Netflix has been a darling of the stock market with a market cap that has grown to ~$40Bn over the last 5yrs (image below). The company did this by disrupting the movie rental industry (biggest victim being Blockbuster Movies along a few thousand mom and pop movie rental stores) with its watch and return all you can/pay a flat fee business model.
Netflix stepped up its game (and better served existing customers with improved technology in the form of algorithmic filtering/selection and the move to streaming. This was great for us but was just a sustaining innovation. Not much happened to the stock price but these innovations, which weren't internally developed but were as a result of overall technological improvements, kept Netflix at the top of the game capturing more and more customers.
And then along came ‘House of Cards’ and the era of data driven original content. Using data/intent and interest algorithms, Netflix green-lighted a series that a lot of people actually doubted would succeed. Competitors missed the shift that was happening because the competition (Netflix) did not look like whom they'd competed with all along. "There's no formula...there's no textbook on the shelf that you pull down and say, 'How do you run an Internet movie distribution company?' We're writing that textbook."Even when Steve Swasey (Netflix VP of Communication) said this in 2012 talking about the show competitors missed Netflix's bigger ambition to be a full production and distribution house.
Binge watching sessions, Emmy wins by several original shows created using this mix of data/intent/interest (by Netflix and Amazon) and, most recently, the movie rights bidding wars at the last Sundance festival (with the movie writers as benefits) finally signaled to movie houses and the TV/movie establishment that they’d been disrupted by Netflix. Similar to how Blockbuster (and even Redbox) did not know what hit them...
Which brings me to LinkedIn.
LinkedIn came into the market as the network of people; people get jobs through the people they know riding on the wave of social networks and greater internet access (technology not created by LinkedIn but key to its success). People could brand themselves and very soon companies could as well.
LinkedIn knocked companies like Monster out of the game; Monster’s stock price crater coincides with Linkedin’s IPO and it currently has a market cap that is 1.8% of LinkedIn's market cap. Since then Linkedin has added more engaging content through the acquisition of Pulse (where you are reading this now) & Slideshare, mobile apps for recruitment and career training (through the acquisition of Lynda). But these are all sustaining innovations.
LinkedIn needs to disrupt another industry and I believe it should pull a Netflix and get into publishing original career development books. Especially as we all wonder about the future of work and our roles in the New Economy (if the robots don’t take over). Think about it; LinkedIn has data on the job vacancies, talent pool and their interests/skills gaps and a huge market opportunity. Data, interest, intent and predictive capability. Despite the wrong declarations on the death of books, the global book publishing industry will grow to $128.3Bn in 2019 from $120Bn in 2014. The ability to target career needs using advanced analytics and provide the books/content to bridge the skills gap will enable entrants to capture market share from (and dare I say disrupt) the incumbents.
It’s a great opportunity for Linkedin to utilize its strength and get into adjacent markets where innovation is lacking and much required.
I’ve read 4 books this year, all based on personal recommendations and I even walked into a store to buy one. Like a lot of people, I will always buy more books than I can possibly read and recommending books that meet me at my point of need will always make me open my wallet. Why else do you think Amazon is opening over 300 stores? Because Amazon knows the market is huge, technology is ripe and it's time to disrupt the book publishing industry.