It might not have the reach of Facebook, the visual appeal of Instagram or the comical, witty responses of Twitter, but there’s one thing LinkedIn does have – something that makes it a far more valuable marketing channel for B2B brands:
61 million LinkedIn users are senior level influencers and 40 million are in decision-making positions:
If you want to connect with the decision makers at your ideal-client businesses, LinkedIn is the place to be. But if you are having difficulty connecting with them, creating LinkedIn ads can help you get their attention.
This guide will help you decide if LinkedIn ads are worth your spend and walk you through the process of creating a campaign from scratch, along with handy tips on how to maximize the ROI of your ad spend.
How Does LinkedIn’s Advertising Platform Stack Up?
LinkedIn has recently revamped its entire advertising and marketing offering into a new suite: LinkedIn Marketing Solutions. It has a ton of new features, and the good news is that it’s also easier and more intuitive to use than the old system.
Before we dive into the details, let’s take a look at how LinkedIn ads perform compared to other ad platforms so you can determine if they will generate a positive ROI for your spend.
LinkedIn’s Reach vs Other Platforms
According to the latest statistics, LinkedIn isn’t even in the top 20 most visited sites, while Google, Facebook and Twitter are all in the top 10:
LinkedIn currently sits at number 28. You might be thinking: why bother then?
Secondly, it’s not all about reach. For advertising, having more potential eyes on your content is meaningless if they’re the wrong eyes. If you’re thinking about advertising on LinkedIn, you’re looking for engaged B2B leads. That’s where LinkedIn excels.
When deciding which platform to advertise on, the real question is: “Will I get value from LinkedIn?” To answer this question, let’s look at the engagement and conversion rates across platforms. This will give a clearer picture of how they compare.
LinkedIn’s Engagement vs Other Platforms
We analyzed the engagement across platforms by looking at the average click-through rate, cost per click and conversion rates across industries in a previous post about Twitter ads (for an in-depth analysis of how these we got these figures, check it out – it’s a cracking read!).
Take a look at the results:
Now let’s add in the figures for LinkedIn.
AdStage analyzed LinkedIn’s performance in Q4 of 2018, looking at 2 billion ad impressions and over 5 million ad clicks. The result was a median CTR of 0.26%. This doesn’t compare well to the other platforms, although it is on an upward trajectory when you look at the year as a whole:
This chart also shows that the max CTR was approaching 0.8%, so it’s at least possible to reach the levels of the other platforms.
In terms of CPC, AdStage put it at $3.72 and on the decline:
In a survey of all its customers, HubSpot found an overall conversion rate of 9% from LinkedIn ads.
Now here’s an updated table that includes LinkedIn:
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Should You be Advertising on LinkedIn?
A quick glance across these numbers isn’t a glowing reference for LinkedIn ads. However, the conversion rate is what’s important.
To demonstrate this, I’ve crunched the numbers into a table telling us how much a lead costs on each platform, given a $1,000 budget:
This shows that, although LinkedIn’s numbers looked weak initially, it actually provides the second-best value per lead.
Facebook is out in front as you might expect with its decent CPC and high conversion rate. Twitter’s poor conversion rate makes it the most expensive by some margin. And Google Ads doesn’t fare much better, losing out because of its relatively low conversion rate.
Of course, this is not an exact science, but it does give you an idea of how the different platforms compare.
To work out your ROI from here, all you need to know is the value that each lead brings you. If the lifetime value of each lead brings in more than $41 from your LinkedIn ads, you have a positive ROI.
Conventional wisdom says you should be aiming for at least a 4:1 ratio, so for LinkedIn ads, if each lead brings you at least $400, you know you are looking at a very healthy ROI.
Clearly, marketers are finding value in LinkedIn ads. A Digiday survey of 290 media buyers using LinkedIn found that 42% of them plan to increase their ad spend on the platform in 2019. And a further 47% said they expected to keep budgets the same.
For B2B marketers, LinkedIn is particularly important. Simply put, it’s a must if you deal directly with other businesses because 92% of B2B marketers include LinkedIn in their digital marketing mix:
With the advanced targeting and forecasting tools now offered and the user base growing, there has never been a better time to advertise on LinkedIn. Click To Tweet
Dive Deeper: 9 Rules for Creating Ads that Convert
Setting Up Your LinkedIn Ads
For the basics, check out our guide on how to get started:
In this post, we’ll dive a little deeper into the new format and give you some tips to boost your ROI from LinkedIn ads.
The new objective-based campaign manager walks you through the process of setting up your ads, which takes the opposite approach from the previous one. Rather than creating an ad and then choosing the target audience and where it will be placed, you start with the objective and work backward from there.
