Indeed is introducing two new pricing models in 2023, pay per started application (PPSA), and pay per application (PPA). These pricing models are replacing the previous pay per click (PPC) model, which will no longer be available. The transition to these new models began with smaller employers in 2022 and is being rolled out to mid-sized, large, and enterprise employers through 2023.
This shift has already gone into effect, so it’s essential to know what this means for recruitment marketers. Read on to learn more about what’s new and what’s different about Indeed’s new pricing models.
The Old Model – Pay Per Click (PPC)
Indeed was a pioneer in offering pay for performance advertising for jobs, and the payment model offered was pay per click (PPC). Over the years the exact point of payment for each click on Indeed evolved, and in its most recent form this payment model triggered a charge to an advertiser when a jobseeker clicked on a sponsored job on the Indeed search engine results page (SERP).
The paid click on the SERP opened a second pane on the page that displayed the full job content and offered the jobseeker options for applying or navigating to the advertiser’s career site to apply there. If a jobseeker did not engage with the advertiser’s job further, the advertiser still paid for the click.
Pay Per Started Application (PPSA)
For the two new pricing models, there are distinct differences. Let’s look at pay per started application first. Pay per started application is now the pricing model for jobs indexed by Indeed, unless the jobs are opted into using Indeed Apply. Indexed jobs ultimately lead jobseekers to the advertising employer’s career site to interact with the employer’s brand and submit job applications.
The pay per started application pricing model moves the trigger for charging an advertiser from the initial click on a SERP job listing to the click on the “Apply Now” button in the second pane after the full job content is displayed to the jobseeker. This model charges advertisers only when candidates begin an application vs. when the second pane view is populated.
When sponsored jobs are aggregated from the company's career site by Indeed, the charge point will be shifted from a standard job advertisement click to each started application from higher-intent job seekers.
Pay Per Application (PPA)
The second new model, pay per application, is for jobs that are fully hosted on Indeed or indexed jobs opted in to Indeed Apply. Indeed Apply enables jobseekers to submit applications to jobs without leaving Indeed.com. In the pay per application model, employers sponsoring jobs on Indeed pay when a candidate submits their completed application through Indeed.
“This is a big change," said Maggie Hulce, Indeed's executive vice president and general manager for enterprise, speaking at Indeed FutureWorks, a conference held Oct. 13, 2022 in New York City. "Indeed's mission is to help people get jobs, and one of our values in support of our mission is pay for performance. As part of this, we are transitioning from a model of pay per click to pay per started application and pay per application, both steps getting employers closer to the hire."
Are There Advantages for Employers?
In each of the new models, an employer advertising on Indeed is charged at the furthest point that Indeed can track. In other words, employers are now paying for a jobseeker action that happens further in the application funnel. The intent with each model is to minimize clicks (and subsequent charges to employers) that don’t result in candidates applying to advertiser’s jobs.
These changes are intended to deliver an improvement in candidate quality, along with a reduction in candidate volume from candidates who find they aren’t qualified for the role advertised.
However, pricing will vary depending on market dynamics and other factors – which is why Indeed plans to enact a fee structure that considers these environmental factors. These factors can include market conditions, location, job title, and the number of available job seekers. How each of these factors influence pricing and how the ultimate prices will be calculated is not yet known.
With the new pay per application pricing model, Indeed is also asking companies to provide “screener questions” to quickly vet if an applicant meets the job criteria – allowing companies to only pay for valid applications.
Indeed provides pre-made screener questions, or companies can create their own questions to include on the application. These questions can ensure candidates know what’s required for a particular job before they complete an application, thereby discouraging unqualified applicants.
For the screener questions, companies can make the response required by checking a box called “deal breaker,” which is found next to each question. This will make the questions mandatory requirements for the job application. If these deal breakers are set and not met, companies can give Indeed permission to file the applicants under the “Rejected” tab on the Employer Dashboard.
Tip: Companies will still have access to the applications, even if they don’t meet the “deal breakers.”
Employers who review applications in the Indeed dashboard will have up to 72 hours to deny applications that do not match hiring requirements. Indeed will not charge for applications rejected in that timeframe.
Screener questions can help hiring professionals by using automation to narrow down a candidate pool to higher quality applications. Screener questions can also help the candidate experience in the hiring process, ensuring candidates know exactly what is required for the role. However, adding in screener questions may also impact an advertiser’s conversion rate and decrease the overall volume of applicants received because the screener questions add more steps to the application process.
What To Keep In Mind With Indeed’s New Pricing Model
Finding the right candidate for a role is a time consuming and pricey process. The new pricing models are intended to prevent employers from paying for clicks and applications from unqualified candidates.
According to Indeed, “with PPA you have more control over your quality and spend, because Indeed lets you review applications before you’re charged, giving you the final say on which applications you pay for.”
At first, employers may pay more to use this new pricing model. However, there may be benefits to this use in the long-term. Pay per application is intended to ultimately save employers money – since hiring professionals focus on quality applicants faster and will only pay for applicants who can result in a hire.
When companies post their jobs on Indeed, they will receive a notification about being charged for each application. There will be specific parameters in place to limit spending, including a cap on the maximum applications the company can receive or how much they will pay Indeed. When the company has enough candidates, they can close the ad.
This new pricing model is rolling out Indeed wide in 2023, and marks a major shift from previous models.
If you’d like more information about advertising effectively on Indeed and how to navigate these changes, reach out today!