Sourcing Heats Up and with Indeed’s Latest Product Announcement

Indeed recently announced its latest iteration of AI-powered products: Smart Sourcing. It comes at an interesting time in the market.

Indeed recently announced its latest iteration of AI-powered products: Smart Sourcing. It comes at an interesting time in the market.

On the buy side, Aptitude Research’s latest study on AI in Human Resources (HR) found that 72% of companies anticipate increased investments in AI solutions this year. In the market, HiredScore (arguably the leader in matching and scoring AI) was acquired by Workday, while HireEZ and Findem (both leaders in Sourcing AI) expanded into candidate relationship management (CRM). And for Indeed itself, their first big commercial play in AI matching and scoring with a bold move to a PPA model last year.

We covered the PPA announcement with avid interest. Though Indeed ended up pausing the PPA program, this latest announcement signals they’re not letting it slow them down—quite the opposite.

It’s a good time for a company like Indeed to bet big on AI in talent acquisition. The latest job numbers in the US show strong growth, while interest in recruiting and hiring AI solutions is just as strong.

I had a chance to sit down with Raj Mukherjee, EVP and General Manager, at Indeed to talk about this new offering, their continued investments in AI, and how Indeed is delivering on its mission to make hiring simpler, faster, and more human.

According to Raj, Indeed’s offering has a few key competitive advantages:

  • First, Indeed’s Smart Sourcing pulls from an active database. “Indeed has a unique offering in that we give employers access to candidates active on the platform that are looking for new roles,” Raj says.
  • Second, Indeed is seeing a significant improvement in response rates from matched candidates. Raj reported that candidates who are a strong match for a search are 17x more likely to apply than regular job seekers.
  • Third, Indeed’s connected experience—specifically the ability to schedule interviews immediately—gives employers the ability to quickly convert interested, relevant candidates and get them in front of a hiring manager.

Here are a few of the key things I took away from our conversation—and my observations on this announcement:

AI is officially a must-have rather than a nice-to-have.

As an analyst, my job is to track technology trends across the world of work. We’ve been talking about AI in HR tech for a while now, but the conversation has recently made a serious paradigm shift.

Whereas before, only those most innovative talent acquisition teams were doing significant AI projects, Indeed’s latest push into the market makes it official: we’re in the Early Majority stage of AI in TA. Now, companies, big and small, innovative and ordinary, can utilize machine learning, natural language processing, and Generative AI to tackle some of the fundamental challenges in recruiting.

Things are heating up in Sourcing—not slowing down.

Though we were all sad to see so many of our colleagues in Sourcing impacted by RIFs over the last 18 months, we should all be encouraged to see innovation in Sourcing tech alive and well. Raj cited a US$6 billion market for recruiting automation, of which I think Sourcing could easily be 1/3 or more.

Indeed began running a Smart Sourcing beta in November and has seen substantial adoption among SMB organizations—a market untapped by the leaders in Sourcing tech due to lower profit margins for a SaaS model. Will Indeed continue to push up-market and drive Findem, SeekOut, and HireEZ to rethink their product and go-to-market strategies? I think we’ve only begun to see the ripples that the rapid advancement of AI is making in this market.

Adoption of AI in HR depends on human in the right loop.

Raj and I had a spirited conversation on what makes two use cases that both utilize matching and scoring AI can be received so differently. We all know that “human in the loop” is an important success factor for safe, ethical, and effective use of AI. With Smart Sourcing, a recruiter is in the driver’s seat for most of the workflow—the AI is augmenting their efforts at each step, including GenAI creating outreach messages.

With PPA, the AI was doing almost everything—and the recruiter or hiring manager just had to say accept or reject a matched candidate before moving forward in the process. Hiring remains a hugely human thing, and people want to know they’re in control. Both Raj and I think that Smart Sourcing is putting humans in the right loop by augmenting and enhancing workflows rather than over-automating them.

Indeed remains committed to a dual value proposition for AI in talent acquisition.

Perhaps the most enlightening part of my discussion with Raj was the lessons learned from last year’s PPA play, specifically regarding what they were bringing forward to this new innovation. Raj said, “We have to ensure that the data we are providing to employers and to job seekers—that is, the recommendations, the matches—are trustworthy.”

Having played with Indeed’s recommendation engine myself over the last six months (I created a profile to test their matching and scoring when I did a write-up last fall), I can say that they’ve made a lot of progress since I first signed up. This same matching engine—built on millions and millions of data points generated by users on both sides of the talent marketplace—is powering Smart Sourcing, which makes me optimistic about Indeed’s ability to deliver value with their latest offering.

 I’m encouraged to see Indeed continuing to invest in this dimension of recruiting AI. Not only does it serve a real need and enhance user experiences for employers and job seekers alike, but it also further differentiates Indeed from traditional job boards and marketplaces—a space they disrupted a long time ago.

Time will tell just how disruptive Smart Sourcing is for other sourcing AI providers, and I’ll be watching this corner of the market with interest.