Microsoft’s LinkedIn Acquisition: Taking over the professional world

One of the biggest information technology companies in the world announced its merger with the world’s largest professional network on June 13th 2016. LinkedIn was bought by Microsoft in an all-cash transaction at $26.2 billion for $196 per share. Microsoft CEO Satya Nadella’s objective for the acquisition echoed in his statement “Together we can accelerate the growth of LinkedIn, as well as Microsoft Office 365 and Dynamics as we seek to empower every person and organization on the planet.” (Microsoft News Center, 2016). In over 4 decades of Microsoft’s existence, the largest software-maker has been able to connect with over 1 billion users. On the other hand, LinkedIn has shown tremendous growth as the world’s largest professional network with increased membership to more than 433 million members worldwide. Adding this with the intelligent LinkedIn newsfeed, the year-on-year engagement growth are vital markers that prove their standing today.

In its attempt to penetrate the professional networking platform, Microsoft has chosen LinkedIn to join them on their journey to ‘empower people and organizations’ throughout the world. “Just as we have changed the way the world connects to opportunity, this relationship with Microsoft, and the combination of their cloud and LinkedIn‘s network, now gives us a chance to also change the way the world works.” “For the last 13 years, we’ve been uniquely positioned to connect professionals to make them more productive and successful, and I’m looking forward to leading our team through the next chapter of our story.” Read Weiner’s letter on the LinkedIn – Microsoft deal. (Weiner, 2016). LinkedIn’s vision to ‘create economic opportunity for every member of the global workforce through the ongoing development of the world’s first economic graph’ is ambitious, yet not impossible with over 400 million members in just 13 years. (LinkedIn, 2014) (Figure 1, Microsoft News Center, 2016).

Why LinkedIn?

LinkedIn’s acquisition by Microsoft can be seen as one which involves combining synergies that would ultimately would help develop new businesses. In this approach, Microsoft would use LinkedIn’s technology and integrate it in its software to provide their users the ‘ultimate professional experience’. Although this is speculated to be a reason for the acquisition, analysts find it hard to imagine the deal to be purely a ‘blend of businesses’ since Microsoft paid $9 billion premium (which is over LinkedIn’s market value).

Another reason why this acquisition may not seem to be a simple ‘mixing of synergies’ is due to Microsoft’s previous fail with a similar approach with Nokia. While the 2014 Nokia acquisition was initially made to add value to Microsoft’s services, the deal is perceived as a failure since after a year of making the deal, Microsoft wrote off Nokia for $7.6 billion (which is more than what it paid the phone business for – $7.2 billion). In 2015 Microsoft announced 7,800 job cuts and Satya Nadella stated that Microsoft was restructuring, further adding to his statement “Microsoft devices will spark innovation, create new categories and generate opportunity for the Windows ecosystem more broadly. Our reinvention will be centered on creating mobility of experiences across the entire device family including phones.” (Warren, 2015).

Another acquisition model that would make better sense is an integration of strategic mix with the private equity model. This deal would have the same benefits as combined synergies in addition to pumping business with resources and possibly, sell it high in the future. A better comparison to this type of acquisition is the ‘Google model’ also known as the ‘Alphabet model’. In this type of acquisition, the company evaluates businesses with potential, acquires them with the purpose to nurture them and at the same time let them run independently. If this merger is Microsoft’s way to follow Google, then LinkedIn is the first step towards Microsoft’s own ‘alphabet’. (Gomes-Casseres, 2016). The parent company would have numerous businesses, independently running yet a part of the same mission.

When the Microsoft’s acquisition of LinkedIn was announced, senior analysts and industry experts saw this move as a failure. One of them was Roger L. Martin, who in his Harvard Business Review article explicitly states that “Companies that focus on what they are going to get from an acquisition are less likely to succeed than those that focus on what they have to give it.” According to him a staggering ‘70%-90% of acquisitions turn out to be abysmal failures.’ (Martin, 2016). The question that everyone seems to asking is

‘What would Microsoft benefit from acquiring LinkedIn? ‘How would LinkedIn benefit from Microsoft after the acquisition?’

