Ep 111 - LinkedIn Ads Cheapest Ad Formats | Lowest Cost Way to Advertise on LinkedIn
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SHOW TRANSCRIPT
LinkedIn Ads are pricey. How do you advertise for less? We’re going through all the cheapest ways to advertise on LinkedIn on this week’s episode of the LinkedIn Ads Show.
Welcome to the LinkedIn Ads Show. Here’s your host, AJ Wilcox.
Hey there LinkedIn Ads fanatics. You know, LinkedIn Ads are expensive. There’s just no way around it. B2B marketers come to the platform for the incredible targeting. And then they’re constantly saying, Oh, I can’t believe how much I’m paying. Well, in this episode, we’re gonna go through all the lowest cost ways of accessing the platform’s targeting and features. So buckle up.
Alright, so I want to try something new. I would love to have you listeners record yourself asking a question, commenting on something from a past episode, or just basically giving feedback on the podcast, and then shoot that audio file to me either over LinkedIn in a message or by emailing us here at Podcast@Blinked.com. And then, rather than reading your reviews or questions that you want covered, I actually want to play them on the show. So let’s try this out. I don’t know how it’s gonna go, but I’d love to hear from you. Alright. Now on to the topic at hand. Let’s hit it.
First off, we need to talk about LinkedIn’s different ad formats for many advertisers. And this is those in North America, text ads are by far the cheapest ad format on LinkedIn. They have a $2 cost per click floor, which makes them the cheapest ad format for most of us, like I said. Outside of the US, we have found that $2 floor is actually more expensive than what they can get sponsored content for. But at least in North America, LinkedIn text ads are super cheap. The $2 floor means that you can pay all the way down to $2 per click if you’d like. They rarely get clicked anyway so it’s actually really hard to spend a large budget on them. So now you’re getting a lot of benefit of your ad showing up basically every time someone refreshes the page or navigates around on LinkedIn. So they’re constantly seeing your brand, but it costs you next to nothing. So I love this for impressions, for branding, for brand awareness.
The next one we have to talk about the ad format is called dynamic ads. Now they cost slightly more than text ads, because they get a slightly higher click through rate, the average click through rate is around .08%. So that’s roughly two to three times higher than text ads. So these are going to get more clicks, that’s for sure. And you’ll pay an average of about $5 to $8 per click. Which if you’re paying, let’s say $3 to $5, a click for text ads, these will be higher, for sure. But they also get about three times the attention. So it works out. Some of you are trying just to spend the least amount on LinkedIn as possible. Others are trying to get some semblance of volume. So dynamic ads are gonna give you a little bit more volume than text ads could, but of course, you do pay. Now, about a year ago, LinkedIn removed the bidding floor on sponsored content. It used to be a dynamic floor that would move based off of how competitive an audience would be. And so if you put in there your bid and said like $4, LinkedIn would show a bright red message that says the minimum bid for this audience is actually $5.75, or $6.15, or something like that. But just about a year ago, LinkedIn removed that floor. So now we can bid lower. The challenge is that we might be bidding too low to have LinkedIn even consider us in the auction. But at least we have the choice now, whereas we used to have to bid right at the floor. So as you bid lower in sponsored content, you might find that it doesn’t generate the impression volume that you need, but at least you have that ability. Now, if you ever launch an ad, that gets an incredibly high click through rate, let’s say like two or three or higher percent, what’s going to happen is, you’ll be able to bid significantly lower, and you’ll still win auctions in LinkedIn’s algorithm. So this is absolutely fantastic for you, advertisers, who get incredibly high click through rate. Removing the floor can make you pay half or probably even less than what you were paying before. I also do have to mention the LinkedIn Audience Network. Because LAN, as we call it, it is a very inexpensive way to run sponsored content ads on LinkedIn. What the LinkedIn Audience Network is doing is it’s getting traffic from all around the web, from other Microsoft properties, from apps, all kinds of different places. And because that inventory has a lower cost than LinkedIn’s own inventory on the platform, they’re able to charge you less. So we’ve been able to see cost per click from the audience network under 50 cents. I mean, you get it down to like 35 or 40 cents. Pretty cool. Now the downside is here that from all of the traffic analysis that we’ve been able to do on traffic that comes from the audience network, we just don’t see the quality signal, which is really unfortunate. But what we have seen is recently LinkedIn released on some I don’t know if this is on every account, we might be in a beta for this. But we have noticed that one of the types of columns that you can look at your traffic by is called MRC impression. And we looked it up. MRC is like a media ratings company that is auditing if there’s actually a real person on the other end of that app. So we looked specifically at a LinkedIn Audience Network campaign. And we saw something like 100,000 impressions reported from lamb. And then we broke that down by MRC impressions. And we noticed that there were about 25,000, a little bit less. So what that told us is, hey, we