LinkedIn has lost its Vision
A few years ago, I worked at LinkedIn. At that time Reid Hoffman had a very clear vision for LinkedIn.
LinkedIn was “Resume 2.0” for the middle managers and the professional individual contributors who really make businesses function. LinkedIn would enable those people to highlight and show off their abilities.
Through LinkedIn, outside recruiters would see the LinkedIn members’ professional competency. The invisible professionals would get more economic opportunities.
LinkedIn members were members to be helped, not users to be exploited. This was a unique social bargain, unmatched by any other social network. LinkedIn members would keep their professional profile updated with their performance and skills. In exchange, LinkedIn would use that profile to help the members find new and better opportunities.
LinkedIn also built a member’s professional network: LinkedIn became a place to do reference checks in a quiet way. A place to find people without posting a job. A place to do business. A LinkedIn profile became a professional necessity: an electronic business card.
LinkedIn became the dominant business social network to conduct business.
In exchange, LinkedIn would then sell access to those members’ profiles to recruiters looking to hire the professionals. A win-win for all.
For a many years LinkedIn enjoyed their success with rich stock P/E multiples.
Earlier in 2016, LinkedIn lost its bloom. A year ago LNKD was at $269, today it is at $110. What happened?
LinkedIn has forgotten the unique “fuel” that powers the money machine: the members and their willingness to keep their profile up to date.
This exchange I had with a college senior is typical:
But is more telling are these snapshots from LinkedIn’s own employees:
LinkedIn’s own employees don’t see the value of updating their own LinkedIn profile!
Amongst my friends, the general attitude for not updating their LinkedIn profile is one of the following:
- “I am not looking for a new job”
- “I am looking for a new job, but I don’t want my manager to know I am looking.”
- “Or I just got a new job, and I don’t know if it is going to work out so I am not putting it my profile until I know that it will.”
Which then leaves the very pointed question: “When exactly will someone update their LinkedIn profile”?
Remember an up-to-date profile is the LinkedIn’s key asset that powers LinkedIn Talent Solutions:
62.5% of LNKD’s revenue depends on members keeping their profile up-to-date.
Outside recruiters still use LinkedIn as part of their recruitment process, however in-house recruiters that I have talked to get better results with Indeed.com. With Indeed.com, recruiters know a person is actively looking, the resume is actively updated, and there is much more detail when compared to a LinkedIn profile. (Please note: I am a LNKD shareholder and I have no financial interest in Indeed)
If LinkedIn was demonstrating its true potential, the resume would be a subset of the LinkedIn profile. And Indeed would not be valuable to recruiters.
LinkedIn’s misaligned focus
Yet, LinkedIn’s focus is on… Sales Solutions and the Talent Solutions.
Lets take a look at the Sales Solutions product. Sales Solution depends on members having a quality network. It depends on members willing to keep their important business connections in LinkedIn.
With Talent Solutions and the members’ profile, the promise was members will get better jobs, more career advancement opportunities and more money — a direct, measurable, economic benefit to the members.
LinkedIn over the years has become a business card proxy. LinkedIn users hand out their Linkedin member url at conferences. They connect to people that they may not have an actual business relationship. Over the years, the LinkedIn network accumulates with people that are little more than distant memories.
There is even less value to members to prune and update their network. LinkedIn offers minimal tools to members to annotate and get personal value from the LinkedIn member information. For me personally, I have to refer to my email history to figure out how and why I know a person in my LinkedIn network.
And now in 2016, LinkedIn wants to sell access to members network with Sales Solutions. Sales Solutions’ benefit to members is the opportunity to be lukewarm called instead of cold called.
This is not an incentive for members to use LinkedIn — they are now being a product that is being sold.
LinkedIn forgot to ask: what is the economic value to a member to keep their network up-to-date?
What LinkedIn needs to change: Future focus
As of today, members’ LinkedIn profile is all about the past: past job titles, past companies, past education.
What is completely missing is any sense of the future. As they say in the stock market reports, “past performance is not a guarantee of future results” What a LinkedIn professional has done in the past is not a guarantee of what they see in their future:
- Is the member looking for new opportunities?
- Does the member want to change careers?
- Move to a new city or country?
- Does the LinkedIn member want to move from the corporate world to teach at a university?
- Starting a company that combines professional skills with a hobby: Develop software for sailors? Or start a chain of swimming schools?
LinkedIn does not help members prepare for the future:
- What skills does the member need within the next 5 years?
- Is the member at risk because they are stagnating with regards to experience?
- Which of two different job opportunities are more likely to pay off?
- What skills are needed to make a career change?
Not eating the dog food
You may agree or not agree with me. If you choose to disagree, you need to ask and answer the “dog food” question.
Fundamentally, LinkedIn needs to look to their own employees and ask:
Why is your LinkedIn profile allowed to decay and be a mere skeleton?
In startup land there is the term: “Eat your own dog food” — Or prove that your startup’s product is valuable by using it internally.
If LinkedIn’s own employees’ don’t find LinkedIn valuable — investors are right to question LinkedIn’s value as a company.
(cross posted at my own blog: http://sworddance.com/blog/2016/03/26/linkedin-has-lost-its-vision/ )