linkedin business model

LinkedIn Business Model – Networking Made Easy

LinkedIn is a social media platform primarily focused on connecting the professionals globally. With over 500 million users across 200 countries, the LinkedIn business model has positioned itself as an employment-oriented service, representing real-world professional relationships.

The core features at LinkedIn business model are free but the extended features, both for the recruiters and the job seekers, bear charges.

What is LinkedIn?

Reid Hoffman, a venture capitalist and renowned American internet entrepreneur, founded LinkedIn in 2003 with an aim of linking professionals globally.

The website launched its mobile version in February 2008 whereas; Microsoft bought the company for $26.2 billion, 8 years later, in February 2016.

linkedin business model

LinkedIn works on the same model as Facebook; the professionals send requests to connect with each other.  The users, both the employers and job seekers, post jobs and resumes for job purposes.

Ironically, despite being one of the fastest-growing social networks, LinkedIn remains an unknown medium to many across the globe.

Over 106 million active monthly users, utilize the platform for building their personal as well as corporate brand online.

Over 9 million companies post jobs in the community, thus, linking several recruiters with potential candidates. The platform also allows users to express their thoughts in the form of blogs on LinkedIn Pulse.

LinkedIn Business Model

Unlike Facebook and Twitter and other social networks, LinkedIn offers premium services. These services are often availed by the users in exchange of fee for enhancing the professional networks.

LinkedIn is a useful platform to connect professionals with companies and recruiters.

How LinkedIn Business Model Generates Revenue?

 Advertising is the highest means of generating revenue for most of the social networking websites; the LinkedIn business model is different.

 The revenue model of LinkedIn falls as:

  • Premium Subscriptions
  • Business Solutions

Premium Subscriptions

The premium plans are user-specific. The premium subscriptions offer premium solutions different to ordinary users.

The subscription include

  1. Recruiter Lite
  2. Career
  3. Sales Navigator
  4. Business Plus

Recruitment Solutions

linkedin business model

Recruitment solutions is a lighter version of Talent solutions. The premium solutions offers integrated hiring, smart suggestions, automatic candidate tracking, usual features like inMail messages, recruiting-specific design etc.

Career

A premium career account offers you numerous career solutions. It allows you to compare your profile with others, have access to applicant’s insight, a wider reach and deep visibility. The account offers salary insights, access to online video courses and recognizing the profile viewer.

Sales Navigator

Sales insights, lead recommendations, saved leads, leader builder and InMail are various tools offered by LinkedIn premium sales solutions that help to boost social selling strategies.

Business Plus

The premium version offers more detailed career and business options. Moreover, the premium business accounts offers you access to unlimited suggested profiles and profiles search. Accessing the features of InMail, allows connecting with anyone on the LinkedIn, even with those you are not connected with.

Partnerships & Acquisitions:

By means of various acquisitions, LinkedIn has expanded its business model.

SlideShare

LinkedIn acquired Slideshare in 2013, with an aim of allowing the members to discover people via content.

The users can upload content publically or privately in OpenDocument format, keynote, powerpoint, PDF in LinkedIn Slideshare, a slide hosting service.

LinkedIn Learning

LinkedIn has recently acquired Lynda, an eLearning platform. Based on a subscription-based revenue model, Lynda is a platform that allows users learn creative skills, software, technology and business via videos.

The Talent Solutions Business is the largest segment of LinkedIn. Presently, it generates nearly 62% of the revenue. LinkedIn Career Pages, LinkedIn Recruitment Media, Job Slots, LinkedIn Recruiters are the primary products offered by the Talent Solutions. Presently, the company has nearly 34,000 user base in the important segment.

LinkedIn Business Model Monetization

LinkedIn generates some money by offering additional services on a subscription basis to its normal users. They are usually job hunters and salesmen trying to connect with people they don’t know.

Moreover, pay per click or pay per view is the other sources of monetization. Also, corporations and recruitment companies pay to establish a strong branded presence on the site for recruitment purposes, to search the database for talent and for the ability to post jobs.

Key Activities in LinkedIn Business Model

Platform development is the key activity for LinkedIn. The number of active users on monthly basis, their activeness and engagement is crucial to LinkedIn, and hence it needs a platform to achieve the objective.

Therefore, platform is the key source for the LinkedIn business model. Other features like, branding, staff, value adds and many of the monetization channels are not essential and useless without the platform.

How Is LinkedIn Business Model Different?

linkedin business model

LinkedIn is a legit social networking platform where users utilize their connections for establishing professional contacts.

The LinkedIn business model, unlike other social networks, does not entirely depend on advertisements; rather, it has various other useful means. Hence, all these features together make the LinkedIn business model as the best model with the strongest monetization strategy.

The company sells the information and data of the registered users to the recruiters to help them find a suitable job.

Furthermore, LinkedIn offers hiring efficiency to the companies, and, facilitates business-to-business advertising. With its growing presence in the professional world, LinkedIn brings much more to the table for users than its casual peers.

LinkedIn business model is the best in social media—because it does not rely on advertising. The advertising market can be fickle at times; hence advertising business models might not always be the most attractive or sustainable in the long run.

Moreover, LinkedIn has a platform related to skills development and education. And, with paid advertising campaigns, users can sponsor products or services. Hence, it is a strong platform for various reasons.

Precisely, LinkedIn serves different target customers who are highly dependent on each other. The overall value of the platform lies in offering services for both the hands of the professional industry:  HR managers and the professionals. It helps to link job seekers with employers. Hence, LinkedIn could be defined as a multi-sided platform.

LinkedIn has a majorly subscription based yet diversified business model.

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