linkedin ismp presentation
TRANSCRIPT
S
BB2b
B2B Marketing
Natasha QabazardGSBA 528
Table of Contents Title Slide
Executive Summary 3 Industry/Market Analysis 4-5 Competition 6-7
Value Chain 8-9 Customer Analysis 10-11 Company Analysis 12-19 Expanded SWOT Analysis 20-21 Recommendations 22 Recommendations Value Chain 23 Recommendations Target Markets 24 Recommendations Objectives 25 Recommendations Balanced Scorecard Metrics 26 Recommendations Marketing Mix 27 Projected Profit & Loss Statement 28 Implementation Plan 29 Contingency Plans 30 Appendices 31-34
Executive Summary This plan underlines LinkedIn’s core mission statement of connecting professionals
by specifically looking at one feature of their business model, that of Marketing Solutions.
Marketing Solutions makes up 20% of company revenue and is projected to have the highest growth rate out of any of their other segments,
With LinkedIn’s acquisitions of Pulse and SlideShare, B2B marketers now have the opportunity to reach a larger audience to generate leads through Sponsored Updates and attract new followers to their company.
This plan proposes to integrate Pulse and SlideShare into LinkedIn’s already existing core mobile application so that users can see Sponsored ads while exploring content.
The increasing migration to mobile activity over desktop proves the viability of this plan, increasing revenue in every quarter by 19%.
The primary target markets are companies who already use LinkedIn’s Marketing Solution’s capabilities. The secondary target market are existing LinkedIn members who use the mobile application.
By executing these strategies, financial targets should be set at: Net revenue: FY2015- $2.924B Net income- FY2015- $2.230B
Industry/Market Analysis Industry Definition: Online Recruitment Sites acquire
revenue through offering job listing services as well as ad placement space. Searchable database to source job postings Archive resumes and profiles
Numbers at a Glance $3.4B industry Growth rate of 14.4% Expected annual growth rate of 7.3% for the next five years
Industry Trends Low unemployment less job postings Platform traffic originating from mobile devices
Industry/Market Analysis Trends (Continued)
Existing businesses to increase workforce Growing talent gap companies competing for highly skilled
candidates Candidate tracking and talent strategy development Total number of businesses in US will grow by 1.6%
Legal/Regulatory Issues Lawsuits
Security breach in June 2012 LinkedIn user passwords posted on Russian hacker site Harvesting e-mail addresses without permission Spamming people to join the network
Competitors
LinkedIn Career Builder Inc
Indeed.com
Monster.com
Core Products
Premium SubscriptionsHiring Solutions, Marketing Solutions
Job postings, Candidate sourcing, HR Software, Workforce Data
Job postings, Resume finder, industry trends, salary search
Job posting aggregator, Resume builder and storage
Annual Sales Revenue/ Market Share
$2.21 Billion30.7%
$556 Million17.7%
$434 Million14.1%
$770 Million12.6%
Holding Company
Public Private Private Public
Strengths Social media platform, Software strength, Largest user base
Data Analytics,Present in 20 countries Supply/demand portal
Aggregates job postings from all sites
Accounts for 54% of online hires
Sophisticated algorithms
Twitter partnership
Weaknesses
Privacy issues
Too much focus on HR Saas segment
Pay-for-performance business model
Undergoing significant restructuring
Facebook Twitter LinkedInCore Products Personal profiles
InstagramMessengerWhatsApp Messenger
Website/Mobile appGnip
Premium SubscriptionsHiring SolutionsMarketing Solutions
Annual Sales Revenue/ Market Share
$12.5 Billion65.4%
$1.8 Billion16.2%
$2.21 Billion15.1%
Holding Company
Public Public Public
Strengths More than 1B active users (tons of data)
Mobile driven service
Professional network positioning
Weaknesses 92.2% of revenue comes from advertising
Does not have diverse product line
Competitive threats (Facebook)
Value Chain Suppliers
Distributors Retailers Customers Manufacturer
Suppliers CustomersComputers for employees (Apple, Lenovo) MembersConstruction personnel for office spaces BusinessesThird party interior design companies ConsultantsFood suppliers for cafeterias EnterprisesContract companies (Ex ZeroChaos Workforce Logic)Contractors (non full-time employees)Employee salariesEmployee Benefits (Health, 401K)Cleaning servicesDocusign HR services (Background check companies)
Value Chain ContinuedSuppliers
Content Providers – job postings,
resumes, etc.
