The rise of social networks and the emergence of microblog recruitment has posed a challenge to traditional recruitment networks. However, no such signs were evident in the latest financial report released by 51job last Friday. President and CEO of 51job, Ronghui Zhen, told business reporters that dividing recruitment networks into traditional and new types was merely playing with concepts. Since its establishment in 1998, this industry has been highly competitive, and if not for continuous reform and progress, 51job might have already ceased to exist. Last year's profit growth reached 70%, setting a new record for 51job's performance in 2011, with revenues reaching 1.37 billion RMB, an increase of 26%. Profit growth reached as high as 70%, driving the company's stock price up by 11.99% on the day of the announcement, closing at $50.64.
"Recruitment difficulties" and "job-seeking difficulties" are two long-standing issues in China's talent market, creating a massive online recruitment market. The latest financial report shows that 51job holds 2 billion RMB in cash, providing ample funds for strategic maneuvering. "We don't lack money; we're waiting for new opportunities to make money," said Zhen Ronghui. "Unfortunately, while there are many new ideas in the market, there aren't many business models that can sustainably and scalably generate profits." Despite this, only 51job is publicly listed in this sector, and fewer than three companies have reported profitability. Losses, leadership changes, capital withdrawal... numerous negative pieces of information have cast a shadow over the online recruitment industry. People can't help but ask: what's wrong with this industry?
Since its listing in 2004, 51job has consistently remained profitable, breaking records repeatedly. Zhen Ronghui said, "A listed company, a market-leading enterprise, and a company with substantial cash flow must adhere to not doing foolish things when the market is good and doing the right things when the market is bad." He emphasized that 51job has never neglected innovation, and it is precisely because of continuous innovation that it has maintained steady growth in the fiercely competitive recruitment market. "Companies need to adapt to the market," he added. In previous years, offline services accounted for a large portion of total revenue, but today, online recruitment service income predominates, reflecting the result of adapting to client demand changes.
"The space in the online recruitment market is still vast," Zhen Ronghui told business reporters. 51job serves hundreds of thousands of clients annually, while China's employment enterprises number in the millions. Even targeting existing clients, there remains significant room for improvement and growth. It is understood that in 2011, 51job established call centers and regional business centers, expanding its service coverage to over 80 cities. This year, the company plans to continue accelerating market expansion.
Beyond expanding its business scope, the company continues to deepen its service offerings. 51job is not just a simple recruitment service company; it provides a comprehensive suite of human resources services, including training, assessment, industry research, personnel outsourcing, etc., thereby establishing long-term deep cooperation relationships with clients. In 2009, affected by economic downturns, 51job's recruitment services suffered significantly, but its personnel outsourcing business grew rapidly.
The style of a company often has an inseparable relationship with its leader. Regarding the hot topic of innovation, Zhen Ronghui has always maintained calm reflection and independent analysis. "Does the rise of social networking sites pose a threat to online recruitment? Does 51job plan to engage in social network recruitment?" These were the questions Zhen Ronghui faced most frequently last year.
However, "timing" has always been Zhen Ronghui's consistent strategy. "When a new form appears, dozens of companies immediately follow suit, and then price wars begin. Like last year's very popular group buying trend, which didn't mature and quickly failed," Zhen Ronghui believes that so far, there hasn't been a very influential professional social networking site in China.
The concept of social networking originated in the U.S., where its primary users are talent intermediaries or headhunters. This is because many foreign companies habitually recruit through intermediaries or headhunters, which contrasts entirely with the current industry ecosystem in China. "China doesn't have many large-scale headhunter companies, and we provide point-to-point recruitment services. We can smoothly post job openings and search for suitable candidates without needing an intermediary."
Secondly, social networking sites require a certain scale to function effectively. Currently, there are more than ten relatively active social networking sites in China, with scattered users requiring some time to grow. Finally, and most crucially, is the quality of the social circle. An online profile claiming to be a 35-year-old professional with ten years of experience could easily be a recent college graduate, significantly impacting the confidence of high-end professionals in using social networking sites. Notably, 51job's website recently added a feature called "Join Fan Group," which resembles a social networking function. After joining a particular employer's fan group, job seekers can promptly understand the employer's hiring trends and communicate with other users within the group.
Zhen Ronghui said, "We do not reject learning from new things. However, when the market is not yet mature, we prefer to incorporate some functions from social networking sites into our services." He also informed reporters, "We are prepared. If social networking truly becomes popular in the talent market, it will also present a great opportunity for 51job, which has over 54 million registered individual users."