Microsoft Acquires LinkedIn: What Does it All Mean?

Stephen HarveySocial MediaLeave a Comment

Microsoft Buys LinkedInMicrosoft, one of the world’s leading technology companies, bought LinkedIn -THE social media site for professionals and workplace recruiting. So what does that mean to us, the people of the world that frequently use services provided by both companies? Well, at first, the acquisition will have little visible impact on either tech company, but that will change as time marches forward.

Why did Microsoft buy LinkedIn?

As you may or may not be aware, Microsoft is in big time with CRM (Customer Relationship Management) software. They have the Microsoft Dynamics CRM software platform that “helps companies deliver exceptional customer experiences, creating long-term relationships based on knowledge and trust.”

Well that sounds a lot like what LinkedIn has built itself upon for years. From Microsoft’s point of view, what could be better to bolster CRM efforts than to buy a company that focused on those principles since day one? Seems like a good business decision to me. Buy the best to make your not-so-best offering a bit better.

LinkedIn has always done well the job of making a platform where professionals could showcase themselves and others could find people with specific skill sets. However, LinkedIn has struggled with profitability. At no point in time has the platform had a real, sustainable business model. Yes, some ad options and premium services for recruiters, but nothing that really had great money making potential.

Now this is where Microsoft comes nicely into the equation for LinkedIn. Microsoft’s Bill Gates perfected the software licensing model whereby making him one of the richest men in the world on a yearly basis for the past 15+ years. That sounds like a good track record to possibly make LinkedIn a profit center instead of just a cool place to hang your professional shingle.

LinkedIn is pretty much a massive database of information specifically related to people and their professional lives. And, Microsoft’s Dynamic CRM is a robust database for managing clients (aka repository of people’s professional data). So, sounds like a win-win for both parties. Microsoft can always improve its offering to compete with companies like Salesforce and Oracle AND companies like LinkedIn, that have a great service offering, can actually make money instead of treading the proverbial business waters hoping for a viable revenue stream.

Ok, how will this change things? Microsoft will have a better CRM product because of all the knowledge it will get from LinkedIn resources. And, LinkedIn will hopefully find a revenue model that works well for both LinkedIn/Microsoft and, the people will use the “new” LinkedIn platform.

Keep an eye on the digital horizon to see how Microsoft buying LinkedIn actually turns out for both groups. In all likelihood it will produce positive results for all, but time will tell.

As always, please feel free to contact LTM Digital for help with your digital needs.

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