Linkedin taking the traditional approach in Germany and why that will fail (as usual)

Posted on February 4, 2009 under blog ,

 

Logos Xing / LinkedinUpdate 2009-02-07: Video production manager Rob Getzschman mailed me yesterday about their updated version of the video, correctly titled “Cheesy LinkedIn German video updated” ;) I have included the new version below. The only change is a a new voice over for the small German part, but that already is an improvement. I leave my original notes below for reference, but have replaced the video with the newer version. Also I have added at the bottom a longer link list of German and English links for this topic. You should be able to use Google Translator or alike for easier reading.

Update: LinkedIn adds a more or less cheesy video named ‘next bus stop german’.

Cheesy because most people in the video do speak with accents, especially the voiceover. While this is not that bad and may sound like a good idea, mostly you hear these kind of voices on badly translated informercials. It reminds me of these because if you watch it (even as non German speaker), you will note that it shows nearly nothing – instead of featuring some of the great advantages Linkedin may have to the user, it just repeats over and over again the notion of “are you in yet??” and ‘available in German’.

Which might work if Linkedin was already very well known in Germany but as mentioned in my other postings: Germans only know about what they have read about before in traditional media. If you are not available in German media all the time (media, not blogs) people don’t know about you. And then you need to do more than just “are you in yet?”. :)

Oh and of course I am curious if anyone can tell me which discussion group on Linkedin this link leads to, as I see it in my referrers but cannot access it. ;)

(End of update)

TC UK writes about “LinkedIn launches German site to take the fight to Xing“, writing about the significant growth of Linkedin and how few users Xing basically has. Missing the point once again: Of course in the general world wide market Xing looses out to Linkedin, but in the German market, Xing is the 800 pound gorilla, period. Did you ever wonder why all these great numbers from sites like Linkedin and Facebook never included one of the biggest markets in Europe? Germany has 82 million people living there, with over 60% of the grownups being online on a regular basis and it just ticks different to what you might used to be. For example who cares if Linkedin can IPO at any time when all of my colleagues are on Xing? [This of course is relevant to a site like Techcrunch, but not to the users of the system].

Let me first go into the more general aspects before adding more information what Linkedin says in German about their market ideas.

Why Linkedin and other services will fail

There is a lot of potential, but you need to understand the market and its dynamics. Then again, you get the list of things users are not satisfied spoon fed. It is really hard to to miss them. Not just the general complaints, but the complaints of dedicated, active, paying members on Xing who are ready to jump the ship. Pick up those and you get a head start in the game. (Then again, that would be smart.) Traditionally there is a simple approach to the German market, and it is never is a clever one. Most of the time, they just make a translation and try to tell everybody how awesome they are everywhere else, as if this is enough.

It is not. Me and others often wonder if they will ever learn. Take Facebook: boosting about their successes everywhere (including Germany), they fail to mention that it may seem like a success to have 2 million Germans in Facebook already but at the same time other new networks like “Wer kennt Wen” (who knows who) gained several million new members. It is embarrassing for them to claim how awesome they are when everybody knows they are not. Strongholds like StudiVZ who *have* the German market for young people, may be in problem because Facebook is the superior platform and StudiVZ is indeed a complete copy of Facebook 1.0. The German translation is a good step in the right direction, but it is not enough to transport american mechanisms to a german market. Mind you I am saying this as somebody who never had a StudiVZ account and never will have one.

With StudiVZ, you have an inferior to ‘the real thing’. Not so with Xing and Linkedin. Xing despite its many, many weaknesses still offers me *far* more than Linkedin ever will. Starting with superior search, superior address information, superior contact information – I have yet to see any other contact information on Linkedin than the mail address. Have a look at my Xing profile and see everything underlined – while you can only search as a premium member, everything in there is clickable = searchable. What you don’t see is the amount of contact details I get offered as a user to give to my contacts. Best offers are another example. Yes, the network is predominantly German / European based, but with a country of this size, it is far from being relevant that there are not *that* many users from all over the world. And Xing is not even really good at it. To give you another example: in the beginning they did not want to have the localized events, it was the demand of the users that forced this into xing (the current ambassador model was born out of this).

