With corporates across the globe going slow on hiring, the one firm which should have been impacted is Linkedin. A quick look at the company’s third quarter numbers tells a different story.
LinkedIn has not only been able to increase its membership base to 187 million globally but it has seen a steady increase in its revenue from talent solutions, marketing solutions and premium membership.
Deep Nishar, senior vice president, products and user experience, LinkedIn agrees that ideally hiring should have been slow keeping in mind the global economic scenario, but LinkedIn has not seen the impact. “Hiring is at an all-time high, especially when it comes to corporates using our solutions. Since we are still in the early stage of our way of business, and our market we will continue to see disproportionate growth. But the older way of doing hiring is definitely slowing. Besides for us as a company the velocity of product innovation has been one of the highest for us,” he added.
LinkedIn, that adds a member every two seconds, reported revenue of $252 million for the quarter ended September 30, 2012. While talent solutions continues to be the biggest chunk of its revenue, at $138 million it grew 95% year-on-year, revenue from marketing solutions grew 60% to touch $64 million for the third quarter or 25% of its revenue.
Nishar is excited about the preference among corporates to use LinkedIn as a marketing and branding platform. Take the instance of Woodland India, the outdoor and adventure wear brand. Woodland started a campaign called 'Step out 2 go pro planet', for launching its biodegradable range of footwear.
“LinkedIn has a focused user group, and that is professionals. The moment I said we should also use LinkedIn there was huge reservation, as our target audience has been the age group of 18-25 years-old. But I felt that this could be an extended target group. The results were amazing. Within a few days we had over 100,000 people interacting, lot of companies also participated,” said Amol Dhillon, VP strategy and planning, Woodland.
Dhillon agrees that the campaign did help in creating awareness and traffic to the pages. “It's very difficult to measure the exact immediate effect of any advertising especially a theme based campaign, where objective is more to position the product line in the right space. We were able to sell about 300 pairs of the new product line through e-commerce platform over the period of the activity and there was a surge of online orders for other products as well during the period,” he said. The campaign began on June 5, 2012 and went on till August.
Automobile manufacturer Volkswagen India is another company that chose to work with LinkedIn to create awareness for its new launch. Volkswagen wanted to target the professional population with the campaign as it felt that car effect’s the professional life and a user’s professional identity helps car choice.
Volkswagen launched a series of recommendation ads encouraging more customers to join the conversation. Each ad showcased endorsements of actual LinkedIn members, and invited the community to recommend their favourite Volkswagen model. The company was targeting to get 500 recommendations. “In less than 30 days, over 2,700 Volkswagen fans had stepped forward to recommend their favourite cars and share these recommendations with their professional networks. In the same time period, we gained over 2,300 followers who asked to stay abreast of the latest news and developments from Volkswagen,” said Lutz Kothe, Head of Marketing & PR, Volkswagen Passenger Cars.
“Other than company pages, we also allow clients to own micro sites. The advantage with LinkedIn is the company know the identity of the individual. So they know who they are interacting with, so when they do contest etc. they are using know who that individual is, and second is the power of virality,” added Nishar. Another feature in its marketing solutions is creation of sponsership group. "For instance, Citibank has created a group for working women and the kind of discussion it has attracted on this has been amazing. Women from all walks of life participate. For Citibank this is huge as it owns this space," explains Nishar.
The company’s global growth story is also reflective in India, which is one of the fastest growing regions with 17 million users. Ask Nishar about why corporate prefer to invest with LinkedIn and he is quick to point the value that his company offers, especially the return on investment (RoI).
“Over the years corporates that have worked with us have found that the costs of finding a quality hire goes down over the time. Corporates have found their RoI’s are better when they hire from LinkedIn,” added Nishar.
According to a survey conducted by LinkedIn, about 44% of people who said they are not looking for a job, reply to a company’s call if it is the right opportunity. LinkedIn classifies them as ‘Explorers’. These are candidates waiting for the right opportunity and Nishar believes that LinkedIn provides access to such database.
“When I say the RoI is higher it based on a) with 187 millon professionals, and 17 million in India, we have pretty much everybody on the network, b) they are not coming here to look for a job but to keep their profile updated, c) they are engaging to provide professional value, and d) they are now making themselves available to the talent recruiters from different corporates who have our solutions. So your time to find talent goes down, recruiters have direct access to the talent and the ability to get their response is shorter. More importantly, since you are paying for software, for which you might pay $8000 per year per recruiter, it is much more lower than 30-40% of the salary of the executive that you might have to pay up to an executive recruitment firm,” said Nishar