When it comes to paid ads, LinkedIn is one of the go-to platforms. While other ad giants like Facebook and Google may have a monopoly on ecommerce products, LinkedIn has a unique position when it comes to B2B marketing, as the entire platform is built around businesses and employees.
Therefore, it’s no surprise that B2B businesses gravitate to LinkedIn when wanting to run paid ads. The struggle with paid advertising, however, is the “paid” part. After all, it’s great to invest in your marketing, but you likely want to know exactly how much you will be paying and how the payment process works.
As the owner of a LinkedIn Ads agency, I have some unique insight into this, and I hope to help you figure out the answer to this question and maybe even create a successful LinkedIn ad campaign in the process.
Factors that influence LinkedIn Ads costs
As I’ve mentioned in my post about how much Facebook Ads cost, it’s important to understand that the amount of money you will spend on paid advertising isn’t set in stone.
There are so many factors that influence your LinkedIn fees, and understanding these is the key to helping you figure out how much running ads for your specific business will cost.
1. Campaign objective
People have different goals that they want to achieve through their paid ads, and these goals will affect the price. For example, if your aim is only to get clicks, your ads will be cheaper than if you want to get full-on conversions, since a conversion is much more valuable than a click.
2. Target audience
The same goes for your target audience. If you are going after the big guys – the CEOs, the highly sought-after customers – you are naturally going to be paying more. Similarly, if you are in a highly competitive sphere, you will also need to accept that you will need to spend more on your ads.
3. Ad format
LinkedIn has a variety of ad formats, and these will also affect your ad spend. For example, video ads tend to have much higher engagement rates when compared to ad formats like text ads, which means you’ll be paying more for them.
4. Bidding strategy
LinkedIn uses a bidding strategy for its ads, similar to Google Ads. This means that you will be paying for each click, impression, or message sent (depending on which ad type you select.) Therefore, you need to have a bidding strategy in place to help you make the most of your budget.
5. Quality of ads
LinkedIn Ads will also reward a good advertising campaign with a lower LinkedIn Ads cost and better placement. Make sure that your ads utilise unique creatives, memorable copy, and relevant targeting. The better the quality of your ad and the more relevant it is, the better. LinkedIn will give you an ad relevance score which will impact your ads.
6. Ad optimisation
You need to also make sure to continuously optimise your ads. Monitor them, think about ways you can improve, and implement steps that help you use the data gathered from your previous advertising campaign to improve upon your next round of ads.
Determining your LinkedIn Ads budget
Now that you know which factors impact your LinkedIn Ads budget, it’s time to figure out what you want to spend. Luckily, LinkedIn allows you to pretty much set your own budget – although that doesn’t mean you should aim to spend as little as possible just because you can. To learn more about the minimum you should spend on paid ads, click here.
1. Have clear goals
As discussed, your goals impact your budget, so it makes sense that you need to have clearly defined goals from the get-go. You then need to ensure that you have a realistic budget that allows you to turn these goals into a reality.
2. Know your audience
Since your audience also impacts your LinkedIn Ads budget, you need to know your audience. The better you know them, the more effective your targeting will be as well. This means that you won’t be wasting money on showing your ads to people who don’t care – instead, you will be targeting people who have a high likelihood of being interested in what you have to offer.
3. Keep average costs in mind
While your ad spend will be affected by all the costs mentioned earlier, there are certain industry trends that can help you determine a benchmark of more or less what range your ads will fall in. You can look at average ad costs for other businesses in your niche so that you have a better idea of how much to estimate for your ad spend.
Make your LinkedIn Ads budget work for you
It’s important to note that determining your LinkedIn Ads budget isn’t enough; you also need to figure out how to make your budget work for you, so that you can make the most of your ad spend.
1. A/B test
You don’t know which ads will work for you. Neither do I. So, how do you go about figuring this out? You A/B test. You test one creative against another. And you do the same thing with your copy, your ad formats, and your audience. Then you see which one works best, and you can do further testing on that. This way, your ads are being determined by data.
2. Segment your audience
Good ads require some work, so don’t be lazy. Don’t just have one big audience, but segment your audience into smaller categories based on demographics so that you can deliver more personalised messages to that audience.
3. Optimise your bids
Part of running successful ads means having a good bid strategy, and to do this, you need to optimise your bids. You can try different bidding strategies, or even test different bid amounts.
4. Schedule your ads
Here’s a pro tip: you can schedule your ads! If your ads perform really great during a certain day of the week, you can schedule ads to only show on that day. This can greatly help increase your chances of engagement.
5. Optimise your landing pages
Gone are the days of sending people to your website, and in are the days of creating custom landing pages for your different ads. This offers a much more personalised experience.
6. Reallocate your budget
When you first run ads, you’re going to allocate a substantial budget to each ad. But over time, some ads will perform better than others, so it only makes sense to reallocate some of your ad spend to those well-performing ads and cut back on the ads that aren’t doing well.
7. Track your conversions
Finally, you need to track your conversions. Getting a conversion is great, but it’s even better if you know where the conversion came from. That way, you can accurately track which ads turn clicks into conversions.
Final words
Paid advertising can be scary. But it can also be great. Remember that any type of marketing is an investment, so the idea is that your money will eventually turn into more money. However, you need to know how much to spend on LinkedIn Ads, and the only way to do that is to know which factors affect your ads.
I hope that this post gave you some helpful insight into this, but if you do feel like you need professional help with your LinkedIn Ads, fill in the form below to get in touch with my ads agency!