SuppliersMaterials, Food and
Equipment
LinkedIn Corporation – includes all
personnel and functions
performed in-house
DigitalWebsite/
Mobile AppsCustomers
Customer Analysis Customer Needs/Preferences
Quality content so members can stay informed about opportunities for career improvement Content shared through features like SlideShare
Sophisticated database to help businesses find top candidates Efficient software that businesses can use to market products
and create a pipeline of leads Easy-to-use mobile application for both customer segments
Mobile constitutes 45% of online traffic; exponentially growing Customer Segments
Primary: Businesses who purchase SaaS (Talent Solutions 60% of revenue, Marketing Solutions 20% of revenue = 80%)
Secondary: Members (free profiles, Premium Subscriptions)
Customer Analysis
Premium Subscribers
Very Active Free profile members
Companies that utilize Talent &
Marketing Solutions
Companies that utilize one or the
other Solution
Consultants
Small companies
PlatinumGold
Iron
Lead
Businesses Members
Semi Active Free
profile members
Passive Free profile
members
Company Analysis LinkedIn’s was founded and headed by Reid Hoffman in 2002
Launched in 2003 with a very slow growth rate (20 signups/day) but showed enough promise to attract an investment from Sequoia Capital, a large venture capital firm
1,000,000 members and and introduced their first business lines: Jobs and Subscriptions
By the launch of public profiles, LinkedIn begins to claim the professional profile of record and reaches profitability with the core features like Recommendations and People You May Know
Went global in 2008 with the opening of first international office in London and launching Spanish and French language versions on the site
Jeff Weiner becomes CEO in 2009 and brings focus and clarity to LinkedIn’s mission, values, and strategic priorities
By 2010 they had 90,000,000 members and in 2011 became a publicly traded company on the New York Stock Exchange
In the decade on LinkedIn’s existence, they acquired 225 million members and growing at a rate of two members per second
Company Analysis Key Statistics
Number of product lines: 3 (Hiring Solutions, Business Solutions, Marketing Solutions)
Number of employees: 8,700 Number of countries where products sold: 200 countries 2015 Expected Revenue: $3.0 Billion, Profit: $2.6B
2014 Revenue: $2.2 Billion, Profit: $1.9B 2013 Revenue: $1.5, Profit: $1.3B
Acquisitions Pulse SlideShare Lynda.com Bizo
Company Analysis-PositioningLinkedInPosition:
For the young, tech-savvy professional of the world, LinkedIn’s business solutions provides a sophisticated network by efficiently using data to understand the most important business problems for both user and businesses
Businesses
Mid-size company that needs Talent and Marketing Solutions
Active Job Seeker
Recent college graduates who are in need of jobs
Passive Job Seeker
Employees who have stable jobs and are not looking for a new one
Company Analysis- Core Competencies
Positioning: Offers the largest professional social networking site in the world Massive amounts of data
• Quality Software
• Service Development
Company Analysis-Business Model
ProfessionalProfiles
PremiumSubscriptions
Research &
Development
CollectionOf
Data
BusinessSolutions
Pull Marketing
Free Profiles
Innovation
Trained Engineers
TalentMarketingBusinessSolutions
Perceptual Map for Social Networking Industry
Low member count
Amateur
Professional
High member count
Perceptual Map for Online Recruitment Industry
High # of Diversified Products
Low Member Count
High Member Count
Low # of Diversified Products
Marketing MixBrand Premium
Subscriptions
Talent Solutions
Business Solutions
Marketing Solutions
Product Job Seeker RecruiterRecruiter LiteJob SlotsJob PostsCareer PagesWork With Us Ads
Sales NavigatorBusiness Plus
Lead AcceleratorSponsored UpdatesSponsored InMailDisplay AdsText Ads
Place Online Online Online OnlinePrice $29.99 $64.99
Customized$64.99$47.99
Customized Based on Company Size
Promotion Digital advertising on LinkedIn site
Digital advertising on LinkedIn site
Digital advertising on LinkedIn site
Digital advertising on LinkedIn site
SWOT AnalysisStrengths
• Large Network: #1 professional social networking site in the world
• Diversified Revenue Sources
• Recent AcquisitionsOpportunities
• Increase in mobile use and presence
• Upward trends in social recruiting
• Growth of Chinese market
Weaknesses• Violation of
data privacy• Competitive
Disadvantages Compared to Facebook
Threats• Market
Saturation• Labor market
issues could restrict growth
• Increased Regulations
Expanded SWOTMaximize Strengths and Opportunities
Minimize Weaknesses and Threats
• Innovation: Continue to enhance mobile application offerings; integration to core LinkedIn app
• Build International Market Share: Offer LinkedIn’s mobile app to Chinese market to promote market share
• Offer More Data: provide personal analytic services
• Secure Facebook Parternship: allow for LinkedIn integration on Company pages through Facebook
• Improve Adaption to Regulations: Create a cost effective plan for potential issues
• Marketing: Target new core user; include blue collar offerings
Recommendations Primary Recommendation
Integrate existing Pulse and SlideShare mobile applications into LinkedIn’s core mobile application Modify Pulse and SlideShare’s viewing capabilities to fit into LinkedIn’s app for seamless
content generation and engagement New product offering must be easy to use and have minimal bugs Sponsored Ads and Display Ads must be present and prevalent
Update the Recruiter application to allow other kinds of business personnel to conduct B2B activities Allow application to monitor and track ad reach to enable modifications for real time
changes Make instant sharing of B2B activities visible to other company employees
Financial Objectives Net Revenue for 2015: $2.924B Net Income for 2015: $2.230B
Recommendations-Value Chain
SuppliersContent Providers
– job postings, resumes, etc.
