State of Social Q2 2016: LinkedIn Bought by Microsoft

LinkedIn, the premier business-focused social network, is no more as an independent company. In June 2016, Microsoft purchased it for $26.2 billion, one of the largest social network acquisitions ever. While LinkedIn will continue to operate as a social network, we expect this to be one of the last State of Social reports on the network, as its future data is likely to be obscured in the general Microsoft earnings reports.


LinkedIn’s membership continues to grow strongly, at 450 million registered users. Of note is that LinkedIn’s quarter-over-quarter new user acquisition rate dropped below 4% for the first time ever:

While quarter-over-quarter membership growth continues to grow, quarterly active users remained flat; the net effect is that LinkedIn’s active user base continues to trend downward towards 20%:

Above, the blue line is registered members. The green line is quarterly active users. The pink bars represent the percentage of quarterly active users versus total members; less than 24% of registered users log in quarterly.

We see mobile user growth taking another break. It’s interesting to note the seesaw pattern of mobile user growth. Every other quarter, it’s strong for no obvious reason:


LinkedIn’s financial performance picked up again as revenue-per-user bounced back above $2 per user, the ‘magic number’ of social networks:

LinkedIn Marketing Solutions, the advertising unit, also bounced back above trend again::

CEO Jeff Weiner cited Sponsored Updates as the primary driver of Marketing Solutions revenue, attributing 60% of the Marketing Solutions revenue to Sponsored Updates.

Looking Ahead: What It Means for Marketers and PR Pros

The Microsoft acquisition throws a giant spanner into our ability to predict what LinkedIn will do. Microsoft’s only social networking experience prior to the acquisition is the consumer social network it maintains in its Xbox gamer base.

Another major consequence of the merger is that quarterly reporting for LinkedIn no longer contains any information about what the company is working on or other product-focused forward-looking statements. We know from past earnings calls that Sponsored Updates continue to be the main advertising focus, but beyond that, we’ll only know what new features are available as the company rolls them out.

We are hopeful that the Microsoft acquisition also means an increased openness in LinkedIn’s APIs and developer access. LinkedIn’s developer blog hasn’t been updated in almost a year; Microsoft’s more open, developer-focused culture could benefit LinkedIn (and marketing technologists) significantly.

What should marketers and communicators do now?

Our guidance remains consistent on Sponsored Updates: continue to use them to boost visibility of your published content on LinkedIn, especially its Pulse network.

LinkedIn also slowly began rolling out video updates to its key influencers recently, permitting native video publication in news feeds. This isn’t as revolutionary as other video initiatives from other social networks; in fact, video in feed has been a capability for months. Individual users can link to YouTube videos in updates and those videos will auto-play for a significant number of LinkedIn users. If you need more views of your business-focused videos, publishing to YouTube and then LinkedIn is a good tactic.

We remain bullish on the use of employee advocacy software such as Dynamic Signal to activate your employees on LinkedIn and encourage them to share. LinkedIn is a prime candidate for employee advocacy programs because very few people publish personal updates there; employees who keep personal and professional social presences separate often have no qualms about publishing work-related content to their LinkedIn profile. Encourage your employees to use LinkedIn more; if you have employee advocacy software, make LinkedIn one of your top recommended networks.

If working professionals are your audience, whether for talent or marketing, leverage the power of LinkedIn to your advantage.

Christopher S. Penn
Vice President, Marketing Technology


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