There are thousands of people cursing about Xing every single day – but still would take it in a heartbeat because it is better. I have been paying member of Xing since I started using in in March 2004. If I had to choose today which one to loose, Linkedin would go out first. But Nicole, what about your business contacts in the international world? Simple. They are on Facebook and there I at least have the phone number. Before somebody comes to claim that Linkedin works differently and real professional networks have the CEOs etc of companies – who are you kidding? Show me 100 CEOS who are active on such a platform and I bet you that nearly all of them have their assistants do the job.

In the world wide game Linkedin most likely is the winner, for the German market Linkedin will never be more than a “I am also in there because I have international contacts” network, no way a complete replacement for Xing. Especially not if they do not have a look at their competitors and its weaknesses. I mentioned StudiVZ for a reason: They try to get the finished students into another network called MeinVZ (VZ stands for Verzeichnis = directory and Mein equals My). The path after StudiVZ is MeinVZ or (if you want to be more professional) it will be Xing. Even Facebook is exotic to many.

Where Linkedin and other services can succeed

People will not leave Xing. Period. They may leave the premium membership, but they will not leave the mother ship of all contacts, especially not since Xing has contact information and Linkedin has not. Stop acting as if that would be the goal. You will not be the only one. But it can be the better one.

What Linkedin can do is be a new / second home to the many frustrated members with Xing who will likely also bring on their friends and colleagues. Meaning especially all the group moderators who have been asking, begging for years for features and another place to call home while at the same time not being able to move – because Xing is the de facto standard. This group will make an extra effort to get people over, and even the only slightly frustrated once will start to also use Linkedin in hope that this will force Xing to finally innovate on the things the users really want – and not gadgets.

Similar to Facebook the better strategy would be to take a look at these people who are running local events, seminars etc, and heavily make use of groups and events. If they pack up their groups and move, others will follow. Want to know what they are not satisfied with? The moderator group is full of these threads, and members of the group even make lists and track promises from Xing support. The complain thread about the ‘new event model’ is 86 forum pages long.

People will use different tools for different reasons

Being an early adopter just means being ahead of the rest. My world is connected and does not differentiate between different platforms as much as I ask for the right tool for the job. There are many things I really like about Linkedin (like recommendations, telling people when to contact you, some of the applications) and things which are missing. As people do differentiate between private and business, companies like Linkedin and Facebook should join forces for a market like Germany (or at least make an alliance) and work together with companies like Plaxo or Amiando and others to push the envelope in a direction the customer would want to go.

That is what people will pay for. Even in Web 2.0

Additional information:

(If you can read German, these are the relevant articles for you, I tried to put together the relevant elements in English.)

FAZ: Google trends clearly shows Xing in the lead
The article “Linkedin bringt deutsche Version” shows a lot of the google trend graphics, of which the relevant is the for the German market.

Xing / Linkedin in Germany

Kevin Eyres, responsible for Linkedin in Europe says they want to get German content onto the pages and make partnerships with German publishers for local content and especially job offers. This is highly relevant as the Xing model is a very expensive one but with their matchmaking also a successful one.

Focus Online: Not buying or cooporating with Xing
In Focus Online (“Wir würden Xing nicht kaufen“) Eyres is quoted in the headline with “we will not buy Xing nor cooporate” and claims that rumors about Linkedin buying Xing where only distributed by Xing and do not hold any truth. They are only interested in globally acting and thinking important business people and don’t consider active members to be as relevant for their platform than “Xing needs them to be”. Which basically implies that normal folks do use Xing while real bosses use linkedin – to which I again bring up the point that really important people have ‘normal folks’ to do such tasks for them.

Turi2 (“Linked-In startet mit deutscher Version Frontalangriff auf Xing.“) is the major media news service and has a lot of interesting comments about the comparison of Linkedin / Xing, especially about the american ‘spirit’ coming into the German market.

