Linkedin - Vision, Value Proposition and Business Model

Vision, value proposition and business model

LinkedIn’s vision is to create economic opportunity for every professional in the world. This vision not only applies to each of their employees, but every LinkedIn member, each of whom has the ability to create economic opportunities for others. LinkedIn believe this is the fundamental power of their network. [1] Unlink other social networking sites such as Facebook, Google+ and Twitter, LinkedIn focused on connections within the professional market. The site allowed individual members to manage their professional profile, publish their experiences and skills, join the professional group, search firms and people, and find potential job opportunities.

The value proposition of LinkedIn focus on three points. First of all, identity, LinkedIn want to encourage people to show their experiences, skills, and career ambitions via LinkedIn profile. Then, LinkedIn will become the big database of human resource. Second, insights, people update their LinkedIn profile even when they are not searching for a job, so LinkedIn can utilize this data to provide services. Third, everywhere, LinkedIn does not expect their user always to stay in front of the computer, or only be able to generate profit from LinkedIn.com website, LinkedIn more focus on mobile technology and release their API that many third party applications will bring more business opportunities.    

LinkedIn generate revenue in three categories. Hiring Solutions. Enterprises and professional organizations use Hiring Solutions to identify job candidates using industry, job function, geography, experience, education, and other qualifiers. LinkedIn had a dedicated sales force that sold this service directly to enterprise clients. This segment represented 50% of LinkedIn’s revenue in 2011. [2]

Marketing Solutions. Revenue from marketing solutions consisted of fees earn from marketers and advertisers for display and text ads on the LinkedIn web site. LinkedIn sold its marketing solutions products through its field sales organization and also through a self-service offering online. This segment represented 30% of LinkedIn’s revenue in 2011. [2]

Premium Subscriptions. Premium subscriptions were primarily derived from members who use LinkedIn’s range of subscription products. These offerings were sold online, on a monthly or annual basis, and allowed members more search, communication, organization, and customer support features than were available through the free membership. This segment represented 20% of LinkedIn’s revenue in 2011. [2] 

Business activity and positioning

LinkedIn’s core services are mainly based on the social activities of professionals, with network platform, anyone can join membership or be invited by existing members. After joining LinkedIn, you need to edit your own profile like education, experience, skill, and special achievement, then, you can begin to build relationships (connections) with other members.