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LinkedIn Adds Services Directory

logo LinkedIn Adds Services Directory

Yes, business networking site LinkedIn is now in the yellow pages business. The site has added a “services” directory. It’s a logical extension of LinkedIn’s model.

I spoke with Konstantin Guericke, co-founder and head of marketing for the site last week. He told me that members had been effectively asking for something like this for some time. It’s also a way to create more usage frequency for LinkedIn, which has millions of members who only use the site very occasionally.

Here’s the list of current categories represented:

  • Art, Creative and Media
  • Consulting
  • Employment Services
  • Financial & Legal Services
  • Health & Medical
  • Home & Garden
  • Other Professional Services

According to Guericke this list will grow and get more detailed over time. Significantly, he also told me that LinkedIn isn’t going to sell placement or “featured listings.” He wants to keep the service recommendations area free from ads, which can now be purchased on other areas of the site.

So why might this work in a very crowded market of online directories? Trust. In one sense this is an over-used cliché of social networking; but it’s also true. In many directories one uses the review consensus to determine whether to proceed with a recommendation. On LinkedIn I’ll see recommendations from my network (presumably people I directly know and have worked with), then those once removed from me and then the entire LinkedIn community.

The fact that there will be no way to directly advertise will also make this a more credible source of recommendations for users. However, LinkedIn is ranking providers in certain categories by the quantity of positive reviews — and this should drive business to those in the top positions. However, members do solicit recommendations from people — a number of people have asked me for recommendations in the past. Presumably, however, people don’t write them if they’re not generally sincere and accurate. So that’s a control of sorts on the quality of the recommendations.

The categories that develop here will also be interesting. People aren’t going to write restaurant reviews, I would imagine, or go to LinkedIn looking for them. People are more likely to seek out lawyers, accountants, web designers and architects.

The site needs to build a critical mass of local area content to become truly valuable. (Although not all recommendations need to be local.) But LinkedIn has the luxury of time, since the services directory is not a revenue driver and merely augments its primary usage. So there isn’t the revenue pressure on LinkedIn that exists at other “social directory” sites.

LinkedIn has emerged as the only meaningful business networking site online, although there are a number of business networks forming around specific verticals such as real estate. And if you’re a member, you can anecdotally feel that there’s more and more usage from the volume of emails. According to figures cited by Reuters, the site now has almost 8 million registered users around the world and makes most of its revenue from premium account services.

The persistent issue has been how often those members visit and use the site. The new services directory should create more reasons to go there.

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Greg Sterling is the founding principal of Sterling Market Intelligence, a consulting and research firm focused on online consumer and advertiser behavior and the relationship between the Internet and traditional media, with an emphasis on the local marketplace.

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