LinkedIn ISMP Presentation
- 2. Table of Contents S 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
- 3. Executive Summary S 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. S Marketing Solutions makes up 20% of company revenue and is projected to have the highest growth rate out of any of their other segments, S 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. S 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. S The increasing migration to mobile activity over desktop proves the viability of this plan, increasing revenue in every quarter by 19%. S 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. S By executing these strategies, financial targets should be set at: S Net revenue: FY2015- $2.924B S Net income- FY2015- $2.230B
- 4. Industry/Market Analysis S Industry Definition: Online Recruitment Sites acquire revenue through offering job listing services as well as ad placement space. S Searchable database to source job postings S Archive resumes and profiles S Numbers at a Glance S $3.4B industry S Growth rate of 14.4% S Expected annual growth rate of 7.3% for the next five years S Industry Trends S Low unemployment less job postings S Platform traffic originating from mobile devices
- 5. Industry/Market Analysis S Trends (Continued) S Existing businesses to increase workforce S Growing talent gap companies competing for highly skilled candidates S Candidate tracking and talent strategy development S Total number of businesses in US will grow by 1.6% S Legal/Regulatory Issues S Lawsuits S Security breach in June 2012 S LinkedIn user passwords posted on Russian hacker site S Harvesting e-mail addresses without permission S Spamming people to join the network
- 6. Competitors S LinkedIn Career Builder Inc Indeed.com Monster.co m Core Products Premium Subscription sHiring 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 Billion 30.7% $556 Million 17.7% $434 Million 14.1% $770 Million 12.6% Holding Company Public Private Private Public Strengths Social media platform, Software strength, Largest user base Data Analytics, Present in 20 countries Supply/dema nd portal Aggregates job postings from all sites Accounts for 54% of online hires Sophisticate d algorithms Twitter partnership Weakness es Privacy issues Too much focus on HR Saas segment Pay-for- performance business Undergoing significant restructuring
- 7. Facebook Twitter LinkedIn Core Products Personal profiles Instagram Messenger WhatsApp Messenger Website/Mobile app Gnip Premium Subscriptions Hiring Solutions Marketing Solutions Annual Sales Revenue/ Market Share $12.5 Billion 65.4% $1.8 Billion 16.2% $2.21 Billion 15.1% 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)
- 8. Value Chain Suppliers Distributors Retailers CustomersManufacturer Suppliers Customers Computers for employees (Apple, Lenovo) Members Construction personnel for office spaces Businesses Third party interior design companies Consultants Food suppliers for cafeterias Enterprises Contract companies (Ex ZeroChaos Workforce Logic) Contractors (non full-time employees) Employee salaries Employee Benefits (Health, 401K) Cleaning services Docusign HR services (Background check companies)
- 9. Value Chain Continued Suppliers Content Providers – job postings, resumes, etc. Suppliers Materials, Food and Equipment LinkedIn Corporation – includes all personnel and functions performed in-house Digital Website/ Mobile Apps Customers
- 10. Customer Analysis S Customer Needs/Preferences S Quality content so members can stay informed about opportunities for career improvement S Content shared through features like SlideShare S Sophisticated database to help businesses find top candidates S Efficient software that businesses can use to market products and create a pipeline of leads S Easy-to-use mobile application for both customer segments S Mobile constitutes 45% of online traffic; exponentially growing S Customer Segments S Primary: Businesses who purchase SaaS (Talent Solutions 60% of revenue, Marketing Solutions 20% of revenue = 80%) S Secondary: Members (free profiles, Premium Subscriptions)
- 11. 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 Platinum Gold Iron Lead Businesses Members Semi Active Free profile members Passive Free profile members
- 12. Company Analysis S LinkedIn’s was founded and headed by Reid Hoffman in 2002 S 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 S 1,000,000 members and and introduced their first business lines: Jobs and Subscriptions S 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 S Went global in 2008 with the opening of first international office in London and launching Spanish and French language versions on the site S Jeff Weiner becomes CEO in 2009 and brings focus and clarity to LinkedIn’s mission, values, and strategic priorities S By 2010 they had 90,000,000 members and in 2011 became a publicly traded company on the New York Stock Exchange S In the decade on LinkedIn’s existence, they acquired 225 million members and growing at a rate of two members per second
