves employees’ understanding

and identification with the organisation value (Burmann & Zeplin, 2004; Heskett et al., 2003).

Employees who are commit to the employer brand will not leave the company even when the

working situation allows them to consider other employers (Backhaus & Tikoo 2004). The

other benefit of employer brand commitment is employees are willing to exert extra effort to

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help company achieve their goals. O’Reilly and Chatman (1986) explain that the commitment

related behaviour includes employees’ high motivation for extending effort beyond the job

requirements and consideration of company’s welfare (O’Reilly & Chatman 1986). As such,

not only employees’ intention to leave can be reduced, they will be inspired to engage with

their job and contribute extra efforts (See Appendix B: How the characters of branding

influence customer and employees’ behaviour).

3. Employer branding implementation: identifying the research gap and presenting the

research focuses

Implementing the employer branding strategy in employee attraction is widely researched in

both literature and practice (Knox and Freeman, 2010). Specifically, current research shows

that job applicants make their choices by comparing their needs with employer branding’s

attributes. The match between the employer brandings’ attributes and individuals’ personal

needs and expectations motivates job seekers to make their decisions (Lievens, 2007; Lievens

& Highhouse, 2003; Haslam et al., 2000).

Noticeable, the current research results largely focuses on explaining job seekers’ choices

within the marketing paradigm. However as employer branding adapts the principles from

branding theory and applies them to the management of company’s human resources, as such,

employer branding is a cross-functional management approach which encompasses HR

(Martin et at., 2011; Maxwell & Knox 2009; Hulberg, 2006; Burmann & Zeplin 2004).

Therefore, the need to understand the employer branding’s role in employee recruitment

within the HR paradigm is highlighted. Hence the first research focus is to further explore the

employer branding implementation in employee recruitment by aligning theories from both

marketing and HR.

Research focus 1: Further exploring the employer branding framework in employee

recruitment.

The definition of the employer branding indicates that employer branding implementation

involves not only promoting externally to attract job applicants, it is also essential to consider

promoting internally to motivate and retain the hired employees (Lievens 2007). However,

previous employer branding studies largely focuses on the application of the strategy in

employee recruitment, leaving the research on employee retention underexplored. Wilden et

al. (2010) highlights the needs for focusing on the role of employer branding in employee

retention. They indicate that ‘further research should therefore explore the role of the

employer brand in employee retention and its possible implications for customer attraction,

satisfaction, and retention’ (Wilden et al. 2010). Therefore, the second research focus is

exploring and understanding the application of employer branding in employee retention.

Research focus 2: Exploring the employer branding application in employee retention

China is currently experiencing a huge talents shortage and low employee engagement. The

country is reporting an increasing in talent shortage currently; with 35% of the surveyed

employers indicate they are experiencing talent shortage (ManpowerGroup, 2013).

Furthermore, Gallup (2013)’s survey reveals that only 6% of existing employees are engaged

in their work (lowest in the world), 68% of them are not engaged and 26% are actively

disengaged with their companies (Gallup, 2013). Therefore, the need for Chinese companies

to employ an effectively strategy to attract the talents to fill the jobs and to improve employee

work satisfaction and engagement for higher performance and lower turnover rate is urgent.

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However, the existing studies largely focused on the employer branding application in the

context of western countries (Knox and Freeman, 2010; Maxwell and Knox, 2010; Wilden,

2010; DelVecchio et al. 2007; Berthon et al. 2005; Lievens and Highhouse, 2003; Lievens et

al. 2003). As an Asian country, China has her own unique culture system, therefore the

application of the employer branding within Chinese companies is predicted differently from

the application within the western countries. As such, the need to explore the employer

branding implementation in Asian countries is highlighted. In summary, the third research

focus is exploring the employer branding implementation within Chinese companies.

Research focus3: Understanding the employer branding framework within Chinese

companies.

4. Research design

4.1 Research design

Four research steps are designed to further explore the employer branding implementation

and bridge the research gaps.

Stage 1: Identifying what is employer branding, what role does employer branding play in

attracting and retaining employees and what are the benefits of applying the employer

branding strategy? A conceptual framework which addresses these issues will be built in the

stage one.