don’t actually know how much quality is coming from the audience network. But what we do know is, at least if you believe the MRC ratings, that probably about a quarter of that traffic are real people. So in my mind, if I’m paying a 10th, as much for LAN traffic, as I am for just my normal sponsored content on platform, then if you assume a quarter of those are real, you’re still net positive here. It could actually still be a good ad format for you, or a good way of advertising. But you will have to decide this for yourself, analyze the traffic you’re getting from the LinkedIn Audience Network, and see if they are exhibiting the quality signals. If they are the clicks that you want. Great, definitely use it, but definitely do be cautious. The next ad format I want to talk about is kind of an ad format. And it’s kind of not, these are called thought leader ads, we’ve talked about them before on the show, I’m eventually going to have a whole episode about thought leader ads. But the reason I bring them up is in theory, these are incredibly cheap compared to all the other ad formats. The reason why is because like we’ve talked about in the past, the higher the engagement rate that your ads get, the lower the cost is going to be. We’ve talked about that every time we’ve talked about the auction, and relevancy scores and all of that. So in theory, here, you have a company post on LinkedIn that very few people are going to be willing to interact with, because you never know if a post that has a company’s logo on it. Is there anyone paying attention? Are you just wasting your time by commenting on an ad? Well, now with thought leader ads, we are boosting an individual’s post. So most people are going to actually respond when people comment on their posts. So when you see a human face on one of those posts and you want to interact, you’re probably going to go ahead and do it. So what we’re going to see is these ads have a higher on average click through rate and engagement rate. And that means that these are going to perform better in the auction, you should be able to win more auctions at a lower cost meaning to you, you’re going to see it’s easier to get impressions on your ads, and your overall cost per click or cost per impression is going to drop. This is an absolute game changer, in my opinion. On the same token, boosted posts, and this means taking a post that has already been published on your company page, and then boosting that from your ad. Now you don’t have the same level of person ability through these as you would with thought leader ads. So of course, costs aren’t going to get as low as they could with thought leader ads. But boosting a post can end up with lower costs than if you’re just creating ads right within the platform. And starting out from scratch. The reason why is because it’s already going to have some social proof attached to these posts. Every time you look at an ad and it says zero reactions and zero comments, you kind of wonder like, Oh, does nobody care? Am I the only one to ever see this? Or is this company not really great? Or are they a fly by night organization, all these kinds of questions go through your head. And then more than often, you just kind of keep scrolling. But with a boosted post, you’re putting that post out to your company page followers. These are people who already have affinity and rapport with you. That means they’re going to interact at a higher rate. And they’re going to leave some comments and some reactions, hopefully. So now you go and boost these posts within your ad platform. And by the time someone sees this in their newsfeed, they see oh, there’s already 30 people who’ve interacted with this. There’s already six comments, and people are actually starting a conversation. That’s going to help people feel at ease in interacting with your posts. And you’re going to see higher engagement rates. Higher click through rates that are going to end up meaning more impressions for you more clicks at a lower cost.
9:44
Alright, next ad format we want to talk about is video view. Now if you’ve heard me talk about video before in the past, a year ago I was telling people oh the cost per click on video tends to be about 20% higher than the cost per click of single image ads. And that definitely is true. But I was using that as a yardstick to say how video performed compared to static. But when we’re running video ads, the cost per click is not usually what it is that we’re actually looking to optimize for. Now, here’s an example from our own campaigns. One I’m thinking of specifically, we were running static content and our average cost per click was something like $11. Okay, fine, might be a little bit high might seem low to some of you. But that’s about what it was. We started running video, and we’re talking about a one minute video here where after watching it, you’re going to make an emotional connection with us as a company. You’re going to know like, and start to trust us a lot more. And what we were finding is our cost per 50% view, which is the metric that we really liked to measure was less than $5. So if we’re thinking about it like this, if we’re going to send traffic to a landing page, or our website, and it’s costing $11 per click, or we’re paying less than $5, so less than half to get people to watch half of this video, that sure is actually feeling like a much, much better deal to us. So I’m really bullish right now on video ads on LinkedIn. And so that’s why I put it in this category of being cheaper, because as long as you have high performing video creative, this could work really well and get you costs that are so much better at making an emotional connection than just sending them to like a page on your website.