- 13. Company Analysis S Key Statistics S Number of product lines: 3 (Hiring Solutions, Business Solutions, Marketing Solutions) S Number of employees: 8,700 S Number of countries where products sold: 200 countries S 2015 Expected Revenue: $3.0 Billion, Profit: $2.6B S 2014 Revenue: $2.2 Billion, Profit: $1.9B S 2013 Revenue: $1.5, Profit: $1.3B S Acquisitions S Pulse S SlideShare S Lynda.com S Bizo
- 14. Company Analysis-Positioning LinkedIn Position: 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
- 15. Company Analysis- Core Competencies S Positioning: Offers the largest professional social networking site in the world S Massive amounts of data • Quality Software • Service Development
- 17. Perceptual Map for Social Networking Industry Low member count Amateur Professional High member count
- 18. Perceptual Map for Online Recruitment Industry High # of Diversified Products Low Member Count High Member Count Low # of Diversified Products
- 19. Marketing Mix Brand Premium Subscriptio ns Talent Solutions Business Solutions Marketing Solutions Product Job Seeker Recruiter Recruiter Lite Job Slots Job Posts Career Pages Work With Us Ads Sales Navigator Business Plus Lead Accelerator Sponsored Updates Sponsored InMail Display Ads Text Ads Place Online Online Online Online Price $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
- 20. SWOT Analysis Strengths • Large Network: #1 professional social networking site in the world • Diversified Revenue Sources • Recent Acquisitions Opportunities • 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
- 21. Expanded SWOT Maximize 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
- 22. Recommendations S Primary Recommendation S Integrate existing Pulse and SlideShare mobile applications into LinkedIn’s core mobile application S Modify Pulse and SlideShare’s viewing capabilities to fit into LinkedIn’s app for seamless content generation and engagement S New product offering must be easy to use and have minimal bugs S Sponsored Ads and Display Ads must be present and prevalent S Update the Recruiter application to allow other kinds of business personnel to conduct B2B activities S Allow application to monitor and track ad reach to enable modifications for real time changes S Make instant sharing of B2B activities visible to other company employees S Financial Objectives S Net Revenue for 2015: $2.924B S Net Income for 2015: $2.230B
- 23. Recommendations-Value Chain Suppliers Content Providers – job postings, resumes, etc. Suppliers Materials, Food and Equipment LinkedIn Corporation – includes all personnel and functions performed in-house Digital Website/ Mobile Apps Customers
- 24. Recommendations-Target Customers Platinum Gold Businesses Consumers Companies that Utilize Talent & Marketing Solutions B2B Marketers that use apps regularly Small Companies Employees that check their apps regularly Premium Subscribers Active Pulse and SlideShare Users Very Active Free Profile Members Minimally Active Pulse & SlideShar Users
- 26. Recommendation-Metrics of Success CUSTOMER PERSPECTIVE • 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 AND LEARNING PERSPECTIVE • 2 NEW APPS • 1 LINKEDIN CORE APP • 1 UPDATED RECRUITER APP • 90 DAY BETA TEST • EDUCATIONAL TRAINING FOR SALES DEPARTMENT
- 27. Recommendations- Marketing Mix S Primary and Secondary Targets S 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 S 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 Promotion Objectives 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
- 28. Most Likely Projected Profit & Loss Statement
- 30. Contingency Plans S Contingency plans if objectives are exceeded S Pulse and SlideShare Integration S Increase number of integrations to other apps like Sales Navigator S Offer app in international markets abroad S Recruiter app update S Spend more money on researching other B2B needs worth offering S Increase money on advertisement and promotion Contingency plans if objectives are not met S Pulse and SlideShare Integration S Analyze interface and decide how to improve upon it S Scale back expansion plan S Recruiter app update S Reassess marketing campaign and research more targeted business methods S Decide whether integration should be deleted and go back to normal
- 31. SAppendices
- 33. Source: comScore, Wells Fargo Securities, LLC
- 34. Source: LinkedIn Company reports, Wells Fargo Securities, LLC
- 35. Source: Company Data, Brean Capital Estimates