LinkedIn has become a prominent social media platform for professionals and businesses. While it is widely recognized as a potent tool for business-to-business (B2B) marketing, it may be less commonly known that LinkedIn is also a valuable advertising channel for small businesses.
Kinsta’s data shows that LinkedIn receives a staggering 121 million daily users. This presents a huge opportunity for small businesses willing to invest in LinkedIn ads. The even better news is that LinkedIn ads are reasonably priced, and various methods exist to reduce expenses.
In the following section, we will explore strategies to minimize your LinkedIn ads expenses and determine the ideal ad type for your business.
Why Choose LinkedIn for Advertising?
While there are multiple platforms available for running ads, LinkedIn stands out for the following reasons:
- Large and engaged professional audience: With its vast and active professional audience, LinkedIn is an excellent choice for businesses targeting a specific niche or industry, particularly in the B2B.
- Robust targeting options: LinkedIn offers highly advanced targeting options, allowing you to tailor your ads to specific demographics and interests. You can create highly precise targeting by using the extensive user information shared on the platform, such as work experience, skills, job position, and location.
- High-quality traffic: LinkedIn users are typically professionals, making them more likely to be interested in your offerings. Moreover, LinkedIn ads are less intrusive, resulting in higher click-through and conversion rates.
- Relevance score: LinkedIn ads are scored on a relevance scale, indicating how likely a member is to take action on the sponsored content in your ad campaign. The higher the score, the more relevant the ad is to the audience. This means you can avoid wasting your ad budget on ads that won’t be seen.
How Much Do LinkedIn Ads Cost?
The cost of your LinkedIn ads is determined by the ad auction and the specific action you wish to pay for. This pricing model is known as objective-based pricing. For example, if you choose the Website Visit Objective, you’ll only be charged when someone clicks on the link to your website.
Every campaign objective comes with billable events, and you will only be charged if these events occur.
Here’s how it works:
- You set your bid.
- Your bid competes with other advertisers in the ad auction who are targeting the same audience as you.
- The auction is won based on the desirability of your target audience and the amount you bid.
The target audience for your LinkedIn ad is the group of LinkedIn members you want to reach.
Here are some of the campaign objectives that you can choose from:
- Brand awareness
- Job applicants
- Lead generation
- Video views
- Website conversions
- Website visits
How To Choose the Right Ad Type
Before calculating the cost of LinkedIn ads, choosing the type of ad that best suits your needs is important. Here are some factors to consider:
- Purpose: What is the goal of your ad campaign? Conversation ads may be the best choice if you want to engage with your target audience. However, if you’re going to deliver a targeted brand message with a call to action, you should consider using Sponsored InMail ads or Message ads.
- Audience: Who is your target audience? LinkedIn provides various targeting options that allow you to focus your ad campaign precisely. You should consider your audience persona to determine the type of ad that will appeal to them the most.
- Budget: How much money do you spend on the ad campaign? Some ads may cost more than others, as they have more impactful billing events.
- Desired outcome: What do you want to achieve with this ad campaign? Do you want to generate leads or increase website visits? If you’re unsure about the outcome of running an ad, it’s best to start with a simple objective like increasing website visitors.
Best Practices for Controlling Ad Spend and Reducing LinkedIn Ads Costs
The cost of LinkedIn advertising varies depending on the type of ad you choose to run. However, there are several strategies you can use to reduce your ad spending.
Adjust Recommended Bid
LinkedIn provides a recommended bid based on your campaign’s estimated outcome, competition, and location. However, you can adjust the bid to suit your budget. It’s advisable to bid below the recommended amount and regularly track your ad’s performance. If the ad is not performing well, you can increase the bid amount accordingly.
Break up Your Audience
Avoid the mistake of investing all your ad budget in a single group because LinkedIn doesn’t provide performance indicators for individual companies, job titles, or professional interests. Instead, create separate campaigns for each group.
For example, if your target audience is based on job functions, make separate campaigns for operations, finance, marketing, sales, etc. Don’t group them all together.
By segmenting your audience, you can obtain detailed data and identify which campaigns perform better. You can pause the underperforming campaigns and reallocate your budget toward the more effective ones.
Give the Right Offer
To reduce the costs of your LinkedIn ads, it’s essential to ensure that you are targeting the appropriate audience. LinkedIn offers various targeting options, so taking advantage of them is crucial. Additionally, ensure you’re presenting the correct offer to your target audience.
The type of offer you present in your ad will vary depending on the stage of the sales funnel your audience is in.
- Top of the funnel: Blog posts and infographics
- Middle of the funnel: Webinars, eBooks, and whitepapers
- Bottom of the funnel: Demo offers and trials
The more appealing the offer, the better your ad performance will be, so you may need to spend less money.
Advertising products that are difficult to visualize can pose a challenge when it comes to creating compelling ads. However, there are some strategies that you can try to improve your results:
- Use charts and graphs in your ad to present data visually.
- Include a call-to-action button in the ad to make it more engaging for users.
- Invest in high-quality visuals. While stock images are convenient, hiring a designer to create personalized visuals that align with your brand can be more effective.
In conclusion, LinkedIn ads can be a highly effective means of reaching your desired audience, but they can also be costly if not managed carefully. By following the best practices mentioned above, you can optimize your ad campaign and reduce expenses.
Alternatively, you may consider reaching out to Prospect Engine for assistance in running a cost-efficient ad campaign for your business. Schedule your free consultation today by clicking here.