LinkedIn Mobile Ad Focus Countered By Reduced Share Price

Last month, LinkedIn revealed plans to begin testing mobile ads for its iPhone and Android applications. Though the social network announced strong first-quarter revenues, up 72 percent from a year earlier, the social network has seen its share price fall more than 10 percent after disappointing revenue forecasts for second quarter.

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Last month, LinkedIn revealed plans to begin testing mobile ads for its iPhone and Android applications. Though the social network announced strong first-quarter revenues, up 72 percent from a year earlier, the social network has seen its share price fall more than 10 percent after disappointing revenue forecasts for second quarter.

The reason behind the drop in share price revolves around the company’s decision to focus less on display advertising and more on mobile advertising. With a revamped mobile app, LinkedIn looked to keep more users signed in to their accounts longer with the potential to sell more advertising. It is possible that users have not been receptive to these advertisements, which are simply not earning clicks.

LinkedIn’s lowered share price suggests that a revamped mobile app may not deliver on ad growth as quickly as anticipated. LinkedIn has reported that the percentage of users accessing the network through mobile apps is up to 25 percent, a 10 percent increase from last year with a third of the site’s traffic coming from mobile devices. In attempts to follow this migration, the refocus on mobile ads has come at the expense of display ad revenue. Yet with disappointing share prices, the social network is still in transition and only time will tell if there is a lasting impact.

To learn more about this topic, join us at Inside Social Apps in San Francisco June 6-7. One of our sessions is “Trends in Social and Mobile Advertising.” The panel will highlight which types of ads fare best on which platforms.