Creativity Marketing Transformation

Solid Q3 LinkedIn Earnings but Valuation a Worry

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LinkedIn earnings for Q3 are in, and they are better than Wall Street expected. The social media platform’s stock shot up almost 4 percent in the wake of the news, making it one of only a handful of Internet stocks to succeed in recent months. But despite the gains, some industry experts worry the company’s expenditures may cap its growth and hamper its effectiveness as a platform for business content.

Content Current

LinkedIn has clawed its way up to stand among the “Big 3” social sites – Facebook and Twitter being the other two – that content marketers can use to reliably reach out to clients. But as a recent Business 2 Community article notes, content marketers have to be careful how they approach the professional sharing site. The article mentions the temptation for marketers to consolidate their social content; after all, it saves time if a post or tweet only has to be created once and then just slightly tweaked for each platform.

Taking the easy route, however, often stifles the effectiveness of social connections, especially on LinkedIn. While a tongue-in-cheek tweet or clever FB post might be just the thing to snag more page views or linkbacks, the same kind of content on LinkedIn often falls flat. By holding firm to a professional mandate, LinkedIn offers content marketers one of the best public B2B avenues available online, but only if content is tailored specifically to what’s expected by site users. Although this takes more time than an “integrate and inundate” strategy, it pays greater dividends in the long run.

Looking…Good?

It’s the long run that LinkedIn earnings projections like those over at Forbes are trying to suss out. While growth has been strong, research and development (R&D) costs and selling, general and administrative (SG&A) costs are on the rise as it looks for new markets. So far, this strategy seems to work; the site just launched Norwegian and Danish versions. The UK version now has 10 million members, or a full sixth of the country’s population. What’s more, 70 percent of new member growth came from international markets.

For content marketers, all these numbers look great. They mean that well-desgined content has the potential to reach huge numbers of professionals, even as the site trends toward more “premium” enterprise use with the addition of user endorsements of other users’ professional skills and the implementation of influencer content. In other words, LinkedIn knows its market.

But that market is getting harder to conquer, especially as it starts running up against other, international competitors. Forbes feels the current valuation of the company’s stock is too high and thought its earnings may show an ability to bring costs under control through 2013, there’s no guarantee.

Right now, content marketers need to make the most of LinkedIn and its cross-border potential. Member numbers are on a significant upswing and even if carrying around an inflated value, that doesn’t affect its ability to forge social connections for companies who take the time to properly vet their content. If the market starts to slip and the costs can’t keep up with revenues, then less time spent marketing via LinkedIn is prudent, but for the moment, marketers can’t ignore the social site’s huge reach.

Photo Source: Wikimedia Commons

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