Why Customers Care About Your Employer Brand (And Why You Should, Too)

It’s safe to say that focusing on customer needs is just plain good business sense. Satisfying the needs of people inside the organization is also a good idea, but certainly not as relevant to your immediate business goals. Right?

Wrong. The truth is that your employer brand—how current and potential employees view your organization as a desirable place to work—is as direct a driver of business outcomes as any other. A strong employer brand not only helps you attract and retain the qualified talent needed to better serve your customers, but also makes your overall brand more attractive to consumers themselves.

Employer Brand Extends Beyond the Office

Simply put, satisfied employees create satisfied customers. The American Customer Satisfaction Index (ACSI) found that a one-point increase in Glassdoor company rating is associated with a 1.3-point increase in customer satisfaction. Yet many employers seem unaware of how closely the two are related. What’s more, they often seem to forget just how far-reaching and influential the employee experience can be in the age of social media.

While your customers are able to get a feel for your employees’ experience during business-related interactions, it’s also easier than ever for customers to read first-hand accounts thanks to the transparency provided by social media platforms like LinkedIn and Twitter or job review sites like Glassdoor. You might be surprised to know that some customers are deliberately seeking these types of reviews prior to doing business with your organization.

In an interview with Glassdoor, marketing strategist John-Henry Scherck discusses how reading reviews from employees helps him get insight into the quality of a company’s work. “I look for agencies that treat their employees well,” he says, “so that when I hire an agency, I know my account manager will likely stick around and help me hit my goals.”

The unique circumstances of 2020 have also put organizations and their employer brands in the public spotlight. Fair or not, the way organizations responded to the pressures of the COVID-19 pandemic was often judged in the court of public opinion, with some being praised for their efforts to provide for employee needs and others being criticized for cutting pay, letting people go, or failing to adequately care for sick employees. More than ever, people are watching how companies behave, and basing purchase decisions in part on how companies treat their employees.

Employer Brand Matters to Customers

Your customers care about the way you do business and how you treat your employees, and they talk with their wallets. Sixty-four percent of consumers have stopped purchasing a product after hearing that the company treats employees poorly. The same goes for services like Uber; even though its drivers are technically independent contractors, some people still refuse to ride with Uber after allegations of sexual harassment and gender discrimination went viral more than four years ago. At the time, HR thought leader Dr. John Sullivan estimated that the “overall negative economic impact on Uber [would] eventually reach over 100 million dollars.”

Your organization doesn’t have to be an Uber-sized operation to feel such negative effects, either. Small and medium businesses are woven into their communities, as are their employees. Whether through observation, word of mouth, or online reviews, your community sees the way employees are treated and that affects their behavior. Most business leaders realize this: 96 percent agree that employer brand and reputation can positively or negatively impact revenue.

The tie between your reputation and customer loyalty is likely to only become stronger in years to come, as technology continues to add scrutiny and younger generations become primary consumers.

The tie between your reputation and customer loyalty is likely to only become stronger in years to come, as technology continues to add scrutiny and younger generations become primary consumers.

Employer Brand Requires a Deliberate Approach

Knowing that your employer brand reaches far beyond the job market and clearly matters to customers, you now need to give it room in your business success strategy. Here are a few ways you can start identifying and refining your employer brand:

Employer Brand Matters to Your Business

Spending time and resources on improving your employer brand should go hand-in-hand with employee satisfaction, hiring, and company brand initiatives—it’s the best way to take the hard work you’ve already put into crafting great employee experiences and putting it out into the world. And if you haven’t yet made employee and candidate experience a priority, the business value employer brand can deliver is a prime reason why you should. Done right, your employer brand becomes the genuine storyteller of how your organization cares for its people—and now you know everyone is listening.