LinkedIn and Facebook: 2 Different Approaches to Monetizing Content

Content is king. This seems to be the propaganda driving recent efforts by LinkedIn (NYSE: LNKD  ) and Facebook (NASDAQ: FB  ) to take their content efforts to the next level. Both companies, however, are taking very different approaches to delivering content, and using it to drive business results.

LinkedIn, the publisher

Image source: LinkedIn.

"[W]e are making a commitment to our members: the time you spend on LinkedIn will make you better at your job today," said LinkedIn in a press release this morning. LinkedIn not only is aiming to be your go-to network for professional networking, but also a place for honing your professional skills, with access to top-notch job-related content.

Before today, LinkedIn's publishing platform, referred to as LinkedIn Influencer, was only open to the elite. Voices included Richard Branson, Martha Stewart, and Bill Gates, and The Motley Fool's own Tom Gardner, among others. Influencers were hand-selected, and drove meaningful engagement on the platform with average views per post of more than 31,000. But now, LinkedIn is opening up a publishing platform to the rest of its members -- kind of.

The rollout begins with 25 thousand members -- just a fraction of LinkedIn's total 277 million members. In "the next few weeks and months to come," LinkedIn will be expanding the capability to "all members in multiple languages." Distribution for members' posts will be initially limited to the author's network of contacts, according to The Wall Street Journal. "If they get traction, they'll be distributed to a wider audience of LinkedIn users," says the Journal's Reed Albergotti. LinkedIn's corporate communications manager, Doug Madey, told The Motley Fool that the Influencer platform will remain separate from the general publishing platform.

Image source: LinkedIn's official blog.

This publishing rollout highlights the major difference between LinkedIn's approach to delivering content to its members from Facebook's approach. LinkedIn wants to be a leading source of original professional content -- it wants to hone its skills as a publisher. Facebook, on the other hand, wants to focus on personalized content -- it wants to be a curator.

Facebook, the curator
Facebook, too, has been pushing its social network as a platform for content. Facebook's approach, however, is very different.

First and foremost, Facebook's content push differs in purpose. LinkedIn wants its content to benefit members as professionals; Facebook wants to be its members' newspaper for a broad range of topics.

Second, Facebook is curating news published elsewhere, bringing it to members in a useful way. It's not making any efforts to become a publisher of its own content, like LinkedIn

Facebook CEO Mark Zuckerberg explained the company's broader mission for curated news in a March 7 press conference when it unveiled the new look of its timeline.

What we're trying to do is give everyone in the world the best personalized newspaper we can. We believe that the best personalized newspaper should have a broad diversity of content. It should have high-quality public content from world-renowned sources, and it should also have socially and locally relevant updates from family, friends, and the people around you. It should also enable you to drill into any topic that you want to discuss.

Facebook's recent launch of Paper is an excellent example of what this could look like. The iOS iPhone app is a news curator with the Facebook news feed built into it, along with Facebook's other main features: messaging, liking, and sharing updates, among others.

Facebook's new Paper app. Source: Facebook's Newsroom.

LinkedIn also curates content from external sources, like Facebook. But a move to open up its publishing platform to more members, combined with its focus on professional news, draws a distinct line between the two companies' strategies 

Conclusion
The big takeaway for investors is that both companies have a focused approach to using content to drive their businesses. This is great news for investors. A focused mission is especially important for these fast-growing tech companies as they attempt to assert their image early on as the Internet becomes ever crowded with social platforms.

More specifically, content keeps users engaged, and helps the platform learn about users' interests. Both of these outcomes benefit the network by strengthening their member network effects, and by benefiting parties beyond members with more useful data about the networks' members -- particularly recruiters for LinkedIn, and advertisers for both LinkedIn and Facebook.

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  • Report this Comment On February 19, 2014, at 9:58 PM, SocialMedianDown wrote:

    The difference between LNKD and FB is

    LNKD P/E is 900 and FB P/E is 100;

    LNKD has millions users and FB has Billions users.

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