There could be two possible significant reasons for an acquisition of this magnitude. First, to provide the acquired business increased growth capital, second, to overlook the management and provide valuable skills wherever required. This transfer of rich resources and sharing capabilities between businesses is a risk for both to make a collaborative effort to deliver better services and products. But since Microsoft said that “LinkedIn will retain its distinct brand, culture, and independence”, it is better understood that overlooking LinkedIn’s management is not on Microsoft’s list. (Frick, 2016)

Figure 2 (Warren, 2016)
Figure 2 (Warren, 2016)

Microsoft has an established market presence and is also one of the top companies with the highest spend in the research and development (R&D) department. Another part of Microsoft, fully dedicated to conduct research in top universities across the globe is called Microsoft Research. Focusing on their users overall professional development, one of the many companies LinkedIn acquired called lynda.com is an online learning platform to help teach people business and technology skills. Both Microsoft and LinkedIn merged as one could encourage participation by professionals and help leverage user engagement. (Figure 2, Warren, 2016) The target segment for both LinkedIn and Microsoft include a majority of career-oriented digital enthusiasts. This list includes students, young professionals, executives and company employees. Microsoft has a reputation to create innovative technologies, having introduced products like Xbox 360 and Skype translator in the recent years. (Casey & Hackett, 2014).

If Microsoft has stood the test of time, LinkedIn stands as the dominant professional networking platform today, having acquired several hundreds of million users within a span of a couple of years. There is a visible growth in IoT (Internet of Things) market giving way to the growing mobile application servers. This fits with LinkedIn’s focus on its mobile presence with its recent year-on-year increase at a rate of 49%. (Microsoft News Center, 2016) Other major opportunities include introducing Microsoft users to their cloud computing services integrated with the LinkedIn platform. Microsoft can help organize the large LinkedIn database in a revolutionary way by converting them into ‘data products’ and selling them to members, recruiters and universities. (Davenport, 2016) Having said that, Microsoft and LinkedIn have had their share of legal issues where the latter even faced data privacy violations. Both these giants face extreme competition and with their ongoing legal proceedings, they may invite government regulatory laws.

Another point to ponder over is how these very two distinct company cultures are going to co-exist post-merger. While one has aged decades and stands as a bureaucratic giant, the other is young, energetic and constantly innovating. Not to insinuate that post-merger ‘culture-fit’ would be the number 1 problem between the companies but acquisitions where office cultures prove compatible have noticeably been more successful. (Knilans, 2009). Although most of LinkedIn’s revenue is generated from advertisements and selling subscriptions to corporate recruiters, pushing organic content creation on its platform is one of reasons why 100 million people visit LinkedIn pages each month.

LinkedIn is emerging as a hub for content.

People turn to LinkedIn for opinionated articles from influencers, company executives and experts, applauded journalists and multinational companies. In addition to using LinkedIn to get bigger reach in terms of social networking services and professional content, Microsoft will use LinkedIn’s social graph as an integrated selling tool alongside its existing CRM products. (Lunden, 2016). While the competition in the market is fierce, having merged into one force, the companies have notably become more powerful from what they were. (LinkedIn Corporation SWOT Analysis, 2016, pp. 4; Microsoft Corporation SWOT Analysis, 2016, pp. 4)

Figure 3 (Gershbein, 2016)
Figure 3 (Gershbein, 2016)

In their interview (Nadella & Weiner, 2016), both Satya and Jeff talk about how the merger would help them create an individual’s ‘entire professional experience’, transforming careers worldwide. The possibilities are endless with Microsoft delivering its users with the latest software technology with a choice to be a part of the world’s largest professional network. Having acquired intelligent businesses in the past couple years, Microsoft seems to be planning a huge comeback with its most recent purchase. Although Microsoft has bought Nokia’s Devices and Services division (only the smartphone department in Nokia), there is a possibility they join hands with Nokia’s Technology department in the future which is currently working on introducing the world to a ‘new era of communication’ through 5G. (Nokia Networks, 2016). LinkedIn, the world’s most influential, specialised, highly read, constantly-updated digital media companies (Feller, 2016; Figure 3, Gershbein, 2016) can play a strategic role in this comeback and help reposition Microsoft.

As on early 2016, there are about 87 million millennials on LinkedIn (LinkedIn Marketing Solutions, 2016) who spend 18 hours a day consuming media (Taylor, 2014). These numbers signify a surge in the need access this content from anywhere (read: mobility) and satisfy the need for immediacy of information. As social networking takes over our personal and professional lives, connecting online will be as vital as face-to-face meetings. Microsoft will attempt to transform our online experience into something more valuable through measurable reach and influence. If LinkedIn manages to retain its independence and continue to engage its audiences whilst under Microsoft’s years of wisdom, LinkedIn could change Microsoft’s history with acquisitions.

At this point, LinkedIn’s abilities to connect the world with every professional and Microsoft’s mission to empower each and every person through their services can be critically analysed as an attempt to outdo increasing competition in the industry. The risk of reputation lies with both, as both brands have earned significant value over the years. With the introduction of smartphones using Microsoft and Nokia’s technology in the near future, Microsoft’s relationship with LinkedIn will be tested.

