LinkedIn takes Facebook approach and opens ad platform to developers
LinkedIn is creating an advertising platform that developers can build upon using an API similar to what Facebook has done to scale its business, according to Adweek.
Similar to Facebook’s Ads API, the LinkedIn Ads API allows developers to create ways for advertisers to start and optimize campaigns more efficiently, for example, automatically generating hundreds or thousands of ad variations or setting rules that reallocate ad spend in real time.
This could make LinkedIn more appealing to advertisers and grow the ads side of its business more quickly. By enabling third-parties to sell through its platform, LinkedIn benefits from all the sales efforts of other companies. Facebook has been able to maintain a relatively small sales team because external Ads API companies do some of the pitching and account services work for them. It also creates opportunities for other companies to build ad products to serve niches that LinkedIn might not have put its own resources toward. For example with Facebook, there are now third-party ad tools built specifically for musicians and for real estate agents. With LinkedIn’s B2B strength, there could be other industry-focused tools that arise.
LinkedIn launched its ad platform with Adobe, Bizo and Unified as partners, Adweek says. Adobe and Unified are both Facebook Preferred Marketing Developers building on the Ads API. In fact, the existing market of Facebook ads vendors could help LinkedIn’s platform grow quite quickly. A whole crop of companies have grown because of the Facebook API, and now they have teams and software that are likely to be able to accommodate LinkedIn ads relatively easily. LinkedIn’s platform could help these companies expand their business, especially as brands and agencies are looking for all-in-one solutions. Twitter, on the other hand, does not yet offer an ads API.
Facebook first began working with ad partners in 2009. It officially released the Ads API in 2011. Now there are 51 Preferred Marketing Developers certified with the ads badge, and several other companies outside the PMD program that have access to the API. Facebook earned $3.154 billion in ad revenue last year and has brought in $2.95 billion from ads between Q1 and Q3 2012.
Advertising makes up only about 30 percent of LinkedIn’s revenue. Its recruiter program makes up half and paid subscriptions bring in the other 20 percent. The company has earned $175.1 million from its marketing solutions business between Q1 and Q3 2012.