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GROWTH HACKING FUNNEL

LINKEDIN'S GROWTH HACKING STORY



LinkedIn is a social networking site for business professionals that was founded in 2002 and launched in 2003. In 2008, there were about 13 million users before growth hacking strategies employed by Elliot Schmukler caused the California-based platform to explode. Currently, LinkedIn has 259 million members in 200 countries speaking 20 languages.

The value propositions of the LinkedIn idea were clear from the beginning. The service sought to make business networking easier by enhancing communication among colleagues, and facilitating valuable introductions thus broadening connections.

Recruiters, job hunters, and reporters immediately saw the potential in LinkedIn’s information repository, but about 50% of the users were passive. They created profiles initially, but then did little with them, which significantly slowed growth.

In an attempt to remedy this situation, Schmukler first worked to understand all the ways in which new users organically discovered LinkedIn. Primarily, this occurred through email invitations and search engine queries that directed people to member’s profiles and home pages. Both channels worked, but were in need of reinforcement.

Analysis revealed that when emails were sent to users notifying them of a profile view, active users clicked through at a rate of 20%, but inactive members responded with only 5% click though.

Schmukler could have worked on redesigning the emails to maximize effectiveness, or conducted “drip” email campaigns to lure inactives back in, but instead he decided to develop links between actives and inactives through an “endorsement” feature.

The campaign worked, until September 2013 when customers balked, filing a lawsuit against LinkedIn. The plaintiffs claimed the service appropriated their identities for its marketing purposes, tunneling into their email accounts and mining their contacts to broaden the reach of the service’s invitations.

At the heart of the complaint is LinkedIn’s encouragement for new members to invite others to the network during the sign-up process. Without question, the aggressive emails, whether through invitations or endorsements for existing members, have been a significant growth strategy for LinkedIn.

Other companies, including Facebook, have also received scathing criticism from users for similar strategies that, though effective, can be perceived as compromising the privacy of members’ contact lists. Fortunately, by the time the lawsuit was filed, LinkedIn had already established a sufficient user base for growth to take off on its own.

This points to the truism that growth hacking strategies don’t have to last forever. A questionable strategy like the one used by LinkedIn can be effective in the short term so that when the company is “caught” and compelled to shift gears, the existing benefits outweigh any negatives of the forced course correction.


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