LinkedIn is the world’s largest online database of active professionals working across all sorts of industries, making it a premier advertising hub for B2B companies and some B2C brands. If your business works with business professionals, you need to take advantage of LinkedIn’s advanced targeting and display features. Whether you’ve been running LinkedIn ads for years or have never even set up an advertising campaign, this guide is meant to cater to individuals of any level through both curated and original content.
What to Know Before You StartMost people view setting up an online advertising campaign as a daunting experience, and for good reason. Essentially, online advertising doesn’t have any barriers of entry and it seems rookies are pitted against experts. But is this really the case? The answer is, no. Not really. If you’re only spending a couple hundred bucks per month, having an expert optimize your campaign probably won’t be worth it. Unless your campaigns are woefully under-performing, their tests and improvements will only have an incremental impact on your overall campaign due to a relatively low spend volume. This doesn’t mean you shouldn’t have someone creating and optimizing your LinkedIn campaigns; it does mean that you shouldn’t pay a top consultant several hundred dollars per hour, however. You’re better off running the ads yourself, or mixing it into one of your marketing team member’s day-to-day responsibilities. What happens if I don’t see a positive ROI in the first month? This can actually be a long answer, and it’s not as black-and-white as it may seem. You cannot say for sure one way or the other unless you establish these key variables:
- What is your budget?
- How much are you willing to lose?
- What is the lifetime value (LTV) of a customer?
- What is the main goal of your campaign?
- Do you have multiple assets and call-to-actions (CTAs) to test?
- What will it take to break even?
- How many A/B tests have you run?
Setting a BudgetWhether you’re a F500 company with an elastic budget or a lightly-funded startup just looking to gain some traction, LinkedIn allows you to work within your parameters. The minimum daily budget for LinkedIn is $10.00, a modest amount that just about any business can afford. Keep in mind that LinkedIn cost per click (CPC) on average range from $2-$7 per click, and we’ve seen it go as high as $11 or $12. The price of the click is determined by your targeting demands, current inventory, and the demand for your audience. While setting a budget is a decision for you and your team to make, use the average LinkedIn prices to determine what you can actually get out of a campaign and to set proper expectations. For example, if your customer lifetime value (CLV) is $150, then you know you absolutely must stay under $150 to acquire that customer and you should aim much lower. A successful campaign should acquire as many customers for as cheaply as possible, so in this scenario you should try to acquire the customer for under $100. With that in mind, you now have enough information to do some rough math to ensure you’re on track to hit your goals. Assuming you’re paying an average of $5 per click and you’re converting visitors at 4%, you’ll spend $500 for every 4 customers and you’ll make $600 over the lifetime of those customers. Technically, that campaign will generate a positive ROI, but if you increase your conversion rate to 6%, it will cost you the same amount and you’ll make $900 instead of $600, a revenue increase of 50%. If you’re running campaigns at scale, that’s a major revenue increase.
Click-through Rate BenchmarksAs digital marketers, we like to think in terms CPC, click-through-rate (CTR), engagement, impressions and so forth. Whether we view them as vanity metrics or key performance indicators, it’s helpful to see some industry benchmarks through LinkedIn ads. A good rule of thumb is that you should see your LI Sponsored Update ads perform at or better than a 0.10% CTR, but you should shoot for .30% and above. The reason is that an ad that attains more engagement will be shown more continuously than an ad that receives little to no engagement. This is how LinkedIn knows an ad is or is not resonating with their audience. If you receive over 1% engagement rate, then you’re really killing it. So much so that you should keep a copy of this ad and test that image and copy across other ad channels and your site, which can boost conversions throughout all of your acquisition channels. .@LinkedIn rewards advertisers who regularly update ad copy & images with better engagement and a lower cpc. Click To Tweet Linkedin rewards advertisers who regularly update ad copy & images with better engagement and a lower cpc. If you don’t update your copy and ad details, your engagement will drop dramatically. This above image is from a campaign we ran and neglected. Needless to say, we learned our lesson. For LinkedIn text-ads, your CTR is almost always going to be less than Linkedin Sponsored Updates. A typical text-ad CTR typically is between 0.005% – 0.020%, although it can vary greatly depending on your offer, targeting and copy.