 

This case study was first put together as a part of my coursework for master of marketing communications at the University of Melbourne.

Nike India Commercial: Embracing Women Body Image Issues

One of the globe’s largest corporations, Nike is known for their athletic shoes and apparel. In fact, “in 2014 the brand alone was valued at $19 billion, making it the most valuable brand among sports businesses. Today, Nike is one of the largest public companies in the world.” (Forbes, 2016). This year, the multinational corporation has jumped to 91 from 106 on the Fortune 500 list. (Fortune 500, 2016).

But the company was not always growing at this pace.

Despite being one of the top athletic companies of their time, Nike was not the first to introduce sporty products exclusively for women. “In 1981, Reebok, one of Nike’s competitors in the athletic shoe industry, chose to make women its primary target market” (Lucas, 2000). Reebok went on to earn profit that year while Nike experience a significant dip in sales. It was not until the 1990’s that Nike started marketing products for women. Nike used icons, symbols and indexical signs to create and develop a concept of community for an audience that was once uncatered, that is, the athletic female. Nike introduced women to the idea of being strong, athletic, in an approach that did not threaten their femininity. It was an accustomed option, a new identity that women could embrace without feeling as if they were stepping into an unknown territory. This way, Nike positioned itself as a brand that united women to the idea of stepping into a category, previously only dominated by men. (Grow, M. Jean. 2006).

Distinct from their first commercial aired in 1982 (Nike’s first television commercial – 1982, 1982), today Nike strategically creates advertisements specifically for female audiences, involving their intricate life experiences and hurdles and blending them in a way that appeals to all those women who strive to either enter sports or those who have already achieved credibility as a sportsperson. With numerous online and offline marketing campaigns to add to their brand value, their tagline ‘Just Do It’ has been named as one of the top five slogans of the 20th century. (Advertising Age, 1999). Nike allocates a huge part of their marketing for just women sports products. “Nike is bullish about what’s ahead, projecting $50 billion in sales by 2020 due to a global shift toward fitness and significant growth from the women’s business, Jordan brand, and e-commerce sales.” (Fortune 500, 2016). “The women’s business has proved lucrative for Nike, growing 20% in the fiscal year ended May 31. That’s twice the rate of its men’s business…”   (Malcolm, 2015).

With a history in representing women who play sports, Nike has decades of background in advertising and marketing to this specific target segment. Making sure it stays current with the on-going cultural conversations, Nike has come up with an advertisement this year that vouches for their stand on embracing women of all shapes and sizes.

This Nike advertisement was first published on December 10th, 2014 on Bani J’s YouTube channel.

Although Bani J herself is paradigmatic to the idea of women bodybuilders, the complete video is a syntagmatic representation of how this independent woman lives her daily life and fearlessly follows her passion. The surface level reading of the advertisement is that of an independent woman choosing a healthy lifestyle, but a deeper reading reveals the acceptance of all kinds of body types and a sense of approval which is required by all humans and is regarded as a primitive need.

After a run, she posts her achievements on social media and makes yoga dates with her friends. She is one of the 83% of the millennials for whom “wellness is a daily, active pursuit.” (Goldman Sachs, n.d.). When compared to their predecessors, millennials are smarter eaters, regard smoking as more of a taboo and exercise more. This is the generation that uses applications on their phones, tablets or laptops to search for information to make informed diet-related decisions as well as to track their training data or diet history. This is also an area that they are willing to spend money in to get the best quality services. Understanding what millennials want, large corporation like Nike have “build their (marketing) strategy around digital-physical fusion.” (Rigby, 2014). In addition to this healthy side of her life as seen in the video, Bani J does not forget to have fun with her girlfriends every once in a while.

The video continues to show glimpses of her life while the background music is consistently peppy and upbeat with lyrics mostly repeating “don’t stop”. This makes the underlying theme of the video motivational as it showcases the life of Bani J. Words like “train”, “run”, “live” and “style” flash the screen representing the ‘signifier’, that is, the words that symbolize positivity, health, exercise and staying in fashion. Bani J’s lifestyle choices, body type, eating habits, work out regime, her choice of clothes and tattoos, all act as the signified while Nike’s campaign acts as the signifier that puts her muscular body type in high regard. Here, Nike positions itself as a brand of the current generation that embraces all women body types.