It makes sense this way round. Choosing your objective first means that all the decisions you make about the type of ad, the audience, the budget, etc. are based on your objective.
After all, if you were planning a road trip, you wouldn’t start making decisions about which way to turn without knowing where you want to end up. To do that, you need to know your destination before you set off.
The same goes for any ad campaign. Your ultimate objective should influence every decision you make.
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Getting Started with Your Ad
Log in to the system and create a new campaign. You’ll see this screen:
The objectives are split into three categories, aligning with the buyer’s journey stages:
- Decision (or, from our point of view, Conversions)
Choose Your Objective
Let’s take a look at the options so you can make this crucial strategic decision:
This objective focuses on driving traffic to your website, landing page or LinkedIn Company Page. It allows you to capture leads, give them more information about your product or service or sell to them directly.
If you’re looking to grow your audience, this objective deals with how many users engage with your content. It is used to drive followers to your Company Page and increase social engagement, shares, comments, etc.
Use this objective to get more eyeballs on your videos by sharing them with more people. It helps you target the people who are most likely to view your videos to increase engagement and clicks.
Note: Brand Awareness, Website Conversions and Job Applicants are all grayed out and billed as “coming soon”. But LinkedIn advises using the Website Visits objective, choosing “Automated Bid” and maximizing for “Impressions” for Brand Awareness, “Conversions” for Website Conversions, and choosing the appropriate ad format for Job Applicants.
Once you’ve chosen your objective, you are taken to the next stage where you select who you want to see your ad.
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Choose Your Audience
Choosing the right audience is crucial to getting the best ROI from your campaign. Paying for 1,000 views from interested parties is far better than paying for 1,000,000 views from people who will never bring you any revenue.
Happily, there are a ton of new features that make it a lot easier to target the right people.
Here’s what the Audience dashboard looks like:
As with all the major social ad platforms, you can target by location and demographics like age and gender, which are all very useful.
But LinkedIn really comes into its own with its business targeting options. You can dive into specifics, targeting by industry, job title, education, job experience, and interests (based on which LinkedIn groups people follow).
It’s in the individual’s interests to make sure that this data is up to date and accurate. With LinkedIn, you can be pretty sure this data is legit, whereas on platforms like Facebook, people often give false information or hide personal data. This makes it a very powerful targeting tool.
In the above example, we’re targeting people who are connected with anyone at IBM, Apple or Tesla, in the IT services industry at a senior level.
Being able to drill down to this level of detail has huge potential to boost your ROI. And it’s something unique to LinkedIn advertising.
There are a couple new features we should look at in more detail.
Targeting by Company Connections
This feature allows you to leverage other people’s professional networks to target like-minded individuals. It only includes first degree connections to the employees of companies with over 500 employees, so the likelihood is that these people actually know each other.
Lookalike audiences changed the game when they were introduced by Facebook, allowing marketers to target people similar to their best customers, thereby reaching a far larger audience of similar individuals.
A recent study of Facebook marketing data shows that Lookalike audiences make up about 60% of overall spend in Facebook advertising campaigns.
The good news is that this feature is now available on LinkedIn! Just be careful not to overuse it. If you are running a campaign with multiple audiences targeting different demographics and you’re using Lookalike audiences to target similar people, there’s a risk of audience overlap.
If the same people are seeing your ads multiple times, you risk audience fatigue which could damage your reputation and hit your conversion rates hard. Effective management of your campaigns will reduce the risk of this happening.
Choose Your Ad Format
LinkedIn offers eight formats. As you can see, the handy Forecasted Results panel on the right-hand side shows you projected results for each type of ad, based on the audience you’ve selected:
This should help you choose the appropriate ad format, which will depend on your audience and what you’re hoping to achieve.
Note: Some of these ad types require you to set up a Company Page.
Set Your Bid
Now that your ad is ready to go, you need to decide how you’re going to bid for placement. You have two options:
- Cost Per Click (CPC)
- Cost Per 1,000 Impressions (CPM)
With the first, you’ll only pay when someone clicks on your ad and LinkedIn will try to show it to people they believe (based on past data) are most likely to engage with your ad (and make them money).
Your alternative is to pay for every 1,000 people who see your ad. If you write compelling copy with a high CTR, this can actually save you money and boost ROI. But it’s better suited for campaigns designed for brand awareness, where your goal is to get as many views as possible.
After you select the type of bid, you set the actual amount. LinkedIn will automatically recommend a range of bids based on what others are already doing. I recommend starting by bidding a little higher than the bottom of this range to make sure you get some decent placement.
