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How bidding works

Space for advertising is limited, so marketers compete in ad auctions by bidding. You compete against other advertisers targeting the same audience. Based on demand for your target audience, you may pay less, but never more than the bid amount you set.

When you create a campaign in Campaign Manager, the advertising platform on LinkedIn, you’ll choose your bid type and set your maximum bid.

Why bidding matters

If your bids are too low, your ads will not get delivered and the audience you want to reach won’t see your ads.

You can’t bid “too high” because LinkedIn runs a second-price auction, which means you only pay the minimum needed to win the auction, not your maximum bid. However, smart bid management will improve your ROI and ensure you’re spending your marketing budget where it matters most to your business.

Types of bids

For Sponsored Content and Text Ads, you can bid in three ways: cost per click (CPC), cost per 1,000 impressions (CPM), or enhanced cost per click (eCPC). eCPC is auto-optimized, and you cannot set a limit on the maximum bid.

Sponsored InMail bids are cost per send (CPS), which means you pay for each sent message if you win the auction.

How to choose the right bid type

If you’re running a Sponsored InMail campaign, you can only make CPS bids, so skip ahead to bidding best practices.

For Sponsored Content and Text Ads, consider the goal of your campaign:

•  If you're just starting out, CPC tends to be the easiest bid type to understand and optimize for. So use it if you plan to test and develop your own strategy.

•  If you’re driving leads or content downloads, start with CPC bids. You’ll only pay when someone clicks on your ad.

•  If you're focused on thought leadership and branding, impressions of your ads might be more important than clicks, so try CPM bids.

•  If you’re focused on conversions and driving at least 70 conversions per week, try eCPC. This bid type is auto-optimized to decrease CPA and increase conversions. 

Here’s one easy test to compare pricing models:

    1. Create two campaigns with the same ad creative and target audience.

    2. Select CPC bidding on one, and CPM on the other.

    3. Run both and compare results when you have enough data.

Bidding best practices

When you create a campaign in Campaign Manager, you can set your bid, budget, and scheduling. Use these tips to get started with a smart bidding strategy:

•  Bids and budgets work together to support campaign performance. Learn the best ways to get started with your budget.

•  Start at the high end of the recommended range. Campaign Manager will suggest a bid range that makes your ad content most likely to be seen. For a strong start, bid toward the top of that range.

•  If your campaign is not winning auctions, your ads are not being seen. Try bidding one or two dollars above the suggested range to increase chance of winning. You will only pay the minimum needed to win, not your maximum.

Optimize your bidding strategy

Optimizing your bids means getting the strongest results for every dollar of ad spend. Try these tips, build on the tactics that work for you, and create a strategy that’s unique to your business.

•  Access your campaign insights to understand how your ads are performing and get recommendations to improve bids and budgets.

•  Try reducing your bid slowly to find your ideal level. Monitor campaign performance and stop lowering the bid amount if you see a dip in key metrics (like impressions, clicks, or conversions).

•  Experiment with changing your bid type to see how it affects the delivery and performance of your campaign. For example, if you’re bidding by cost per 1,000 impressions (CPM), you could change the pace of your ad spend by switching to cost per click (CPC).

•  Increase website traffic to use eCPC. Once you’re driving at least 70 conversions per week, this auto-optimized bid type can help you decrease CPA and increase conversions.

•  Select Audience Expansion to reach more people who are similar to your target audience. This increases the number of people seeing and clicking on your content, which generally decreases the bid needed to win.

For Sponsored Content, here are some additional tips:

•  LinkedIn assigns a relevance score to all Sponsored Content based on indicators that LinkedIn members find the ads interesting (like clicks, comments, and shares).

•  It’s possible to win with a lower bid if you have a high relevance score, so focus on the quality of your ad creative with the goal of improving your click-through rates on every ad.

•  Bid high at the start of a campaign to get traction. This helps boost your relevance score.