A LinkedIn exec explains how the company will hit $2 billion in ad revenue this year, and why it's betting big on video
- LinkedIn says it will make $2 billion from its media business that sells advertising in 2018, primarily from sponsored content.
- The platform has redesigned brand Pages with more tools and analytics to help brands build a following on the platform.
- Video in particular is growing, and 50% of LinkedIn members see a video in their feed daily.
LinkedIn wants to be the go-to platform for brands to talk to both employees and potential hires, and it's rolling out a bunch of new tools to help them.
As of Tuesday, admins to Pages can now manage their accounts and respond to comments through LinkedIn's mobile app. They can also now plug into hashtags to target specific keywords, and use a new feature that pulls in trending content they can use to target their own content.
LinkedIn announced that it has 590 million members, more than 30 million Company Pages, and generates more than 2 million pieces of content in its newsfeed every day. Video in particular is growing, the company said, and 50% of members see a video in their newsfeed daily.
LinkedIn's revenue from advertising is small but still growing.
During a press event on Tuesday, Tomer Cohen, VP of product at LinkedIn Marketing Services, said that LinkedIn's media business that sells advertising will hit $2 billion in revenue this year.
To compare, Facebook made $13.7 billion during the third quarter of 2018, while Google pulled in $27.2 billion. Amazon, which many industry observers say is an emerging threat to the duopoly, made $2.5 billion from advertising during the third quarter, up from $2 billion in the first quarter of 2018.
Business Insider talked with Cohen about LinkedIn's ad business and how the company sees brands using its platform.
Lauren Johnson: LinkedIn is expecting $2 billion in media revenue for 2018. How does that break down between sponsored content and video?
Tomer Cohen: We don't break it down [but] sponsored content is our dominant advertising unit. It's propelling our newsfeed engagement.
Johnson: Video has also been growing on LinkedIn. How does engagement with video compare with text?
Cohen: More than 50% of members on LinkedIn see a video in their feed on a daily basis. We just launched video several quarters ago on the consumer side, and two quarters ago on the advertiser side.
Members want to express themselves [with] video. Video on the advertising side is growing extremely fast as well. In a way, it talks to the diversity of what you can do. Brands aren't limited to text or one single photo.
From a consumption [perspective], members really engage with video and love the format and find it really appealing. The engagement there has far exceeded our expectations.
It's still early days for us with video, but it's a very strong start.
Johnson: How are you seeing brands using LinkedIn?
Cohen: We have north of 30 million pages on LinkedIn today. This is businesses, enterprises, small businesses, schools, nonprofits, universities, and so on.
We completely redesigned the experience from scratch really focusing on that notion of what makes a business successful. It's coming as part of the momentum of our consumer ecosystem. Our members are coming to Linkedin more frequently right now and are looking to engage with businesses on LinkedIn.
Businesses want to connect with those communities - whether it's for hiring purposes, for selling purposes, for partnering purposes [or] to excite and their own employee base.
We've been working on this for several quarters and it sparked a whole new thread for us, which is reinvesting in this experience and building it to where the future is.
Johnson: What consumer-facing brands do you see beefing up their presence on LinkedIn?
Cohen: If you look at, for example, Airbnb. They make their people announcement and introducing their new CTO to their employees. You can see colleagues and employees congratulating him on LinkedIn.
That happens a lot on LinkedIn. Everything from Walmart announcing new offices in Austin - members are asking for opportunities to work at Walmart - to nonprofits and all the way to Gates Foundation.
When brands do it, you're basically seeing the convergence of corporate brand and talent brand coming together. The focus is that there's one brand. My brand could be talking to my customers, but the same post could be appealing to my employees and it could be appealing to talent in the future.
The companies that do this well are able to propel those communities and be very effective for them. You can get reach data and the LinkedIn graph to show who you're reaching and the impact that you're seeing there as well.
Let's say you're able to find out that you're engaging a certain segment - like Walmart wanting to open an office in Austin, and they want to hire people there. They can go and use our tools to see what do folks in Austin care about and then share to those specific segments what they care about most.
Johnson: How is that different from how brands think about communities on Facebook and Twitter?
Cohen: It's always about the professional mindset and making people more productive and successful professionally. If we take the example of Tesla and sharing their innovation, you're trying to spark a notion of great topics around innovation. At the same time, you have employees saying, "I'm proud to work at Tesla. Look at what my company is building," that they share with their own network.
People ultimately want to want to buy from companies who have great culture, great products, and they feel that they're connected to their value system.
By being able to share it on LinkedIn, you're able to reach all of those communities and know who they are because you have professional identities, and you're able to measure your reach so that you can better cater your messaging and creative going forward.