You can also set a daily budget and LinkedIn will attempt to match your spend to that amount (although they do warn that your costs may be up to 10% higher than your budget).
I recommend that you start with a small daily budget of $10-20 when creating new ads. After a week or two, you will have a better idea of which ads are performing well and can increase your budget (and your bid amount) if that makes sense for you.
As you change the variables, the Forecasted Results will update. You can use this to optimize your bids and get the most for your money.
Pro Tip: If you are consistently coming in under budget, it may be a sign that your bid is not competitive enough to win placement. If this is happening, just bump up your bidding a little bit and you should see your number of impressions (and, hopefully, clicks) grow.
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Create Your Ad
Once you’ve set up your campaign it’s time to create an ad. For text ads, you’ll need to provide four key things on the left-hand side:
- Ad Copy
- Ad Destination
The ad destination is the page you’d like to send people to when they click on your advertisement. That can be a page that you or your business already have on LinkedIn or it can be any external destination by URL, such as a specific product landing page.
You’ll then need to add a catchy headline that grabs the reader’s attention at first glance. Try using emotional and rational trigger words to make sure that they click to read your ad.
Your ad copy should expand on your offer. Make sure to incentivize the reader to click through by highlighting the key benefits of your offer here.
Lastly, you should include a small, but eye-catching image. Avoid using anything complex or confusing because people will only see it as a small thumbnail for a quick second as they scroll past your ad. Many people choose to use their logo here. But do whatever makes sense for you.
Pro Tip: You can test multiple versions of the same ad easily on LinkedIn. Once you’ve finished creating the ad (in a few steps) you can easily duplicate it and return to this page to tweak the copy and images.
Set Up Your Billing and Launch!
If this is your first LinkedIn Ad, you’ll need to enter your billing information now. LinkedIn will not display any of your ads until this information is filled out and verified.
If you don’t have access to the company credit card or are waiting on someone else for this information, you can continue making new ads and campaigns simply by navigating away from this page (just return to the ads homepage) and continuing to work.
Your account will display a large warning until that information is entered and your ads won’t run. But there’s no reason not to get everything set up first.
Note: Once you add your billing information, it may still take a little bit of time before your ads start to run. LinkedIn has a review process through which they submit most ads, especially for new accounts.
Monitoring and Reviewing Your Ads
Once you create your first ad, the dashboard will transform into this:
Of course, it will be full of zeros until your ads start getting some traffic and data points to measure.
Once the data arrives, you’ll be able to use the charts here to track all the important metrics of your campaigns, like CTR and Avg. CPC.
Which metrics are “good” depends on your business and your marketing objectives, but generally you’ll want to focus on minimizing CPC and CPM numbers as that means you’re spending less per customer that you reach, maximizing the number of people you can reach with your budget and maximizing your ROI.
If you’re running multiple ads on the same objective (for example, generating leads for your PPC Advertising business), you should keep an eye on their comparative CPC. If you notice that one is significantly outperforming the others, you should put more of your budget into that ad. This will help you reach more people at a lower cost and maximize your ROI.
It’s important to also track the quality of clicks you are getting. To do this, you should set up conversion tracking in Google Analytics or a similar tool.
If you noticed that leads coming in via one of your campaigns are converting at an extremely low rate, you need to adjust that ad to better qualify your leads. Otherwise, you’re spending money to attract people who aren’t interested in your offer.
Likewise, if you have a campaign running with a low CTR or high CPC, but the traffic is converting very well comparatively, you might consider letting it run despite the engagement metrics.
At the end of the day, it’s CPA (cost per acquisition) that matters. So if you’re paying $2 per click, but converting 1-in-4 clicks, you’re actually outperforming the campaign that costs $1 per click but only converts 1-in-10.
For B2B marketers, LinkedIn must be part of your strategy. Looking at the numbers, it rivals Facebook as one of the most cost-effective ways to reach and engage a powerful audience.
On top of that, LinkedIn’s new ad platform makes the process intuitive and offers intelligent features to help you maximize your ROI.
As you run your campaigns, remember to keep an eye on the numbers over the medium to long term, but don’t worry about monitoring campaigns day-to-day too much. In fact, I’d urge you to avoid doing that. Campaigns fluctuate naturally every day and you could make poor decisions if you get wrapped up in those daily shifts. Just check in on them once every two weeks or so to make sure that your costs are reasonable and your leads are converting well.
If you need some help with your LinkedIn ads, that’s where we come in. Our results-focused digital experts can give you the level of support you need to get the most from your LinkedIn ads!