LinkedIn is widely known as THE social network for professionals, boasting over 260 million monthly active users worldwide (≈1/4 of which are in the USA). This huge user base makes LinkedIn seem like a natural fit for B2B advertisers looking to target professionals. However, there is one key factor about LinkedIn Ads which makes marketers hesitant to test the platform: the high CPCs. Compared to other main social advertising platforms online (Facebook Ads, Instagram Ads, Twitter Ads, etc.) – it is not uncommon to see CPCs up to 5X-10X higher on LinkedIn!
On the surface, it’s clear why these higher CPCs alone could scare away some advertisers, or at the very least question if those higher CPCs are worth it. With our experience running LinkedIn Ad campaigns across a wide variety of industries for our B2B clients, we can confidently say that yes, they can definitely be very effective for the right advertisers! Generally speaking, if you’re a B2B company and your average closed deal is worth $10K+, there’s a very good chance that LinkedIn Ads could be a powerful lead generation tool for you. There are three key reasons why we’re such big fans of the ad platform: the nature of LinkedIn, targeting capabilities, and ad formats.
Nature Of LinkedIn
While other major social media platforms such as Facebook, Instagram, Twitter, and Snapchat are used primarily for personal reasons by users, users spend time on LinkedIn for very different reasons. Many user behavior surveys indicate that the top reasons for spending time on LinkedIn include professional networking, company research, industry news, job opportunities, and other professional activities. This leads to users that are much more receptive to advertisements geared towards their work life, which is reflected in the high conversion rates that we often see from LinkedIn campaigns.
When creating a LinkedIn profile, LinkedIn users input a significant amount of data including current (and past) employers, job titles, educational background, professional skills, and more. This allows LinkedIn Advertisers to get very granular in the ways they can reach their target market:
The key to taking your targeting strategies to the next level is to layer targeting methods as much as possible to get more granular. For example, let’s say you offer software for accounting professionals in smaller accounting firms. Instead of solely targeting users with the Accountant job title (≈720K users in the USA), narrow down those users to only accountants in the accounting industry (to ensure you are not targeting accountants within unrelated industries), which would narrow down your potential audience size by 67%. Then you can use company size targeting to reach only accountants in smaller firms (<200 employees), which narrows down the audience size again by over 70%. Now, instead of paying to reach a somewhat relevant audience of 720K, you are layering targeting so that you’re only paying to reach the most relevant 66K of them.
LinkedIn has been continually expanding their range of ad formats in recent years, and now offers Sponsored Content Ads, Text Ads, Sponsored InMail (Message) ads, and Spotlight ads. While all of these ad formats can be effective in different situations, we have specifically seen amazing results with Lead Gen Form Ads, which is a variation of the traditional Sponsored Content ads that appear in a user’s feed on desktop and mobile. While traditional LinkedIn Ads were designed to drive traffic to a landing page to complete certain actions (asset downloads, form fills, etc.), lead gen forms allow users to submit their contact information to a company without ever leaving the LinkedIn platform:
As demonstrated in this example, a user’s information is pre-populated by LinkedIn in a form after someone clicks on the initial ad, resulting in a seamless process that in our experience has consistently generated conversion rates up to 4X higher than similar campaigns driving traffic to landing pages! Ads can be used to promote certain marketing assets (case studies, whitepapers, ebooks, etc.), or for lower-funnel initiatives such as scheduling a demo or requesting a quote. Pro Tip: The “Work Email” field is the field we ask for in almost all of our lead gen campaigns, and we’ve noticed that even when requesting this field, personal email addresses are often submitted, simply because their work email is not listed in their LinkedIn account. A workaround to this issue is creating a custom question for a work email, which forces the user to type out their work email as opposed to having their personal email pre-populate. Advertisers can then either download a CSV of lead information from the LinkedIn Ad Platform, or they can integrate their lead forms with popular marketing automation/CRM platforms such as HubSpot for leads to be synced automatically.
Making The Most Of High CPCs
To summarize, high CPCs on LinkedIn can be easy to justify for advertisers if they are able to effectively target the right professionals with ad formats that maximize conversion rates. While it may take a larger initial budget to gather significant learnings and determine scalability than other platforms – we highly recommend LinkedIn Advertising to B2B brands that have high-value customers.