Monday, June 13, 2016

6 Reasons Microsoft's LinkedIn Acquisition is Different



For anyone left who thinks that Microsoft is the same company it was in the heyday of Windows, today's acquisition of LinkedIn shows just how far Microsoft is willing to go in pursuit of its long term vision.

How is this acquisition different from earlier acquisitions?

  1. Microsoft is acquiring the leader.  Similar to the Skype acquisition, Microsoft is gaining market share from a top player and not an also-ran. 
  2. Microsoft's timing for cloud and social is right. Microsoft comes into this acquisition with strong momentum of Office 365 and Dynamics CRM Online cloud growth.
  3. LinkedIn targets business rather than consumer users. The business market is more conservative and less likely to flit from one social network to another.  
  4. Paid and free services go well together. Microsoft offers a strong sales channel and field sales presence that create new opportunities to monetize LinkedIn.  Free users create a steady stream of prospects for the combined product and service offering. 
  5. The target customers of Microsoft and LinkedIn overlap. Office 365 is a potential jumping off point for LinkedIn (and vice versa) and a large number of current customers use both services. 
  6. Microsoft CEO Satya Nadella is on a roll. In his memo explaining the acquisition, Mr. Nadella points to new customer experiences that will be made possible in Office 365, Dynamics CRM and LinkedIn.  He has energized Microsoft's leadership and shown the boldness needed to make further progress. 

The possibilities of using LinkedIn data to improve sales and marketing are tantalizing.  What if you could integrate Office 365 messaging with LinkedIn paid subscriptions for messaging?  Could you post directly from Office 365 to LinkedIn groups?  How about building a marketing list in Dynamics CRM of your LinkedIn connections and invite them to an online event?

The LinkedIn acquisition answers the question of how Microsoft will use its cash to increase its competitiveness for the long haul.  It may produce results in the short run and change the behavior of Microsoft's competitors.




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