LinkedIn launches programmatic buying for display ads (MSFT, LNKD)

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LinkedIn is launching programmatic buying for display ads, Ad Age reports.

Display inventory will be available to marketers programmatically on LinkedIn’s private exchanges as well as on a majority of open exchanges. With this new product, marketers will be able to combine their first- and third-party data with LinkedIn’s targeting capabilities to place banner ads on the social network.  

Programmatic display ads will be help boost to LinkedIn’s ad business – Marketing Solutions – for the following reasons:

• Reinvigorate the company’s faltering display ad revenues. LinkedIn’s display ad business has been faltering in recent years, and its share of the company’s Marketing Solutions revenues has declined. In Q1 2016, display ads accounted for 10% of the company’s ad revenues, a 30% decline from the year prior, according to Ad Age. On the other hand, LinkedIn’s thriving sponsored content grew 80% YoY and helped grow Marketing Solutions revenue 29% YoY during the same time period. 
• Augment LinkedIn’s existing programmatic business. Programmatic buying (buying ads in an automated way using technology) on LinkedIn had already been available for sponsored content and native ads, but this is the first time that the service is being offered for display ads. The new service will also supplement the LinkedIn Account Targeting product launched in March, which lets marketers target native ad campaigns on user profiles across 30,000 companies, according to users’ job function and seniority.  
• Attract more advertisers to the platform. The combination of a large user base and invaluable user data make LinkedIn a genuine contender against some of the more prominent social networks in the market. LinkedIn’s membership is at 433 million globally, with 100 million visitors accessing the site each month, according to the company’s Q1 2016 earnings report. Meanwhile, the company has extremely high quality data about users’ jobs, qualifications, interests, and social connections. The added bonus is that this data is user-inputted and likely to be factual. The ability to advertise against this data is an attractive proposition for advertisers.

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