The purpose of this article is to strategically analyze and recommend the competitive strategy of the LinkedIn Company. The online business has been implementing an innovative positioning strategy whereby it has excelled in the competitive environment. The company is well known for its tremendous use of data. This situation is evidenced by its over 84 million profiles at the global level and many companies that it has captured. The company only extracts relevant and insightful data from both raw and junk information. This state of affairs has enabled it to have a large human capital bank (Juščius & Snieška, 2015).
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Competitive Advantage of LinkedIn
The main competitive advantage that is exhibited in the company is its frequent use of ‘Talk at Talent Connect 2010’ that operates on a platform and data web 3.0 (Juščius & Snieška, 2015). The larger part of its investment is channeled towards Groupon, a rich source of gathered data. This move has employed highly experienced expertise from other companies such as Google Inc. The company has a competitive advantage due to its ability to extract and match relevant ideas besides analyzing social networks and visualization (Juščius & Snieška, 2015).
Rational model In LinkedIn Company
The rational model for gathering information is done through the verification and definition of the issue, generation of possible solutions, providing assessments based on objectives, and implementation of alternatives. It also involves the monitoring and evaluation of the outcome with a view of providing feedback (Kim & Mauborgne, 2015).
In terms of competition, LinkedIn has a large resource at its disposal thus it is able to invest a lot in data synthesis thus it has gained a larger market share (Kim & Mauborgne, 2015). The existing marketplace has a minimal supplier base that has improved the company’s bargaining powers. The end customers have low bargaining power due to the existence of quality data products provided to them (Kim & Mauborgne, 2015).
There are minimal threats of new entrants due to higher costs in an advertisement. Meeting the demands of customers is also expensive; hence, entry for new businesses is difficult. Although there is a possibility of other companies using platforms that resemble the idea of faceted search to attract customers, the LinkedIn Company has the advantage of Premium Talent Filters (Kim & Mauborgne, 2015). The demand for data use and insights are seen to be increasing. However, there is little possibility that other companies will use the faceted search since the system requires skilled customers to search the essential information. Therefore, threats of substitute products are minimal (Kim & Mauborgne, 2015).
Factors determining the Success or Failure of Competitive Strategy
Marketplaces always experience constant change. As a result, companies usually study factors that affect their strategies by monitoring the existing variables and seizing opportunities that make them gain a competitive advantage (Juščius & Snieška, 2015). The LinkedIn Company has a strategy to deliver quality products as compared to those of competitors due to the changing perceptions of customers. The company conducts frequent surveys to determine new customers who can be replacing the existing ones (Juščius & Snieška, 2015). There is no overreliance on a particular supplier that can pose threat due to the bargaining power of the supplier. The company has been adjusting its strategies besides engaging various suppliers to maintain competitive advantages on both the quality and prices of products. Lastly, the LinkedIn Company always improves its Information Technology to ensure that its products are up-to-date.
Juščius, V., & Snieška, V. (2015). Influence of corporate social responsibility on competitive abilities of corporations. Engineering Economics, 58(3), 34-44.
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Kim, C., & Mauborgne, R. (2015). Blue Ocean Strategy, Expanded Edition: How to Create Uncontested Market Space and Make the Competition Irrelevant. Boston, MA: Harvard Business Review Press.