Despite what the message of the video is trying to send across to the masses, Bani J has faced significant backlash for her ‘muscular body’ from the viewers. People on social media have been quite vocal about their disapproval for a woman to have a ‘muscular body’, saying things like –

‘Lifting weights will make you look manly’, ‘You’re not a girly girl if you lift weights’, ‘I don’t lift weights because I just want to ‘tone up’, ‘Girls should only do cardio, lifting is for guys’, ‘So what steroids are you on’, ‘That’s way too much muscle.. For a woman’.

-(FirstPost, 2016; Hatch, 2016; The Hindustan Times, 2016; Baruah, 2016).

The irony of this Nike advertisement is that although it conveys freedom of choice to a woman to live her life the way she wants, even if she wants to be a bodybuilder (as in this case), the protagonist of the video received backlash for the very same reason.

Another Nike advertisement (as seen in figure 2) called ‘Da da ding’ presents itself as a perfect example of a video that is created to help develop a sense of acceptance for all body types in women. (Natividad, 2016).

The advertisement is able to speak to women who may be short, tall, muscular, slim, bulky or curvy and convince them that they are capable of achieving anything regardless of their body type. With the idea of showcasing a woman choosing to keep healthy by going to the gym, maintaining a fit body and proud of her muscles, the Nike advertisement was able to build on its brand with the reputation that it understands the issues of women just as it does the other sex. The advertisement speaks to women of all shapes and sizes, women who are self-conscious, women who would rather not choose a certain career in life because their body type did not conform to society’s idea of ‘normal’. With a majority of women facing body image issues, the audience the commercial caters to is a staggering number. I conclude this article with an epiphany that if huge corporations like Nike focus on developing marketing campaigns directing at creating positive body image and diminishing body image issues in women, the self-acceptance and happiness quotient in women will rise, giving way to a happier consumer population.

 

This was first put together as a semiotics textual analysis paper as a part of my coursework for master of marketing communications at the University of Melbourne.

Crash Course in Public Relations for Startups

It’s no secret that thousands of startups from all industries have been mushrooming across the country, especially in the last two years. This month a research firm revealed that a staggering 40 percent of these startups have already shut operations.  While lack of sufficient funding, core skills and shoddy marketing are few of the top reasons why startups fail, minimal light has been shed on the importance of Public Relations.

PR is vital for the simple reason that it connects organizations with their audiences.

PR is all about making the right connections

Relationships are important. Relationships are important. PR teams are designated to identify the target audience and build a relationship with them – backed up by a strong marketing strategy. While large companies hire an elaborate team to build these relations, more often than not, startups tend to underestimate the significance of customer feedback. It may look like a small task but there is serious effort behind highlighting organic positive feedback. Customers – satisfied with the service/product or not – need to feel valued. When a startup successfully delivers to a customer, it’s something to cherish. And when it doesn’t, it compels the team to troubleshoot and fix issues. Giving customer relationships its due prominence, startups like Flipkart and Myntra provide customer care through prompt tweets.

Get involved with the media

I recently stumbled upon an article that elaborated on how some successful people like Elon Musk and Oprah take out a certain amount of time to read. While how much one reads in a day varies, on an average these visionaries find 2-4 hours per day to update themselves on industry insights. I adopted a similar approach at my startup job and spent about an hour on Twitter every day to explore upcoming events, campaigns, running offers, and read up on elaborate startup stories.

More time reading also gives us a chance to discover journalists who cover specific industries, in fact, over time, it makes sense to nurture such professional relationships by offering exclusivity of product updates and company announcements. This symbiotic relationship is worth the investment.

You know what they say – Content is King

These days, marketing teams of established businesses are constantly working to create content that is clickworthy, evokes an emotional response and is deserving of a share or like, which is exactly the kind of material startup PR teams should work on. Viral content is bound to drive more traffic to the website, customer loyalty and ultimately, increase sales. Take startups like Popxo that are making a mark by creating trendy, youthful and relatable articles focusing on young girls as their target audience.

Personal Branding builds Brand Reputation

In another article, I talked about how more and more influencers from all over the globe are focusing on developing themselves as a brand. Personal Branding is key in helping a person stand out in a sea of people and emerge as an expert in a domain. Founders, investors and even employees can use their brand currency to voice their opinion on industry insights, connect with the audience on a more human level and ultimately, build a following for their company – leading to positive development of their company brand.

Always analyse what’s working & what’s not

Some marketing & PR strategies work for certain startups while others don’t – this depends on factors such as demographics and demand for service/product in that area. Startups usually lack patience and have a reputation to skip hiring a public relations team.  After a couple of hit and trials, a startup should finalize on a PR plan to help create their product into a well-known, easily approachable brand.

This article was originally posted on YourStory.