SuppliersMaterials, Food and Equipment
LinkedIn Corporation – includes all
personnel and functions
performed in-house
DigitalWebsite/
Mobile Apps Customers
Recommendations-Target Customers
Platinum
Gold
Businesses Consumers
Companies thatUtilize Talent & Marketing SolutionsB2B
Marketers that use apps regularly
Small Companies
Employees that check their apps regularly
PremiumSubscribers
Active Pulse and SlideShare Users Very Active
Free Profile Members Minimally ActivePulse & SlideShareUsers
Recommendations-Objectives
Sales• Drive Marketing Solutions sales to
$834MM in 2016, $920MM in 2017, and $1B in 2018
Profit• Targeted Marketing Solutions net profit is
$670MM in 2016, $840MM in 2017, and $910MM in 2018
Mix
• Marketing Solutions percentage of total business to be 25% by the end of 2016 and 28% by the end of 2017, and 33% by the end of 2018.
Recommendation-Metrics of Success
CUSTOMERPERSPECTIVE
• EASY USE OF APP
• HIGH QUALITY ADS
• CONSISTENCY IN INNOVATION
• HIGH RATING IN APP STORE IS CRITICAL
OPERATIONAL PERSPECTIVE
FINANCIAL MEASURES• CALCULATE R&D ROI
•VOLUME INCREASE IN AD SALES
•VALUE OF PER APP DOWNLOAD
•POTENTIAL CUSTOMER VALUE
•POTENTIAL BUSINESS VALUE • QUALITY TESTING OF APPS
•MINIMAL GLITCHES, ACCURACY• >99.5%• • APP CREATION TIME MAXIMIZATION
• EFFICIENT MARKETING TIMELINE• PLAN•
INNOVATION ANDLEARNING
PERSPECTIVE• 2 NEW APPS• 1 LINKEDIN CORE
APP• 1 UPDATED
RECRUITER APP• 90 DAY BETA TEST• EDUCATIONAL TRAINING FOR SALES DEPARTMENT
Recommendations- Marketing Mix Primary and Secondary Targets
Platinum customers: 21-35 yrs. Old, professionals, with an average income of $55,000, and that regularly check mobile applications and are highly attracted to easy to use applications that integrate content
Gold customers: Mid size companies who use B2B marketers to maintain the company brand and want to attract top candidates through targeted ads
Product Place Price PromotionObjectives Introduce the
new integrated LinkedIn core app and Recruiter app tailored to mobile device users
Offer free LinkedIn core app in app stores and linked on company website
Core LinkedIn app will remain free and updated Recruiter app will be free with subscription
Use marketing budget to allocate $50M with 90% majority going to digital advertisement
Strategies Research proper methods to integrate Pulse and SlideShare content without affecting interface
Offer beta format to LinkedIn employees to test out first and perfect for app store
Monitor the value of each download and determine if tiered pricing is the proper next step
Advertise new apps on LinkedIn website as well as app stores
Most Likely Projected Profit & Loss Statement
Implementation Plan
Contingency Plans Contingency plans if objectives are exceeded
Pulse and SlideShare Integration Increase number of integrations to other apps like Sales Navigator Offer app in international markets abroad
Recruiter app update Spend more money on researching other B2B needs worth offering Increase money on advertisement and promotion
Contingency plans if objectives are not met Pulse and SlideShare Integration
Analyze interface and decide how to improve upon it Scale back expansion plan
Recruiter app update Reassess marketing campaign and research more targeted business
methods Decide whether integration should be deleted and go back to normal
Appendices
Source: LinkedIn Website
Source: comScore, Wells Fargo Securities, LLC
Source: LinkedIn Company reports, Wells Fargo Securities, LLC
Source: Company Data, Brean Capital Estimates