LinkedIn is stepping up its advertising game on top its business-related media drive.
The professional network's's advertising ambitions came into focus with last week's hire of former Google ad executive Penry Price as its ad chief. Price elevates LinkedIn's ad executive clout in line with the top ad chiefs of Twitter's Adam Bain and Facebook's Carolyn Everson.
Incoming ad chief Price was president at Dstillery, formerly known as Media6Degrees, a digital ad-targeting platform. Tweets from around the advertising industry confirm Price was a big win for LinkedIn.
"Penry's hire certainly elevates LinkedIn into the big leagues of digital advertising. Given his management experience at Google and his advanced ad products at Dstillery, LinkedIn will be at the forefront on digital marketing," says Rich LeFurgy, principal at online ad consultancy Archer and a former Interactive Advertising Bureau chief.
LinkedIn's ad business has so far played second fiddle to the company's focus on such revenue-gushing products as Recruiter, leaving its advertising technology behind industry giants.
But LinkedIn has morphed into a business news destination, making it a more attractive spot for advertisers of late.
Companies "need a place to speak directly to professionals who are interested in their products and/or services. Nobody is better positioned globally to make this happen than LinkedIn," Price wrote to USA TODAY on the day his role was announced.
The digital advertising landscape is undergoing a massive shift. With the adoption of what's know as programmatic ad buying, online ads are increasingly sold across sophisticated real-time bidding exchanges. Filled with fast-moving data on where people surf the Internet and real-time ad price fluctuations, these exchanges are used by brokers to bid for ads similar to that of Wall Street traders.
U.S. spending on real-time bidding for display ads is expected to leap from $3.3 billion this year to $8.7 billion by 2017, according to eMarketer. During this period, real-time bidding will climb to 29% of total digital ad spending from 19%. Google and Facebook have been heatedly duking it out for dominance in this arena.
Last month, LinkedIn hired David Thacker as vice president of products for its advertising unit. He will work closely with Price, who will be vice president of worldwide sales for the group. Thacker also worked at Google, as well as Groupon, in product and advertising roles.
LinkedIn is also exploring a next-generation advertising exchange similar to what's owned by Facebook, Google and Twitter, according to its own employment postings.
"It does look like they are trying to keep in sync with the industry," says LeFurgy of LinkedIn's search for an ad operations manager to research the company's strategy in programmatic ad buying.
LinkedIn's ad technology choice could take several directions. The company could buy, build or license the technology, according to Eric Picard, CEO of ad technology startup Rare Crowds and a former advertising veteran at Microsoft.
Facebook has what's known as FBX, an exchange that allows advertisers to bid for ads across Facebook. Dstillery, where Price hails from, is integrated into Facebook's FBX real-time bidding exchange. Google has its DoubleClick Ad Exchange. And Twitter this month acquired MoPub for a reported $350 million in stock to build its mobile advertising exchange business.
"What mid-2014 looks like is the majority of publishers will have solid programmatic strategies," says Chris Cunningham, co-founder of advertising technology startup Appssavvy.
LinkedIn currently relies on field sales representative to drum up online advertising. Also, it has a self-service platform for small businesses to post ads and pay for clicks. That leaves unsold inventory for online ads that run to the side or on top as banners.
Exactly what it plans for a real-time bidding network remains unknown. But use of such an ad-buying platform could lift its sales of unsold inventory for display ads. LinkedIn spokeswoman Fenot Tekle declined to comment on LinkedIn's future advertising plans.
Courtesy: USAtoday
