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Why does LinkedIn want to be a media company? It’s all about the data

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In the past few weeks, I’ve found myself clicking on the headlines of business stories and expecting to head to a traditional media outlet’s website, only to find myself landing somewhere fairly new and unexpected: to the career-oriented pages of LinkedIn(s lnkd).

We’ve written a great deal about LinkedIn over the past few years: How it’s become a engineering powerhouse built around data, how more than half of its revenue comes from its corporate recruiting product, and how it’s building algorithims to get you considering jobs that you never knew you wanted.

So in a sense, it seems like an odd fit that in the past few months, we’ve been writing more about LinkedIn becoming a media company. Between the acqusition of the new reader Pulse, the growth of LinkedIn Today (the company’s news feed on its homepage), and the launch of LinkedIn Influencers (the blogging platform for select users), there’s no doubt that it’s emerged as a serious place to go for your business news.

For a company that didn’t start out in the media business, it’s a funny direction to take. But with more than half of its business coming from the corporate recruiting product it sells to companies, a growing media business brings eyeballs and attention to the site, which in turn fuels data to the recruting side.

“We want to be the place you go in the morning to get the news and insight before you start your day, or the place you check in when you’re betweeen meetings,” said Ryan Roslansky, who is the head of content products for LinkedIn. And LinkedIn is making progress in that direction.

LinkedIn Today, which provides you with a stream of news updates, has been around since 2011. But LinkedIn has only had Influencers, the select group of bloggers including Bill Gates and Richard Branson, writing for the site since October (a feature it launched in just six weeks, as they explained at our Structure conference). A company spokesperson said the blog posts have helped drive an eight-fold increase in traffic on LinkedIn Today over the past year, and each posts get, on average, more than 100 comments, and some of the top posts garner more than 100,000 pageviews.

LinkedIn Influencer page

It’s worth asking, why exactly does LinkedIn want to become a media company? As we’ve written here at paidContent repeatedly, the state of online advertising is not a thriving business right now. While different companies are experimenting with things like targeted or sponsored advertising to support content, it’s still an uncertain future for digital publishers. AdAge wrote recently that LinkedIn is pitching companies on “sponsored updates,” or native advertising in its feed, as part of its growing media presence.

But still, revenue from advertising only made up 23 percent of LinkedIn’s total revevenue in the first quarter — the other 77 percent comes from subscriptions to LinkedIn’s premium product (20 percent of overall revenue), and Talent Solutions, the corporate recruiting products that companies purchase (a whopping 57 percent of total revenue.)

So even if LinkedIn is successful at introducing sponsored content within the news feed, it’s clear that Talent Solutions is the biggest money-maker for the company. The section brought in $184.3 million last quarter, an increase of 80 percent compared to the first quarter of 2012. And the key to Talent Solutions is generating data on the site.

paidContent Live 2013 Daniel Roth LinkedIn
Daniel Roth, Executive Editor at LinkedIn who oversees content on products like LinkedIn Today, speaks at paidContent Live 2013 in New York in April 2013. Albert Chau /

As I’ve written previously, the company takes the information that consumers upload to their digital resumes and uses it to provide companies with suggestions and tools for hiring. These tools include allowing corporate recruiters and human resources employeees to post job ads, search for relevant candidates, track responses, and monitor candidates they’d want to hire.

But with only 225 million registered users on Linkedin, the company needs to bring more attention to the site if consumers are going to keep fueling the data needed for recruiting. That user base is small compared to Facebook’s 1.11 billion monthly active users or Twitter’s 200 million monthly active users. And the company understands that professional business news that people can read at work or on their phones is a great way to do that — certainly much better than spamming them with endorsements from mothers-in-law.

“Content is a frequent use case. Members do check professional content to stay abreast of what’s going on in their industry,” Roslansky told me. “People come back to LinkedIn for the value proposition we offer, and the more frequently they come back, the more likely they are to subscribe to one or our premium services, or the more likely they are to update their profile.”

8 Responses to “Why does LinkedIn want to be a media company? It’s all about the data”

  1. John Henry

    For such a straight forward article this has generated some very interesting comments. Most of which are not related to the article.

  2. Paul Kyl

    Everyone is an expert on Lnkd, including bogus members.

