9th Jan 2013
Professional networking site LinkedIn has admitted to a bug in its self-serve advertising platform which is costing UK businesses thousands of pounds, according to a social media expert.
Mike Tinmouth, founder of social media consultancy TheSociaPro, identified a fault in the billing system on its advertising platform which meant that GB pounds were being displayed as the same value as US dollars.
Tinmouth remarked that LinkedIn had recently introduced a change in the way it bills customers for self-serve ads, which allows them to pay in GBP as well as USD. The system works on a bid process, with the minimum bid being US$2, yet an identical ad in GBP costs £2, so there is no conversion being taking into account, he said.
"If you are in the UK you can still register your account in USD, but intuitively I would suggest that most people, when faced with the option of paying in pounds or dollars, would probably go for the pound option. So whilst they have the option of paying in dollars, they are basically losing out by whatever the exchange rate is – at the moment it is about 1.59. So in essence to pay for exactly the same ads, in exactly the same position, they are paying 1.59 times what they need to pay."
He added: “There is a minimum spend of £10 per day, so even if you ran a one-day campaign you are losing out by 1.59 times on £10. You add that up against all of the UK advertisers – which LinkedIn wouldn’t disclose – and it is probably thousands of pounds over a three or four month period.”
Tinmouth first noticed the flaw last month and contacted LinkedIn immediately, but didn’t receive a reply until this week.
A spokesperson for LinkedIn said: "As part of our ongoing efforts to provide a more locally relevant experience for our members wherever they are, we recently introduced the option of non-$US payments for self-serve ads. We’re aware of a bug which means the GBP minimum bid is displaying the same value as the minimum USD, and are planning to change this in the coming weeks. Until then, we offer members the choice to pay in USD or a range of other widely used currencies."
Tinmouth remarked that it will now be interesting to see how the network deals with fixing the bug.
"LinkedIn could potentially lose a lot of money because an ad would drop from the minimum price of £2 to around £1.30 – it will be a significant drop in revenue for them. It will be interesting to see how they deal with it."
Meanwhile, LinkedIn has today announced that it now has 200 million worldwide users, with two new members joining every second.