How Does LinkedIn Make Money?

Career proficient people are no stranger to LinkedIn. It is a platform for professional networking. Skilled people portray their portfolio with all their achievements to draw attention to themselves in the job market. Also, companies that come to LinkedIn seek adequate employees for their company. This is a place for the career-oriented and well-educated, well-trained group of people. LinkedIn was published in early May 2003, founded by Reid Hoffman. A team from PayPal and Socialnet had a significant role in creating a website that turned out to be a phenomenon in the job market arena. Currently, it is owned by Microsoft. Hoffman remains the CEO and continues to provide astounding service to its 630 million users. LinkedIn is the most efficient and adorned social platform in the corporate world.

Most Popular Products and Services of Linkedin

What are LinkedIn products? LinkedIn works as a career development, skills portraying and professional networking website. Its sole purpose is to help professionals to find appropriate jobs and create an extensive social connection among professionals and authorities. Other things you can do on LinkedIn is listed below.

Create personal and company profiles.
Showcase resume
Follow and connect with other professional profiles.
Search for jobs and news
Socialize in the professional arena and build-up a reputation.
Paid Premium service available (lead builders, sales alert, reference search etc.)
Attend online speeches, seminars, classes and training programs.
Connect with people in your field and create long-term and robust bonding.
Create and join groups.
Media attachment facility etc.

How Does Linkedin Make Money?

The following study elaborates the revenue model of LinkedIn or different major income streams of Linkedin employment-oriented online service.

LinkedIn has a user count of over 630 million, according to Google play store and the website data. With about 260 million active users, it is earning a fortune every year. LinkedIn has written its name in the list of top most earning social media sites. Its yearly revenue stood at $6.8 Billions at the end of the year 2019. So how are they doing it? How are they making money out of a free social media platform? Well, that is not a secret anymore. LinkedIn follows more than one revenue model. Let’s dive into it then.

Subscription Revenue Model

First of all, they pursue the “SUBSCRIPTION” revenue model. Yes, it is a free service for all. But they offer some features, which only paid subscribers can use. Subscribers have to pay a certain amount of fee to access these advanced features. Utilizing the subscription revenue model, LinkedIn makes money in two ways. They are LinkedIn Recruiter and premium access. They are discussed down below.

LinkedIn Recruiter: LinkedIn Recruiter is a LinkedIn product for corporate recruiting teams. It is a paid service. Companies use this service to primarily seek candidates. It earns 65% of LinkedIn revenue. LinkedIn charges $99.95/month for the lite version and $825/month for the corporate version. The pricing structure of the “LinkedIn recruiter” is a bit higher than usual. But the services offered usually concern large companies. That is why the percentage of “LinkedIn Recruiter” users is less but it is their major source of revenue. Large companies use LinkedIn Recruiter for accessing massive data about candidates and corporate pages and platforms. LinkedIn makes sure these users are satisfied with their service. Thus, their source of revenue stays put. It is often called the Talent Solution as well.

LinkedIn Premium: LinkedIn premium is another source LinkedIn makes money off. It brings in 17% of total LinkedIn revenue. The premium access to linked din offers an advanced and extended line of services and they charge for the service accordingly. Let’s look at some LinkedIn premium rates to understand better.

LinkedIn Premium Career costs $29.99/month, or $239.88 annual payment.
LinkedIn Premium Business is $59.99/month, or $575.88 annual payment.
LinkedIn Premium Sales is $79.99/month, or $779.88 annual payment.
LinkedIn Premium Hiring is $119.95/month, or $1,199.40 annual payment.

As you can see, LinkedIn offers a vast line of specific services under premium access. Some of its services include InMail messaging, advanced searching filters, lead and account tracking, unlimited search results, expanded 3rd level profile viewing etc. They charge the users accordingly then provide paid services. This fetches them a fair part of their yearly revenue. LinkedIn premium is used by, small to big, every type of corporation, and all sorts of job seekers as well. Premium company accounts have access to massive data about candidates. Premium job seekers can present their portfolio more attractively and make sure their resumes reach their desired company. In short, premium access allows the user to create more effective long-term and expanded professional networking. So the cost of premium accounts are well earned.

Advertising Revenue Model

Like every other social media site, LinkedIn also follows the “ADVERTISING” revenue model. That is correct. LinkedIn made $6.8Billion last year and 18% of that revenue came from advertisements. Companies, brands and candidates can put on advertisements throughout the LinkedIn platform and through the showcase of ads, the money is earned. LinkedIn has partnered with millions of businesses, products, and brands to sponsor these ads. LinkedIn charges the company ads according to their size and popularity. On the other hand, the businesses pay them for how much audience they can reach out to through visual advertising. It is defined as a marketing solution of revenue earnings as well. As said before, LinkedIn is not a typical social networking platform. So the advertisements are mostly corporate company-related and of course, others too. Advertising is not LinkedIn’s main revenue source but it is a substantial basis of their earning.

Summary of the Revenue Model of Linkedin

The bottom line is LinkedIn uses two different revenue models. One is “subscription,” and the other is “advertising.” Even though LinkedIn is a social media site, it does not follow the typical source of earning. Where most social media sites make a significant amount of their money from advertisements, LinkedIn makes most of its money (65%) from the LinkedIn Recruiter product, aka talent solution. And the rest comes from premium subscription and showcase of ads. This is how they make money. Therefore, it is certain LinkedIn is far different from other websites. It is an active professional networking platform in the corporate market.

Reference

Recruiter data: https://fitsmallbusiness.com/find-employees-linkedin-premium-recruiter/
Premium data: www.businessinsider.com/how-much-is-linkedin-premium
Revenue: https://www.businessofapps.com/data/linkedin-statistics/
Wikipedia: https://en.m.wikipedia.org/wiki/LinkedIn
LinkedIn info: https://www.businessnewsdaily.com/2489-linkedin.html
How they make money: https://vator.tv/news/2013-12-07-how-does-linkedin-make-money
Money source: https://monetizepros.com/monetization-basics/how-does-linkedin-make-money/

Tabassum Nusrat Soti

This is Tabassum Nusrat Soti and she is a content writer from Bangladesh. She has been a professional writer for over 5 years now. and she has been working with The Strategy Watch for over 3 years now.

Writing is Tabassum’s passion. Let it be SEO-efficient blog posts, analytical articles, reviews, news articles, or ghostwriting stories, she has worked and thrived in all sorts of writing. She has always had a way with words and intends to write for a prolonged unforeseeable future.

Currently, she is doing her honors (BBA) at the University of Dhaka. Majoring in the background of Tourism & Hospitality Management, she is a skilled and proactive third-year student. Her business studies background helps her write business analytic articles for The Strategy Watch. She will always keep learning and achieving new levels of content writing because of her passion for writing and creating words.