LinkedIn management fielded numerous questions from Wall Street analysts around how its Marketing Solutions revenue relates to engagement. A major driver of growth this quarter, said Sordello, was moving away from "customized, one-time deals" in favor of exchange-based Sponsored Content.
The platform has benefited from a more "scalable content strategy and we expect auction dynamics to improve over time," he said. Sponsored Updates account for 19% of Marketing Solutions revenue.
Sponsored Updates continue to grow as percentage of the network's business, Sordello said. "We expected some cannibalization on the display side, but it has upticked a little bit on performance and sell-through rates," he said. "As we look forward to Q3, we expect it to normalize even more."
LinkedIn rolled out a number of ads API partner programs in the spring, including Certified Sponsored Updates Partners and Certified Content Partners. Weiner said an initial five to six partners in each category have driven engagement and results, "so we will continue to invest there."
One Sponsored Updates Partner, AdStage, has been pleased with LinkedIn's monetization strategy, citing a big shift in the company culture of thinking "API-first."
"Even though LinkedIn’s ad products may not be as mature as the other networks [Facebook and Twitter], their audience is fundamentally different than a Facebook or Twitter," said Sahil Jain, CEO of AdStage. "You can call it premium or whatnot, but it’s a professional network and as long as they get their act together on the product side, they should be okay. … I think there’s a shift within the organization. It may not happen next year, but very soon we bet Marketing Solutions will be the No. 1 revenue driver of the entire LinkedIn business."
LinkedIn expects revenues of $543 million to $547 million in the third quarter with a full-year guidance of $2.14 billion to $2.15 billion.