Home›Blog› Social Media

Social Media

LinkedIn has the best social demographics ever…now what?

Posted by Jared Stivers on November 23, 2009 at 10:44 AM PDT

The “great demographics - now what” part of the LinkedIn equation has no doubt been kicking around at company HQ for quite a while and yesterday they answered part of the question by announcing Custom Groups. Unlike the free LinkedIn groups that crowd your inbox with updates, Custom Groups are more feature rich, allows a company to control the content and are a long way from free. $50,000 from free to be exact, but is it worth it?

I think so; Custom Groups is a good idea for a few reasons. Number one is obvious: they have to do something to monetize the affluent audience of 50 million members. Simply sitting on all of this valuable traffic and throwing up some display ads is not how this company is going to grow and profit. If there is anything we’ve learned from Web 1.0 it’s that revenue is important and revenue growth keeps you in business.

Secondly, I think there is a real demand for this especially from larger companies wanting to dip their toe in the social world without sacrificing total control of their brand experience. Too often I’ve seen companies who are seen as innovators completely ignore social media because of the risks. While this is rapidly changing it’s hard to believe anyone who has spent years of effort and millions of dollars on a brand would want to simply give it to the blogosphere. With this announcement from LinkedIn someone such as IBM, a beta customer not known for sitting on the cutting edge, can tap into some of the potential the social world offers while mitigating some of the risks.

Part of the $50K price tag also get’s you the traditional display ad’s that we’re used to seeing. And although no one ever clicks on those the advertising folks will no doubt make a convincing argument that it was “brand building” (which it probably is). LinkedIn is also tweaked these displays to allow for users to see something other than smiling faces sitting around a laptop looking satisfied with a Microsoft logo somewhere. These new ads will allow companies to push out an RSS feed, blog posts or Tweets and in an interesting twist allow users to customize the type of content they want to see. A good idea for sure but as we’ve gotten so good at ignoring display ads we’ll see where it goes.

But back to Custom Groups.When you think about who is going to really benefit from these, as in the size of the company (read large) and the marketing budgets that go along with these companies, $50,000 is starting to look like a pretty good deal.

I’m thinking of companies like the two beta customers announced, Intel and IBM, seeking a B2B audience and selling products with a substantial lead time. Speaking directly to the decision makers who are pivotal in the purchase cycle is not easy; asking them to come to you is even trickier. Intel and IBM are taking an important first step by putting themselves where they know these elusive senior IT managers are.

Custom Groups is for sure a good idea both for LinkedIn and for large B2B companies but there is one more critical question: will it succeed? It will, but if and only if companies do not treat it like a corporate microsite but rather a social platform that is nurtured and maintained. A conversation is a two way street; it should be dynamic, fluid and ever-changing. Even better if these companies take it seriously by previewing products, solicit feedback and solving problems. If not, then congratulations, you just bought a $50,000 brochure.

Return to the top.