The Riskiest Sure Bet of 2013
It's particularly dicey to speak of "sure bets" in the social/Internet space. Emotions, noise and media-driven hysteria often dictate what happens with these names.
Consider Facebook (FB) . Loved by the media pre-IPO. Hey, here's a chance for Joe Investor to buy a company he or she "knows" so well . And then hated after. It got so bad people were ripping Mark Zuckerberg for taking a honeymoon. Now, with the stock rising -- because things never were quite as bad as purported -- fewer haters exist.
So be careful.
That said, there's not a better-run Web company than LinkedIn (LNKD) . If they weren't such hacks I'd be surprised that most Wall Street analysts failed to ask LNKD management about the most important part of the company's strategy on its November conference call .
Toward the beginning of his opening remarks, LinkedIn CEO Jeff Weiner talked about engagement across the platform, focusing on homepage growth:
... we're seeing materially higher levels of engagement with Homepage page use up more than 60% since it's introduction and status updates recently reaching all-time highs. The increased engagement on the Homepage also benefits more than 1.3 million third-party publishers that enable members to share content through the LinkedIn platform.
TheStreet is one of the "third-party publishers" that gets its articles picked up by LinkedIn. When LinkedIn Today , the company's homepage content product, runs one of our stories, it increases page views and engagement on our end dramatically.
LinkedIn quickly became as important a partner for TheStreet as Google (GOOG) News , Yahoo! (YHOO) Finance , Twitter or Facebook (FB) . Just a few months ago, LinkedIn wasn't even on most media companies' radar. They've come on strong. And this focus on content helps drive LinkedIn's core revenue lines.
At the very end of the aforementioned conference call, an analyst finally touched on the content strategy. Weiner took it:
And as a result of the introduction of things like the new homepage, notifications, endorsements and now
influencers, one of the nice benefits that we couldn't necessarily foreseen is the compounding effect of what happens when numbers begin to interact with multiple new products and services. So we are pleased with the acceleration we have seen in the growth rates of those products and services that have been most recently rolled out.
Translation: We're giving people more reasons to visit LinkedIn. Increased visits lead to greater adoption of our premium services. In other words, LinkedIn operates a stickier ecosystem today than it did six months or a year ago.
As LinkedIn becomes more useful, it, using Marissa Mayer's words with regards to Yahoo!'s information and entertainment platform, becomes a "daily habit" for current and prospective members, thereby increasing the likelihood that these users will click an ad or buy a premium subscription.