Added Linklist from my German posting “LinkedIn versucht den Markteintritt (Reaktionen auf Englisch und auf Deutsch)“:
Additional english links:

German links:

Also:

Tags:

16 Responses to “Linkedin taking the traditional approach in Germany and why that will fail (as usual)”

  1. andraz (Andraz Tori) says:
    December 31, 1969 at 23:59

    LinkedIn Germany promotional video. If I was German I’d be offended. http://tinyurl.com/ccapbs

  2. Michael Reuter says:
    February 4, 2009 at 05:30

    Very thoughtful post, Nicole! I agree with most of your points, but not with: “Xing despite its many, many weaknesses still offers me *far* more than Linkedin ever will. ” – especially the second part of the sentence. Don’t you underestimate Linkd-In?

    Another point: doesn’t have Linked-In the superior business model? I mean: a 5 Euro flat-rate might appeal to “end-users” (and to corporate users, too) but I think there is a huge loss of profit since Xing does not segment its users like Linked-In does. Or don’t you think that headhunters would not be ready to pay more than 5 Euros a month?

  3. Nicole says:
    February 4, 2009 at 05:34

    Currently Xing is superior in functionality (thought lacking a lot). Assuming that Linkedin will innovate and press for new features, I expect Xing to play catchup as well. Can they screw that up? Of course.

    And as a user, I do not care about a more expensive business model. By experience, when I try to contact people I do not go through Linkedin channels – I reach them through other ways and yes this includes people higher up the chain.

    Headhunter obviously already pay more then 6 Euros as I was informed that every decend headhunter has at least 2 profiles. ;))

    Is there more money to be made? Yes. I even think that if set up differently the premium buisness modell for groups would have worked. So potential for money earning all all sides. ;)

  4. Michael Reuter says:
    February 4, 2009 at 05:40

    Nicole said: “Is there more money to be made? Yes. I even think that if set up differently the premium buisness modell for groups would have worked. So potential for money earning all all sides. ;)”

    Yes! Apparently there is monetization ahead ;-)

  5. Mark Masterson says:
    February 4, 2009 at 05:42

    Excellent, excellent write up. Spot on. I doubt the Amis will get it, though. It may not have surfaced on your radar, but I wrote extensively recently about the underlying cultural concerns, here: http://blog.enterprise2open.com/2009/01/27/can-social-software-work-in-germany/

    I’d sure welcome it if you could find the time to have a look, and perhaps even be cruel to me with a comment? ;)

  6. Andraz Tori says:
    February 4, 2009 at 12:36

    Hi Simone,

    having seen some similar examples in Slovenia, I have to say you are right. Localization is not everything.

    But you are forgetting one thing when talking about Facebook And LinkedIn vs. local players. Time and war chest. They do not need to immediately reproduce the success they had in US market. They will be persistent and gain market share over few years, buy a few smaller local players and slowly try to drain out competition. This especially goes for social networks, migration is slow and you cannot really force it.

    The same happened with local search engine here. While it still has a majority market share, each year Google’s localized version is taking some percentage from them.

    bye
    Andraz Tori

  7. Nicole says:
    February 4, 2009 at 12:39

    @Mark nice article!

    @Andraz Absolutly. Just that Xing’s war chest is not small either. It is not comparable to Linkedin, but the home should be save – if they do not screw up, which is usually the problem. ;)

    Buying up: There is no one else to buy up in the German market which plays in the same niche as Xing, only StudiVZ but that would be a long shot and I doubt they want to play Facebook. It will stay interesting and if it brings any innovation – I will be happy to see it on both platforms.

  8. Andraz Tori says:
    February 4, 2009 at 12:48

    Yeah, I know Xing is no dwarf either. I am sure we can look forward to a few years of exciting battle ! :)

    bye
    Andraz Tori, Zemanta

  9. Bryan Coe says:
    February 5, 2009 at 13:07

    Nicole, this is a great post. I’m always surprised at how many international companies don’t understand the value of localization when attempting to enter a new market. This is another good.. or should I say “bad” example.

    Your statement sums it up, “Most of the time, they just make a translation and try to tell everybody how awesome they are everywhere else, as if this is enough.”

    BTW I also posted this to my blog.

  10. Misty Faucheux says:
    February 5, 2009 at 13:22

    Hi, Nicole:

    I think that Linkedin definitely needs to do a little better outreach to overtake Xing. I love how your broke everything down.

    Thanks for doing all the research.

