Linked In Corp 2008 Avimanyu Datta Assistant Professor

Linked. In Corp. , 2008 Avimanyu Datta Assistant Professor, Illinois State University

Linked. In Corp. : Overview � Vision › Positions itself as a full service professional “productivity tool” (not just personal networking or jobsite) › It can be argued that Social Networking will naturally segment along the same lines as traditional media with solid defensible niche for business oriented service › Building high switching costs Full Service Professional productivity Tool Growth of Social Networking Build Switching Costs

Linked. In Corp. : Overview � Value Proposition › Strives to draw professional users by improving its offerings and differentiating itself from Social networking Sites(SNSes) that promote personal and recreational Social Networking. › Driving users to visit Linked. In for multiple reasons. › Reaching other networks while preserving privacy. Differentiate Drive users to visit for multiple reasons Connectivity without compromising privacy

Linked. In Corp. : Overview � Value Proposition › Rolled out a new home page comprising Linked. In News • News feed based on fellow members viewing behavior • News feed on industry, products or interests Customizable Modules • Users could tailor their personal homepage. • Example, “Answers”, “People”, “Jobs” Status • Effective way to engage and tap into knowledge of the system. • Advice, hire etc.

Linked. In Corp. : Overview � Business Model: five sources of revenue Advertising Corporate Solutions Primary Research Subscription Job postings

Linked. In Corp. : Overview � Platform Management › Functions as a technology platform on which users can build applications for value additions. › Allowed Google’s Open. Social platform to create conference calendar. › Unlike Facebook, Linked. In has stricter controls and quality standards. › Linked. In philosophy “ We won’t allow viral spreading of unprofessional applications”.

Linked. In Corp. : Overview � International Expansion › Languages other than English planned: French, Japanese, Spanish. › Chinese: Be more specific › Japanese culture looks down upon disloyalty to current employer. › In China it is spend months to het recommendations and personal referrals, so current model many not work.

Linked. In Corp. : Overview � Competition Facebook My. Space Orkut Xing Social Network Services Professional network Services Monster Specialized: The Ladders

Linked. In Corp. : Overview � Strategic Dilemma 1 Closed Environment � Strategic Open Dilemma 2 Exclusively Professional Go Social

Three Essential Aspects � Network Effects in Social Networks � Evaluation of Linked. In’s Strategy � Evaluating the Dilemmas

Network Effect of Social Networks Linked. In in links Users, Application Developers, recruiters, Advertisers, and Experts. � Company should explore where the network effects are strongest and what are the potential negative network effects. � › Positive effect: Positive sum game between entities › Negative effect: Zero sum game between entities.

Network Effect of Social Networks APPLICATIO N DEVELOPER S RECRUITERS USERS EXPERTS ADVERTIZER S

Network Effect of Social Networks � Two conflicting Arguments Market Will Tip Market won’t tip Global markets Geographically Segmented Switching Costs to move networks Low switching costs, easy to multihome Platform: Applications will emerge Open. Social (Google) Levels the playing field Professions are a distinct segment Social Networks will engulf PNS Quality of users attract other quality users Vertical and horizontal segmentations

Evaluation of Strategy: Positive Sides Marketing: Viral Customer Acquisitions Creating Platforms for Applications Great Propositions for Job Seekers: Don’t have to alert your employers Business Model: Robust with Multiple Revenue Streams Pricing: For non-premium users. Attracts a large no. of users Focus: High Quality Professions (Great Audience)

Evaluation of Strategy: Negative Sides Face book may create a separate PNS Page Network gets diluted with growth No Deep and established switching costs Will the model really work across several cultures Substitute technologies: True cloud computing where all profiles are available on the Net Open Social (Google) may commodizes the PNS space

Dilemma 1: Open Versus Closed Architecture � Advantages of Dismantling the Walled Garden Developing Loyalty through Openness Getting Ahead of the curve Benefitting from Interoperability with other online communities

Dilemma 1: Open Versus Closed Architecture � Disadvantages Opening the Platforms to users Undermining Some of Linked. In Specific network effects Losing the ability to control user experience; loss of quality control Could Linked. In monetize the users as effectively, if it was truly open.

Dilemma 2: Broadened Scope versus purely professional network � Advantages of adding social networking services › Leveraging a platform that is already in place. › Increasing “stickiness’ of services and increasing the frequency of visits. Where do you visit more? Linked. In or Facebook.

Dilemma 2: Broadened Scope versus purely professional network � Disadvantages of adding social networking services › Diluting the Linked. In brand its differentiation from big SNSes › Failing in efforts to compete with big SNSes

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