LinkedIn: Not Just Professional Growth
The Optimal Trajectory
Founded in 2002, LinkedIn is a social media platform focused on increasing productivity and career success for its users. With over 645 million users on the platform, including top executives from every Fortune 500 company, it is the world’s largest professional network. However, despite LinkedIn’s growing importance in the development of millions of career paths, the company still has plenty of opportunity to grow.
As a company, LinkedIn’s business model closely resembles a hybrid between typical talent acquisition companies and other social media platforms. The company’s revenue streams are threefold: Premium memberships (17 per cent of 2016 revenue), advertisement sales (18 per cent of 2016 revenue), and paid job postings (65 per cent of 2016 revenue). The revenue from advertisement sales and paid job postings depends on a large and highly engaged customer base. To continue capitalizing on growth, LinkedIn should focus on a demographic that not only has a high engagement rate with LinkedIn’s content, but will also serve as a foundation for long-term value.
University students are the perfect target demographic for LinkedIn to focus on. They are the newest entrants to the job market and, as a result, do not have an existing professional network to rely on. This increases their dependence on LinkedIn for seeking job opportunities. In addition, their age cohort represents one of the most active demographics on social media, and they are less likely to already have Premium subscriptions relative to older professionals with higher disposable incomes. Getting students accustomed to LinkedIn Premium features helps create a pipeline of future Premium subscribing adults who will then turn to LinkedIn for recruiting, advertisement, and mentorship as they progress through their career.
A Lifelong Engagement
To accelerate growth and maintain dominance in the professional network space, LinkedIn should pursue partnerships with post-secondary institutions, giving all enrolled students a free Premium membership. The structure of these partnerships would be similar to those held by LinkedIn Learning (previously Lynda.com), which provides free professional skill tutorials to students at a broad set of higher educational institutions. This program would establish a pipeline of students accustomed to LinkedIn’s Premium offerings who will elect to purchase the full Premium subscription post-graduation and stay engaged with the platform.
The Premium subscription service for students should be given a different name and icon design to distinguish student-Premium users from full-Premium subscribers. This is because, to many, LinkedIn Premium functions as an exclusive club and a signal of professionalism. A massive influx of students with faux-Premium accounts would erode the social value of standard LinkedIn Premium subscriptions. A separate class of Premium would still leave students with all the benefits LinkedIn Premium has to offer, but not alienate current Premium subscribers. Students with prior Premium subscriptions could choose to either switch to the free student membership or continue their full-Premium plan.
A student Premium subscription could also offer slightly different benefits relative to full-Premium, to better accommodate the unique needs of students. As an example, additional InMails above the five per month allowed in the Basic membership could have greater benefit to students starting the recruiting process, whereas salary estimates may be less relevant for entry-level positions with publicly available compensation figures.
To prove value to universities, LinkedIn should create an analytics dashboard that career management staff can access to monitor student engagement and job status in the recruiting process. This can be done with a variety of metrics including the number of new connections, InMail messages sent, job postings applied to, profile views, and job status updates. This would not only allow existing career management services to pinpoint areas of improvement for students, but also improve the granularity of job placement analytics. Even if overall full-time hiring rates remains flat, if it could be done with half the applications relative to those students not using LinkedIn Premium, that would still represent a better student recruiting experience. Since universities–and in particular, their business schools–are publicly ranked on the basis of career outcomes, the job-hunting benefits. LinkedIn Premium provides could boost student full-time hiring rates and help participating universities bolster their reputation.
The Inner Workings
Premium features will be immediately available to any LinkedIn account with an associated university email upon user submission of a recent proof of enrollment. On an annual basis the Premium access will be removed, and the user will be prompted to submit updated documents. It is expected that increased capabilities on the platform will improve engagement for affected accounts, consequently boosting revenues from advertising and job postings. New graduates are also the demographic that is most prone to switching job positions, with a median tenure of 2.8 years, compared to 4.9 years for adults aged between 35 to 44. As students become reliant upon the superior services offered by LinkedIn Premium, they will be more likely to renew their subscription when pursuing these new positions.
As the student populace becomes more dependent upon services offered through a Premium subscription, LinkedIn can leverage their employment data and job offerings into a full integration for university career management teams. Through an annual subscription fee, a given university will have access to dashboards containing data about all current students, as well as details on their alumni network. The analytics pertaining to current students will detail where each student has applied, where they have received job offers, and their full employment history, thus assisting career advisors when giving advice in one-on-one meetings. The alumni dashboard will allow the faculty and staff to search and InMail (LinkedIn’s messaging service) any user who has listed the university as their alma mater. This can result in further engagement of alumni in on-campus activities with current students, potentially strengthening employer relations and increasing the likelihood of student employment. Schools with the largest base of students actively engaged in other paid offerings, such as LinkedIn Learning, should be targeted for these services first, on account of their demonstrated propensity to adopt new technologies and pre-established trust with the brand.
Github, a software development platform, pursues a similar strategy to target students. Since 2013, the company has offered their Student Developer Pack (SDP)—a bundle of development tools—at no cost to students with proof of enrolment. This pack enables students to pursue their interest in learning about software development without incurring high costs. At the same time, it exposes Github’s paid features to the demographic that is most likely to require them in the future–similar to what is being proposed for LinkedIn. Github’s SDP has been wildly successful, with over 1.5 million students registered and a constantly growing bundle of tools. The SDP is part of the reason Github currently holds the position as the world’s largest software development platform, with over 40 million users and over 85 million code repositories.
Upwards and Onwards
The strategic decision to pursue partnerships between LinkedIn and educational institutions holds strong promise to drive further engagement and a higher quantity of users on the platform. Doing so contributes to growth in all company revenue streams and contributes to LinkedIn’s network effect between recruiters and job seekers.
Future expansions to the partner program could include partnerships with professional degree institutions, like law schools and medical schools. Students pursuing both degrees have their own extensive and highly competitive recruiting processes, and the universities offering them are evaluated on future job prospects, making them a natural next step. Once these well-matched options have been exhausted, a broader implementation to general undergraduate programs can be pursued, but such a move would be contingent on the efficacy of the partnerships with institutions best suited to the program. The outlined strategy should cement LinkedIn’s position as the best platform for professional development and social networking for early-career users and help thousands of students realize their full potential.