    Misty Faucheux
    Social Media/Community Relations Manager, Viscape.com
    http://www.viscape.com/users/mistyfau

  11. Francisco Otto says:
    February 6, 2009 at 16:12

    Hey Nicole,
    der aktuelle Link zu dem Video ist:
    http://www.youtube.com/watch?v=vvu4x5v75_I
    LG
    Francisco

  12. Nicole Simon says:
    February 7, 2009 at 09:36

    I wanted to include the list of collected links when I update, but still thanks for giving me the link Francisco :)

  13. Ted Shelton says:
    February 7, 2009 at 09:59

    No debate on the points you raised and ALL of the US companies that enter European language markets find it hard to get this right — lots of opportunities for collaboration or competition… but in something like social networking, especially business social networking, there is an enormous advantage that a global player will have over a local German player. The world is flat! We all need to be thinking about global markets — LinkedIn needs to be smarter about being localized, but German business people need to be smarter about doing business social networking with everyone around the world, not just folks in Germany.

    I think that LinkedIn will get localization right faster than Xing will get globalization right. So in the long run LinkedIn will win. In the short run, smart business people will use both.

    http://www.linkedin.com/in/tshelton
    http://www.xing.com/profile/Ted_Shelton

  14. Konstantin Guericke says:
    February 7, 2009 at 17:28

    One of the best posts and set of comments I have seen on the topic. LinkedIn has waited long (too long for my taste), and it will take significant effort and patience to win over many segments of German professionals. As some articles have pointed out, LinkedIn will appeal to certain segments and can get critical mass there. Also, many will choose to have two profiles. Third, LinkedIn is not dependent on earning a lot of revenue from the German market, so German professionals are likely to benefit as they have more of a choice and LinkedIn will work hard and patiently to entice German professionals to give LinkedIn a try–both those are already on Xing and those (by far the majority) who have not yet joined any professional network.
    LinkedIn is designed to be efficient for the busy professional, and this design has already proven to be more attractive than those of local competitors in every country of Europe (and the world) except Germany, Austria and Switzerland. The powerful business model also enabled LinkedIn to be profitable while allowing virtually all members to enjoy most of the valuable search and contact functions free of charge. There are about a dozen significant pieces of functionality in LinkedIn that will take some time to get noticed, but I believe will sooner or later gain in appreciation.
    Based on its worldwide scale and significant resources (and not having to worry about fickle public-market investors interested in short-term profits), LinkedIn is evolving quickly, and German/Austrian professionals will be the ones that benefit the most (LinkedIn is already quite strong in Switzerland due to the importance of international business in the Swiss economy).
    Disclosure: these opinions are my personal ones and are not an official statement of LinkedIn.

  15. Mark T says:
    March 5, 2009 at 12:26

    Thank you for your writeup.

    I would like to point parts of your article where I strongly disagree.

    Your comment “Of course in the general world wide market Xing looses out to Linkedin” could be a serious problem for Xing. The world is small already, why would I choose a network that is mostly limited to the DACH market? I work in Germany, but have extensive contacts in Scandinavia, UK, and Benelux. I dont have a single contact abroad who is using or has considered using Xing. Everyone is on Linkedin. In fact, several IT newspaper publications in Benelux print the number of Linkedin contacts each person named in an article has.

    You wrote “Germany has 82 million people living there, with over 60% of the grownups being online on a regular basis and it just ticks different to what you might used to be.” Yes, it ticks different, but with young Germans, B-school Germans, and hundreds of thousands of Germans living abroad (especially at muti-national firms), the game in the local market is really not all that different. Most of these individuals realize that they will need to do a rotation in another part of the world to climb up the corporate ladder. Meaning that international connections are critical to getting that position in Shanghai, etc.

    About 90% of my German colleagues are using the two account system with both Xing and Linkedin. Why are they using Linkedin – same reasons, for the international contacts.

    While im happy that there is some competition left in the marketplace, I dont see how Xing will be able to grow furthur in the 2-3 year range being limited to mostly the German speaking regions of Europe.

    Just my personal observations…

  16. Pam says:
    July 2, 2009 at 17:11

    Wondering who will fail and who will succeed in the market place in 2009 – is it Twitter, LinkIn or Facebook? I am overwhelmed with a lot of ‘yes’ and ‘no’ answer for all these three.