Tracking LinkedIn AdsOne of the pitfalls marketers tend to fall into is that they don’t properly track their ad spend. This can be a costly mistake. For LinkedIn, there’s several ways you can track ads:
- Creating a different or duplicate landing page for each ad group
- Using custom UTM parameters for each ad group to track in your analytics and automation platform
- Leveraging Bitly links to track clicks
- Setting up goals in Google Analytics
- Passing Lead Source into your CRM
Ad TargetingDue to LinkedIn’s sheer size and public information, it offers excellent targeting options for advertisers. You can target by:
- Company name (up to 50) or Industry
- Company size, titles, location, seniority, age, education, skills and more
- Excluding certain titles or companies, such as interns and competitors, for example
Scenario 1:Industry: Marketing & Advertising; Job Title: Marketing Manager, CMO, VP of Marketing; Company Size: 50-200 employees+, Location: North America, England, Netherlands, Oceania
Scenario 2:Company: insert (up to) 50 ad agencies you’d like target specifically; Job Category: Marketing; Seniority: CXO, Director, Manager, Location: North America, England, Netherlands, Oceania
Scenario 3:Location: North America, England, Netherlands, Oceania; Industry: Marketing & Advertising; Skills: Digital Marketing; Function: Marketing; Seniority: CXO, Director, Manager You should experiment with multiple targeting options, ad copy, landing pages and CTAs to perfect your ad performance.
Audience Expansion: What is It?Audience Expansion is a beta ad product that LinkedIn has been developing, and it’s by default applied to every LI ad campaign unless you disable it. Basically, AE extrapolates your desired targeting options to reach other individuals who are outside of that group but share some similar qualities. Enabling AE doesn’t lower your cpc, and if you have very specific ad-targeting requirements it can generate less-desirable leads for you. Our advice: only use Audience Expansion if you can afford to target a larger pool of people. If you have a very specific requirement, such as CMOs of 500+ employee companies, then don’t use Audience Expanionsion.
Case StudiesOnce you have the basics nailed down, you should focus on improving your campaign. Otherwise, what’s the point of spending all this time learning how to create LinkedIn ads if they won’t be effective? We’re always looking to improve our campaigns. One of the main ways we do this is by looking at other LinkedIn advertisers to see what they’re doing (right and wrong) in addition to how their ads are structured and how they seem to be performing.
Mercedez-BenzMercedez-Benz did a good job creating an attractive video image, but unfortunately they did not create their copy to match LinkedIn’s character limitations. This leads to “…show more” messages and text cut-offs. In addition, they don’t have a clear CTA. Why should their visitors click on the ad and watch the video? Since Mercedez-Benz is a high-end automotive company, it makes sense to advertise on LinkedIn. They can target executives, financiers and successful entrepreneurs. Also, they’re not trying to drive direct leads. They’re building awareness and reminding their target audience why they’re working so hard and taking on so much responsibility.
Hired, Inc.Hired, Inc. a startup focused on improving the technical recruitment industry. Their Sponsored Update stood out to us for a number of reasons:
- Personalization: Our writer is located in Boston, hence the “iOS development opportunities in Boston” messaging
- Clear Value Proposition: Who is Hired? What do they do? Why should I care? These are the questions we subconsciously ask ourselves when we see an ad. The answer? They’re a marketplace connecting developers to tech companies with transparent career offerings
- Witty Image: Their image speaks to developers and their mission of connecting developers to top tech companies
- Targeting: While our writer is based in Boston and has some tech skills, he’s not a developer and nowhere on his profile does he have “iOS development” listed.
- USP: While Hired has a clear value prop, their messaging could be even better–are they just connecting tech talent to companies? The answer is no, but that’s the extent of their ad. The truth is, they only connect top tech talent to tech companies, meaning you need to be approved to be on their platform to ensure quality control. Most talented developers would appreciate this and it would help them stand out. Body text: The body text in their ad is too long and was cut off.