Possessing a Product Mix is a Great Security Blanket for Early Stage ISVs

Leslie Kaufman, a staff writer for the New York Times, published an article on LinkedIn on Monday, June 17, 2013: LinkedIn Builds Its Publishing Presence. The thrust of the article cites the new “Influencers” section of the site as a new feature contributing to enhanced use of the site by visitors.

We’re also keen on the feature, but for different reasons. We think it adds a new product to the LinkedIn product mix. The main business of LinkedIn, meaning how the company makes its money, is as an advertising medium for executive search, contingent staffing and contract consulting firms. Site subscriptions are a side product, and a testimony to the health of the LinkedIn business model. We think a lot of subscriptions are purchased by individuals and businesses in the recruitment field. The LinkedIn member list is one of the best examples of a comprehensive database about people in business, and, therefore, of likely very strong interest to participants in the staffing business.

Leslie Kaufman’s article includes a conversation with Daniel Roth, the Executive Editor of LinkedIn. Kaufman writes “But Daniel Roth, the executive editor of LinkedIn, said that Influencers is catnip to executive-suite aspirants and is transforming viewer engagement on the site” (quoted from Leslie Kaufman’s article. A link to the complete article has been provided earlier in this post). “Executive-suite aspirants” are certainly of very strong interest to recruiters. So it’s easy to fold the “Influencers” feature into LinkedIn’s business model as just another attraction for the executive search clientele.

But we see it differently. The “Influencers” column adds more magnetism to the site for members, and, perhaps even members who will buy subscriptions, to gain access to original editorial content produced by well respected, successful business people.

This difference is important. Where possible, early stage ISVs should use product management to produce connected, but nonetheless separate products. If the effort is successful, then a very important risk may be rendered manageable. Too deep a commitment to a single market via one product, can be a fatal flaw, and is certainly too risky. Better mitigate the risk with a set of products tied together with common technology, but targeted to separate markets.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2013 All Rights Reserved

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