There are possibly more Indians on online professional network LinkedIn than Britons, Germans, Austrians, Swiss and Australians combined. The only country that has more users on the platform is the United States.
It was with a bit of luck, of the sort that its users often hope for, that LinkedIn made its dramatic debut at the New York Stock Exchange in May, even as critics questioned the firm’s fundamentals, while others were reminded of the ‘90s dot-com boom.
In what was the biggest initial public offering for an internet company since that of Google in 2004, LinkedIn raised about $352 million from investors and saw its stock more than double on the first day of trading, settling with market capitalisation of over $7 billion.
The company’s revenue stood at $243.1 million last year, with net income of $15.4 million – numbers that some observers noted with interest.
Since May, LinkedIn has posted steady growth. For the quarter ended June 30, revenues reached $121.0 million, a jump of 120 per cent compared with $54.9 million in the corresponding quarter of the previous year. Overall, the company expects to end the year with revenues of $475-$485 million.
At the same time, membership at the online platform has now reached 120 million, a rise of more than 60 per cent over the second quarter of 2010, with 81.8 million unique visitors per month.
And, interestingly, India has been at the heart of the action.
LINKED INDIA
“From 3.4 million members in November 2009, we have now grown to more than 11 million members in India,” said Arvind Rajan, LinkedIn’s managing director and vice-president (Asia Pacific and Japan), said, “We have seen growth acceleration in Q1 and Q2 this year. It’s been turbo charged after the IPO”.
LinkedIn is fourteenth-largest website in India, in terms of page views, according to comScore, an internet marketing research firm, with 6.02 million unique Indian visitors to logging into the platform in August. “People are surprised at how big LinkedIn is in India. Not only are users going there on a very regular basis, a lot of them are tending to use it as a utility. There has been a change in behaviour over the last six months,” added Rajan.
With its three major revenue streams — hiring solutions, marketing solutions and premium subscriptions — contributing 48 per cent, 32 per cent and 20 per cent to its income, respectively, LinkedIn has to look beyond just bringing in more users. This, because its business model largely relies on allowing recruiters to mine passive talent by connecting with its sizable user base, rather than waiting for candidates to approach first.
“Technology solutions for talent acquisition are limited and firms have usually relied heavily on head-hunters. During the 2006-07 recruitment boom, the focus was on time-to-hire. But now the focus is on the quality of hiring,” said Hari V Krishnan, LinkedIn’s Country Manager for India.
Though Krishnan is unwilling to share specifics, the growth “numbers have been strong” for LinkedIn’s hiring solutions in India. “There has been adoption by the financial services sector, such as ING Vysya Bank, apart from information technology firms like HCL and Accenture. Some of the largest conglomerates, including old-world groups, are using LinkedIn to tap into passive talent,” he said.
LinkedIn’s marketing solutions are also gaining traction in India, with firms like American Express and Volkswagen (VW) using the platform to reach specific user groups. VW, for instance, brought in 2,700 product recommendations in 30 days, 2,300 new followers on the VW India company page and 960,000 viral updates about its car models through a LinkedIn campaign.
There’s also the fact that LinkedIn allows for B2B marketers to not just showcase products and services, thereby earn recommendations from users, but also to find and connect with decision-makers from other firms. “We are a very valuable platform to B2B marketers”, said Krishnan, while adding that his India sales team had a group entirely focused on this segment.
However, given the rapid growth of social networking, particularly Facebook, LinkedIn’s ability to compete with larger, wide-ranging platforms has been questioned. Rajan, though, is confident that user behavioural patterns will ensure that LinkedIn will be able to hold its own.
“Most people want distinct online interactions. We find that people do want to keep family, social and professional interactions separate. So while age demographics may be a commonality (between us and other online networks), what’s different is the context of the interaction,” he explained.
Despite the optimism, LinkedIn refuses to divulge its growth projections for India. “There are 70-80 million white collared professionals in India but only about 14 per cent on LinkedIn yet. It’s still a very small number,” Krishnan merely said.