And I think I have to mention something about retargeting and warm audiences here in the cheaper side of LinkedIn. Because we know that when someone has interacted with you before, they’re now so much more likely to interact with your content again. Again, they feel like they know like and maybe even trust you at this point. So when we run cold audiences, we expect click through rates that look like cold audiences, they’re lower. And then anytime that we run a retargeting audience, we automatically expect that click through rate to be significantly higher. We know warm audiences interact at a higher rate. And so because of that costs are lower, which is also great. But then you may be asking yourself, AJ, what about these small audiences on LinkedIn? They tend to have higher costs associated with them and retargeting audiences tend to be smaller audiences, I totally get you there, there is a balance. So when you’re retargeting, let’s say that you have an audience of 300 people. You may find that you have to bid $15, $20, $25 a click in order to get any traffic from those retargeting audiences. And that’s rough. But there is a balance, because if those audiences are truly warm, then they’re going to click at a much higher rate, bringing your costs down. So what we initially recommend is if you have very small retargeting audiences, combine them together. You might have a retargeting audience of anyone who’s visited your company page cool have that you might have website visitors cool. Add that together, maybe you have a list of past customers that you want to stay in front of, or maybe even current customers who knows they’re probably going to interact at a higher rate. But what you do is you take all of these retargeting audiences, add them into one campaign, and now that one campaign has enough people in it, and enough people who are active that the click through rate on them should be high, meaning that you don’t have to pay $20, $25 a click for that.
Alright, here’s a quick sponsor break. And then we’re going to dive into the areas of LinkedIn that will cost you more, you’re definitely not going to want to miss that.
13:38
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Alright, let’s jump into the areas of LinkedIn that are going to cost you more that you may want to avoid. The first one you’ve probably heard me talk in the past about sponsored messaging. There were two formats for sponsored messaging. There are currently, but one’s going to be going away and then one’s going to be changing significantly. But with sponsored messaging, we paid per person that we sent a message to and it was usually like 50 cents to $1. So it was pretty expensive. But then only about half the people who received these ads, I would open them and then on average, about 3.2% of people would click them. So when you actually do the math, you are up at like $25 to $55 per click from sponsored messages. So for the longest time, we said, oh, you need a really special VIP kind of offer to make these worthwhile, because then more people would open them and click on them. But we also said that these are mostly useful for retargeting for these audiences who already know like and trust you, and then they’re going to actually open and click at a much higher rate. So my caveat here is, this is about to change. Message Ads are all but gone. LinkedIn, as of the time of recording, they’re still showing some of these ads, but they’re going to cut off soon. And you can’t create any new ones. So we can say bye bye to message ads, pretty much. But then we have conversation ads. Conversation ads are very much the same kind of thing, but you offer more options for someone to interact. So you send a message, and then you can have kind of a chatbot experience of like, Do you want a white paper here? Do you want to talk to someone? Do you want to tell us goodbye, and you never want to hear from us ever again? All of that kind of thing. But the interesting thing with conversation ads, they’re still around right now, you can still use them. But in the future, they’re going to be migrated into a sponsored content kind of ad. So it’s going to show up in your newsfeed, which means the cost per click is going to be significantly lower. You’re only going to have people click who are ready for this. And then once they interact, then it takes them to the message box where they’ll get to have that chat bot experience. So right now conversation ads still don’t make a ton of sense. I think they’re incredibly expensive. But they are going to improve significantly when they become part of the newsfeed. And we can bid, you know, $8 to $12 per click on them.
The next ad format that we should talk about here is carousel ads. Of all the times that we’ve tested carousel ads, I’ve only ever seen one case where the engagement level on a carousel ad was higher than that of a single image sponsored content ad. What we find is carousel ads are more work to create. It’s like you have to create four or five single image ads just to create one carousel ad. And then you don’t really see the payoff from having higher engagement rates. And so because of that, you see higher costs. So we don’t love carousel ads. In most cases, we see they don’t work. But obviously, if you have any experience with carousel ads, that you are an absolute fan, please reach out, I’d love to take a look at your use case here.
Now we talked about in the video ads category, how video can be very efficient. But I want to mention that if you’re using video, and you’re trying to get a low cost per click to a landing page or to your website, video ads on LinkedIn are going to be more expensive for that. So if your goal is to get a low cost per someone watching your video than the video views objective on LinkedIn is going to be great for that. But if you’re trying to use video again, to just get lower costs, you’re probably going to get lower costs from single image ads. So probably stick.
I should mention event ads. A couple of weeks ago, when I spoke at Inbound, I did have someone raise their hand and say that they’re having extreme success with their event ads. And I love that. I love hearing when you guys have a great success for something that I tend to not be very bullish about. But in general, I would say the events on LinkedIn are pretty limiting. Most people who are running events like they’re running them on something like in Eventbrite and outside platform. And so having LinkedIn have its own event, and then you’re running ads that just promote that one event, we find that those don’t tend to perform as well as if you just had, let’s say, a single image ad that was pointing to something like Eventbrite. And I think we have to mention here single image sponsored content, not because it’s necessarily very expensive. This is just the benchmark that we measured everything by. So when I was putting things in the category of like, these are ad formats and objectives that are less expensive and here’s those that are more. Everything that went into the less expensive bucket is just because it was less expensive than single image sponsored content. So because it’s the benchmark the average that we measured everything by, we ended up putting it in this expensive category. Alright, I’ve got the episode resources for you coming right up. So stick around.
19:23
Thank you for listening to the LinkedIn Ads Show. Hungry for more? AJ Wilcox, take it away.
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