Stage 2: Identifying what have attracted the job seekers to work for the company in China.

The findings will help to elaborate and develop the finished conceptual framework in stage 1.

Stage 3: Identifying what have motivated the existing employees to stay in their companies.

The findings will help to extend the conceptual framework in stage 2.

Stage 4: Research findings will be further discussed to identify the factors influence Chinese

employees’ job decisions. The discussion will focus on the culture and social influences.

Findings will also elaborate and extend the conceptual framework in the stage 3.

4.2 Research methods

Previous employer branding research focuses on the employees’ behaviour at an

institutionalised level rather than focusing on individual employees. However, as employees

are coming from different social backgrounds, as such, are uniquely individual. Their

perceptions towards employer brandings are varied. Therefore the need to focus on individual

employees’ experiences is well acknowledged (Lievens, 2007; Moroko & Uncles, 2008;

Maxwell & Knox, 2009; Vallaster & de Chernatony 2010; Wilden et al., 2010).

This research would not ignore the differences between each individual employee. Rather, the

study aims at describing, explaining and understanding the experiences of employees in a

social, contextual and personal way. The study employs an interpretive approach with

understanding rather than quantifying as its goal. The lack of research on employer branding

also indicates that the current study is exploratory in nature.

Twelve in-depth interviews have been carried out so far. Participants include employees from

different positions at different companies, ranging from the founder of the company, CEO,

department manager, line manager to staff members. Themes are expecting to emerge from

thematic analysis results. Also, a case study has been carried out in order to gain a holistic

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view of how employer branding strategy implements at different levels within the same

company. Interview has been conducted with the founder of the company, CEO, department

manager and staff members in the manufacturing department.

5. Research findings

5.1 Emerging themes from the interview

The findings so far show that factors job applicants consider when they make their job

decision fall into two categories: the tangible instrumental factors and the intangible symbolic

factors. The instrumental factors can be further divided into five sub-categories, include

firstly the offered salary; secondly the job attributes, such as the required job skills and

knowledge, workload; thirdly the company location, such as the environment of the working

place, how far away is the company from where they live and from where their parents live.

Besides, the distance between the company and the schools is also under their consideration.

Fourthly, company’s current performance is another important factor job applicants evaluate.

Job applicants largely focus on the organisational success, such as company profitability,

company’s position in the industry, the quality of the product and the service. Finally, the co-

workers that the job applicants may work with in the future are also the factors job applicants

considered.

The symbolic factors that job applicants evaluate include firstly the companies’ identity. For

example, how the job applicants perceive the company, whether their self-identity meets with

the company’s identity are both under their consideration. Secondly, job applicants evaluate

the corporate brand and reputation of the future employer. Thirdly, job applicants also

evaluate the organisational culture. Fourthly, job applicants prefer the company which is

predicted with a positive future development. Finally, if working in the company is beneficial

for individuals’ own career development, such as gaining working experiences and building

strong CV, the possibility that the job applicants choosing to work for the company is high.

Factors that encourage the existing employees to stay fall into four main categories. In detail,

firstly, the management practice includes the compensation package and well-being system,

leadership, empowerment and the level of bureaucracy, organisational (internal)

communication and the promotion system inspires existing employees to stay. Secondly,

employees consider the company’s future development. Thirdly, by considering their own

future development, employees tend to stay in a company which can help them to gain

experiences and develop their skills. Moreover, building a strong CV to pursue a better job is

also being considered as part of the future development. Finally, employees’ relationship with

their company largely influences their decision. Relationships with the company comprises

employees’ relationships with their colleagues, management-workforce relationships,

whether employees can fit with organisation culture, whether employees’ personal value fits

with companies’ values and whether their personal identity fits with companies’ social

identity (See Appendix C: Summary of the results of the initial data analysis).

5.2 Analysing the findings

The research findings can reflect back to the literature which indicates that the match between

employer branding’s attributes and individuals’ personal requirements and expectations

motive employees to make their job decision.

