LinkedIn acquires B2B marketing firm Bizo; Apple’s iPad sales results have publishers concerned

Acquisition could strengthen social professional network’s ability to attract B2B ad dollars, and further compete against traditional trade publishers by allowing targeted, and more effective media buying

The professional audience network LinkedIn yesterday announced that it had entered into an agreement to acquire the B2B marketing company Bizo in a stock and cash deal valued at approximately $175 million. Bizo is a San Francisco-based start-up that allows businesses to advertise to other targeted businesses through a network of B2B websites. With the acquisition LinkedIn hopes to expand their marketing offerings to businesses.

Bizo-LinkedIn-slide“Bizo’s tools make it possible for marketers to reach professional audiences, nurture prospects and acquire customers across a network of business and professional publishers,” David Thacker, Vice President, Product at LinkedIn, wrote in a blog post. “They have also developed innovative products that measure the effectiveness of multi-channel marketing programs — critical to helping marketers navigate the complex B2B buying process where multiple touchpoints influence every sale.”

“We have been a LinkedIn partner for a while now, and when we started to develop that relationship a few years ago, it became readily apparent that we shared very strong and positive employee cultures, and that we both had a similar way of thinking about building out our respective businesses, with core customer-first and member-first mindsets,” Russell Glass, CEO of Bizo wrote on the company’s website.

LinkedIn is based in Mountain View, California, about 40 miles from Bizo’s Bush Street SF office.

Apple’s earnings report, and the news that iPad sales fell when compared to sales during the same quarter a year ago, has raised concerns in the media world. Apple’s iPad, like the introduction of the iPhone, established a whole new platform for media companies to exploit – and while mobile is vitally important to publishers, tablets have been seen as something more similar to print.

Apple-iPad-sales-Chart3But the past year or so has seen publishers grow increasingly frustrated with Apple App Store, and the Newsstand in particular, as the company has allowed the introduction of bogus apps which try to lure subscriptions without delivering issues, as well as new pornography apps from developers from Russia. On top of their concerns, though, has been the failure of Apple to improve app discovery through better organization of the stores, and a more effective search mechanism.

The result has been that the growth of digital subscriptions has slowed for many publishers. Wired magazine, for instance, that sold 17,629 digital subscriptions in 2011, grew that number to 81,095 in its December 2012 audit, a dramatic increase in digital readership. But the next year Wired reached only 86,178 in its December 2013 audit.

Wired is actually a success story. At over 80,000 digital subscribers, the magazine is a leader in digital sales, with over 10 percent of its subscribers now digital. Another early adopter to the tablet platform, Popular Science, also claims over 80,000 digital subscribers today.

TIME magazine, though, is more typical. It’s latest publisher’s statement shows only 1.4 percent of subscribers are digital – this despite the fact that TIME was among the first magazines to launch an app upon the introduction of the iPad in April of 2010.

Tablets are not smartphones, of course, and so sales can not be expected to mirror that of the mobile category. A tablet, especially an iPad or other high-end product, should enjoy a longer sales cycle than a cell phone – somewhere between a smartphone and a PC. That means buyers will not be looking to immediately replace their tablets every two years. Apple, which seems obsessed with cosmetics, has concentrated on making their tablets thinner each year, with better displays, but with few other improvements that might make a current owner rush to replace their older model.

But publishers are more concerned with the growth of the tablet market, not necessarily that every owner they reach through a digital edition has the newest model. In this regard, iPad sales numbers should be alarming. To date, Apple has sold over 225,000 units, and combined with Amazon’s Kindle Fire models, and other better tablets, it would seem that the market is still growing.

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