The Cost of Advertising on LinkedIn
The truth of the matter is that you do need the right-sized budget to compete effectively, make an impact, and demonstrate ROI to your business. However, there’s real value to investing that budget on LinkedIn. Campaigns may seem more premium in terms of initial metrics like cost-per-click (CPC) and cost per lead (CPL) but those leads and clicks usually convert to revenue at a far higher rate than those you pay for on other platforms – and that’s the calculation you need to bear in mind when thinking about ROI. The conversion rates that our own LinkedIn Marketing Solutions campaigns generate on LinkedIn mean our ROI tends to be higher on our own platform than others.
There’s a lot you can do to box clever with your LinkedIn investment, lots of techniques that will help you punch above your weight with the funds you have available. However, there’s no denying that the amount of money you invest does make a difference to the type of results you’ll generate. So how much do you really need to make advertising on LinkedIn worthwhile? And how can you then make sure you’re making the best possible use of that budget?
There’s definitely a perception out there that LinkedIn is for large enterprises who are able to focus big budgets on generating leads – and that smaller businesses get squeezed out because they can’t compete against those big budgets to reach audiences at scale. This just isn’t true. As these confessions show, a modest budget is enough to make a big difference to any business. LinkedIn can drive results throughout the funnel – and with 78% of buyers consuming at least three pieces of content before talking to sales according to the latest research from Demand Gen Report, there’s real value in a mix of campaigns targeting different stages of the buyer journey.
Here’s our top-secret insider track on how much you need to set aside, how to divide up and manage the budget effectively to meet different marketing objectives, and how to save money through LinkedIn’s unique range of value-adding tools.
How much budget do you need to set aside for a LinkedIn campaign to be effective? Here’s what our insiders and ex-Campaign Managers have to say:
Campaign Manager turned Marketer
"You don't need a million-dollar budget to be effective on LinkedIn"
You don't need a million-dollar budget to be effective on LinkedIn, but you do need to adapt your approach if your budget is on the conservative side. Don’t run hundreds of different campaigns on LinkedIn if that means you’ll only have a $10 daily budget for each. You will limit the number of people who can interact with your ad if you spread the budget so thinly. If your budget is small, start with two or three campaigns, spread your budget evenly across them, and you can then make data-driven decisions about which to invest in.
LinkedIn offers a range of different advertising formats to suit different marketing objectives – and different budgets. Choosing the right combination of formats will help you to drive the results you need as cost-effectively as possible.
"I would use Sponsored Content pretty much all of the time. It’s the halo ad unit that can work for almost any type of offer, whether for larger audiences or hyper-segmented ones. The value comes from the quality of leads and the engagement. It works great for gated content like checklists, cheatsheets, webinars, eBooks... and with Lead Gen Forms, you can create a seamless one-click experience for your audience.
Text Ads are likely to provide the lowest-cost option for reaching a target audience at scale. The downside is that they are only available on desktop and so I would use them for large audiences when you know that your landing page isn’t going to deliver a great mobile experience and so you want to reach people specifically on desktop.
Use Sponsored InMail when you want to drive audiences to free, in-person events or extra special access. It’s also great when you’re trying to make an impact amongst a very tightly defined audience as you can touch many more people than you could get a click out of with the other ad units, so you’ll reach and engage a higher percentage of your audience. The clicks you get from Sponsored InMail are likely to be the most expensive though, so reserve this for the most special offers."
LinkedIn Ads Pro
The way that you organise your budget through bids and spending allowances will have a big impact on how effective it is. As ex-Campaign Managers, we’ve spent a lot of time figuring out how to spend budgets in the most valuable way possible. That includes smart bidding strategies, and techniques for controlling spend and creating the opportunity to optimise campaigns. It also includes adjusting your approach to fit your particular campaign objectives.
Online Advertising expert
"It seems obvious, but don't forget to use the tools in Campaign Manager to help with your bidding"
It seems obvious, but don't forget to use the tools in Campaign Manager to help with your bidding. The range that Campaign Manager gives you is based on competition for your audience and is therefore a good guide. The recommended bid takes into account how much you want to spend each day. I find that the middle to high end of the suggested bid range is a good place to start. If a range is between $4.20 and $7.60 I’d go for around $6.50.
LinkedIn offers a range of free tools that can unlock greater value from your paid media investment: by helping to amplify your messages organically, increasing the rate at which you generate leads, and providing a wealth of in-depth, profile-driven detail on the audience you are engaging with. Driving organic engagement via your free company page and company updates will help to amplify your reach to existing followers for free – and provides a great testing ground for ascertaining which content and messaging to put your budget behind. Here are our ex-Campaign Managers’ other tips for leveraging free tools to grab greater value.
"Use Campaign Manager for free to track the demographics of users coming to your website"
Not a lot of people realise this, but you can actually use Campaign Manager for free to track the demographics of users coming to your website. Once you have set up your Campaign Manager ad account (which doesn’t cost anything, you just need a company page), you can grab an Insight Tag to place on your website. The Insight Tag will show you demographic info on your website visitors who are logged into LinkedIn. And you don’t actually have to spend a single dollar on LinkedIn advertising to get that. LinkedIn Lead Gen Forms for Sponsored Content & Sponsored InMail are another feature that I strongly advise people to use. It increases conversion rates dramatically and that reduces cost per lead (CPL). In fact, we’re seeing lead generation rates three times higher than those achieved using standard forms on landing pages.