However the research findings can be explained further. Firstly, the ‘match’ between the

employees and the employer branding can be explained by the ‘needs theory’ within the HR

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paradigm. ‘Needs theory’ indicates that individual’s behavior is driven by the demands of

satisfying the unsatisfied needs. People’s needs are differentiated in a hierarchy ranging from

the lower-order needs, which largely focuses on the basic needs for living, to the higher-order

needs, which ground in the psychological and social demand. The examples of the

hierarchical based needs theory include Maslow’s ‘hierarchy of needs’, Herzberg’s ‘Hygiene-

motivation’ framework and the study from Alderfer and McClelland (Haslam et al., 2000).

The various factors that employees consider in job seeking and job retention can be divided

into the lower-order and higher-order needs category. Further, it is argued that job applicants

tend to consider fulfilling their short-term lower needs first in the job market, for example,

whether the salary can cover the living spending, if the company location is convenient to

travel. Later when they make the retention and commitment decisions, employees will largely

focus on whether the company can satisfy their higher needs, such as the needs of self-

development and self-identity (Lievens, 2007; Lievens & Highhouse, 2003).

Secondly, employees also structure and use the ‘fit’ perceptions when they look for the job

and make decision on whether to stay or leave (Cable & DeRue, 2002). In detail, first,

employees judge the fit between their needs and the rewards they received from their

contributions to the company (Needs-supplies fit). Second, employees judge the compatibility

between their skills and abilities with the demands of a specific job (Personal-job fit) (Lauver

& Kristof-Brown, 2001). Third, employees also evaluate the fit between their personal value

with the organisation value and culture (Personal-organisation fit) (Cable & DeRue, 2002;

Van Vianen, 2000).

The fact that individual employees consider differently in their decision making can also be

explained by employees’ different perceptions toward their fit with the company. Previous

literature indicate that the N-S fit, which is largely associate with employees’ lower level

needs and employer branding’s functional attribute, influences job seekers’ initial decision in

the job market. P-J fit and P-O fit, which are associate with employees’ higher needs and

employer branding’s symbolic attribute, have a significant impact on employees’ decisions

on job retention and the turnover intentions (Westerman & Cyr 2004; Cable & DeRue 2002;

Lauver & Kristof-Brown, 2001; Cable & Judge, 1996).

6. Summary of the current findings and the future research plan

Current research findings demonstrate what job seekers consider as attractive in the job

market, what existing employees perceive as important to encourage them to stay. Further

analysis summarises the initial results and indicate that only when the job attributes meet with

individuals’ hierarchical needs, in addition, only when individuals can fit with the job, job

seekers will consider working for the company, hired employees will engage with the

company and stay long.

Future research plans include further analysing the data with focusing on the driving reasons

behind of employees’ job decision to advice the employer brand implementation further.

Future research plan also involves exploring the role of the manager in the employer branding

implementation. Therefore, a case study which focuses on understanding how the founders

and senior managers understand the employer branding concept and their roles in the

employer brand building will be conducted.

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Appendix A: The role of branding with customers and employees

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Appendix B: How the characters of branding influence customer and employees’

behaviour

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Appendix C: Summary of the results of the initial data analysis

Factors that job applicants consider as attractive when they apply for the job

Tangible factors Intangible factors

Ø Salary

Ø Company location

Ø Job attribute

• Job itself

• Office location

Ø Company current performance

(organisational success)

• Profitability

• Company’s position in the market

• Quality of the product or service

Ø Co-workers

Ø Organisation identity

• How employees perceive the company:

company identity

• Employees’ self-identity meets company

identity

Ø Corporate brand and reputation

Ø Organisational culture

Ø Company positive future development

Ø Working in the company is beneficial for

personal career development

• Gaining working experiences and building

strong CV

• Future career and personal plan

Factors that existing employees perceive as important to encourage them to stay

Symbolic Factors

Ø Management practise

• Compensation package and Employee well-being

• Salary and bonus plan

• Workload

• Welfare (vacation, apartment, insurance)

• Leadership, empowerment and the level of bureaucracy

• Organisational Communication

• Promotion

Ø Personal future development

• Gaining experiences and skill development

• Building strong CV for better job

Ø Company future development

Ø Employees’ relationship with their company

• Employees relationships with colleagues

• Management-workforce relationship (managers’ responsiveness to the needs and ideas of

employees)

• Employees fit with organisation culture

• Personal value fits with company value

• Personal identity fits with company social identity