 

The X Factor – Personal Branding

LinkedIn, Twitter, Facebook and even SnapChat are social media giants being used by individuals to connect with others, network and create their own image, ultimately, develop their own brand. Going back to how I got familiar with Personal Branding, when I was working in a startup’s Public Relations department, it was up to to me how we got out there – what we said, how we said it and what the company image looked like.  This was my first dive into Corporate Branding.

Within a short period of time, it was quite evident that creating a brand out of a healthcare organization was going to be relatively tougher than it is with others since the making of a health related brand requires the utmost level of human trust. This comes from ticking a bunch of checkboxes one of which being personal connection with the customer.

Paarul Chand, Editor, PRmoment India mentions the emerging significance of Personal Branding, “Among communication consultants, I am seeing a rising trend of professionals maintaining their own brands online. No longer are they content to be just behind the scenes coordinators. I often find such platforms useful sources of information about the world of PR. In a world where emotional connect matters as much as the sales connect, it is inevitable that the personality of the person doing the selling will come into play.”

Do you have what it takes?

Saurabh Uboweja, Founder, CEO and Chief Brand Strategist, Brands of Desire recently launched a first-of-its-kind online learning platform called Branding Institute to educate entrepreneurs, leaders and managers who want to build dominant organizations using the power of branding. He said, “There are many areas where a person might excel but the struggle remains to take the call and choose one. This is because being a jack-of-all-trades is the biggest downside for someone building a personal brand. When a person does set his mind to develop his brand around a specific domain, it should be something that comes natural to him – there’s absolutely no beating around the bush.”

Why Personal Branding?

People trust brands because they are brands.

But foremost, people trust people.

According to a survey conducted by a New York City based social media agency called Brandfog, CEOs who are active on social media are perceived as better leaders who can build better connections which employees, customers and investors.

Personal branding is synonymous with reputation and that’s what makes it so powerful.

The idea is to customize the product or service according to the company brand.  Taking a brand like Facebook, where Sheryl Sandberg oversees human resources, public policy, and communications among other departments, her personal branding revolves around women empowerment – further making use of her position to raise the issue of equal pay at workplace. This is a clear case where personal branding can be seen influencing the existing face of company to a more gender-friendly brand.

Paarul further adds, “With the entry of the start-up culture in India has come the concept of personal branding that helps sell a product, a service, an organisation. It’s hard to separate the personalities of co-founders of organisations such as FlipKart, SnapDeal from the organisations themselves. Internationally, too, you can see this in the impact storied entrepreneurs such as Elon Musk have on their brands like Telsa. It’s not surprising then that this is percolating into the non-start up world as well.  When it goes well you have brands such as No Nasties (where the personal commitment of the founders towards helping cotton farmers is tied strongly with the brand’s value proposition), Ratan Tata (whose personal integrity has a strong impact on the trust with which Tata companies are perceived) and Raghuram Rajan (whose personal credibility lent so much to RBIs policies). When it goes wrong you have a Rahul Yadav (Housing.com), a Donald Trump (who is doing incalculable damage to the idea of American democracy).”

Personal branding is subtle yet the results are extraordinary.

A brand is created over timeThere’s a lot of ground work that goes on to bring the focus on the brand:

  • Developing and working around a real-time calendar on industry news and trends;
  • Creating content around researched keywords relevant to anything from personal experiences, country and global concerns;
  • Persistent efforts and long-term commitment to these tasks with the help of social media platforms increase readership among the target audience, which facilitates customer loyalty and indirectly impact company website SEO and ultimately revenue.

 

When compared to corporate branding, personal branding is rather unpredictable.

Does it matter how many times a founder publishes an article on LinkedIn in a week? The answer is no. Prior planning is not instrumental, in fact impromptu ideas are more than welcome. In conclusion, personal branding is unpredictable especially since it’s based on how a person interacts with another.

No medium is the right medium.

Some medium might work well for one, while another medium may work well for someone else. A brand that comes to mind – Shradha Sharma. After the launch of YourStory, she came out as the real storyteller. Through self-written articles she shares on LinkedIn, she is honest, inspiring and down-to-earth.  She is active on all social media giants, especially Twitter where she has over 52K loyal followers. She is the perfect example of how Personal Branding aids Company Branding. Not that YourStory needs it (116K followers) but the fact that the founder is so vocal and focused on what she aims to achieve with her company is what makes it so appealing.

More and more influencers from all over the globe are focusing on developing themselves as a brand. While corporate branding is indispensable, Personal Branding is key in helping a person stand out in a sea of people and emerge as an expert in his domain. But does the increasing importance of personal branding mean that one day it might overtake the significance of corporate branding? Only time will tell.

 

Originally posted on Inc42 media.