    Then there’s the 10 Billion SPAMs or more per week lnkd sends out.

    90% plus of lnkd ‘s members do not visit the site once per week if at all.

    Premium membership ? Someone earning $500 a month in India is prepared
    to pay $50 per month to join a garbage site ?

    What about the daily Pump and Dump useless headlines Lnkd is paying
    media types to write up for lnkd ?

  3. Tom Laird

    Put into context, here’s what this amounts to: opportunity.

    The majority of LinkedIn users are there for a reason; to find, get, promote and provide business opportunities. Period. And adding more useful content adds to that function.

    LinkedIn is a social media platform in form, but really a business platform in function.

    Me? I like that. Cut to the chase. Be there for reason. Get or give what you need. Move on to your next need or process.

    The value in LinkedIn is in providing a hub for building a network of connections and a capability to apply a certain focus, along with pertinent content.

    That is my expectation. That is what I get. And that is why I come back.

    It works for me.

  4. Ric Dalpay

    You Said: “the company takes the information that consumers upload…allowing corporate…. human resources…to … track responses, and monitor candidates …”

    I SAY: Linkedin is positioned to cherry pick Political Allies, rather than competent labor, represented by the AFL-CIO.
    – Ric Dalpay

  5. Mir Asraful

    I’ll just put it out there: I don’t like the concept of job search. I vote for the term being eliminated from our lexicon, and replace with “job find.” How would it feel if the right people and the right opportunities came to you? I’m not talking about magic. I’m talking about positioning yourself the right way so that you attract those right opportunities. Magnetizing your audience and magnetizing your opportunities is the next secret to successful LinkedIn job search.

    Most candidates are currently doing the opposite of magnetizing. Think about this: going uphill is hard, right? Pushing a boulder while you’re going uphill would be even harder, no? All that pushing is what most people do in the job search. You’re pushing yourself out there, blasting your resume out to companies, and bothering recruiters you don’t really know, who are likely not in an industry relevant to you, and who don’t know of anything open for which you could be a match. Instead, magnetize. Attract. Position and optimize your LinkedIn profile so that when employers and recruiters search for someone with your particular brand of expertise, you appear high in the search results. We have a full presentation on how to magnetize in our free webinar
    Magnetizing, instead of pushing, is critically important for several reasons. First, the recruiter initially approaching you will likely spark a much more beneficial scenario than you approaching him. The person’s not approaching you just to chat. He’s selecting you because he thinks you may be a match for an open opportunity he has right now. Second, the entire act of magnetizing is simply empowering. Gone are the feelings of frustration, repeatedly being ignored, and continually getting rejected. Instead, the right recruiters seek you out.

    So create your account

  6. indichas

    I find a certain irony in the fact that Yahoo! is trying to shed it’s image as a media company and is trying to become known as a ‘tech’ company, while LinkedIn is busy beating a path to become a media hub. As far as news sites go, I use BBC, CNN, PBS and I find most of the ‘influencer’ posts on LinkedIn to be Shill, Fill, and Redundant. Sometimes there are noteworthy pieces that are well-written on the site.

    • Paul Kyl

      Yahoo became a media company under Jeff Weiner, then VP at Yahoo, and now surprise, surprise, CEO at Lnkd.

      Lnkd is a media company generating 10 Billion SPAMs a week.
      I don’t know of a bigger Ponzi scheme company than Lnkd.
      So called 225 Million membership of which 90% plus are dormant.

      Then there’s relentless insider selling to the tune of $1.7 Billion profit since IPO.

      Yea, Lnkd is going to $300 , that’s why insiders are selling each and every week before it gets to $300, right ?

  7. Somewhat unrelated but maybe an idea for another post some day:

    When you subscribe to Linkedin you receive a couple of “credits”, every month, that you can use to contact folks out of your network — it’s something you’d have to pay $10/each if you didn’t have a subscription.

    If you decide to take a break from your subscription, ALL of the credits you accumulated over the months or years are deleted.

    I had 20+ credits ($200+worth)…and after having spent $500 over 12 months on the subscription…I decided to take a break from it. I lost all of my credits.

    This experience has made me so angry that I no longer care to subscribe to their service again.