LinkedIn has the highest lead-conversion rate than any other social media channel at 2.74% – compared to Twitter (0.69%) and Facebook (0.77%), that’s almost three times higher than two of the largest social media sites.
With over 500 million members and 94% of marketers using LinkedIn as their #1 content distribution channel, there is a lot of opportunity to utilize LinkedIn marketing to get your content in front of the people who’d enjoy or benefit from it most.
One way to do that is through LinkedIn ads.
What Can LinkedIn Advertising Do For My Business?
LinkedIn ads are created and managed through the LinkedIn Campaign Manager.
As a valuable part of a digital advertising strategy, LinkedIn ads allow you to increase content visibility to the business-minded users you’re targeting – and can prove to be extremely lucrative for your company.
By utilizing this type of advertising, your business can build successful relationships with new audiences, increase leads, and build brand awareness. There are many different campaigns and ad types you can run based on your advertising objectives.
But, what comes next might be the most important part: creating the budget for your campaigns. Sure, you don’t want to break the bank, but you also don’t want to low-ball your campaigns and risk not being seen by the right people
So, how exactly do you set the right budget for LinkedIn advertising? In this blog article, we tackle that very question head-on.
Setting Your Daily Budget
Your daily budget for LinkedIn ads is the max amount of money you’re willing to spend in a given day on your ad campaign, with the minimum budget being $10 a day.
Be warned that your actual daily spend could potentially be up to 20% higher.
According to LinkedIn, marketers should be aware that “there may be a short period of time after your budget is reached when your ads continue to display. You will be charged for clicks or impressions that are delivered during that time up to 20% beyond your daily budget.”
To get a better idea of what your daily budget should be, multiply your bid by the number of clicks or impressions you want to get per day.
If you wanted to receive 15 clicks per day but want to spend no more than $5 per click, you would want to set your minimum daily budget to $75 per day.
Setting Your Bid
When advertising on LinkedIn, you must choose either an automated bid or a maximum cost bid. According to LinkedIn, “Automated bidding utilizes machine learning to get the best performance for your budget, white maximum bidding ensures better cost control.”
Automated bidding charges by impression, whereas maximum cost bidding lets you define the max amount you want to pay per click, per 1000 impressions, or per video view.
If you do choose a maximum cost bid, LinkedIn will show you a recommended bid as well as a range of prices that other advertisers are bidding. These are based on advertisers targeting a similar audience.
LinkedIn recommends setting an automated bid to get the most for your budget; however, if you are looking to better control your budget, you might want to select a maximum cost bid.
Before blowing all your money on one LinkedIn campaign, you first want to find the types of ads and text language that speaks most to your audience to see which ads are going to give you the most bang for your buck.
To do this, your business should use A/B testing – by creating multiple variations of an ad, you can run them all at the same time to identify the top-performing ads. With the ad products available – Text Ads, Sponsored InMail, Dynamic Ads, and Sponsored Content – LinkedIn makes it easy to run A/B testing with multiple variations of an ad.
Once you create the different ads to test during the creation phase of your LinkedIn advertising efforts, your business should keep a close eye on important metrics of each ad to compare how successful each variation is.
Once you find the top-performing ad, do yourself – and your company's bank account – a favor and pause the ad variations that aren’t performing as well.
While A/B testing doesn’t directly relate to setting a budget for your LinkedIn advertising, it does ensure that you are spending your money in the right places.
Putting It All Together
Once you create your ad product, include the necessary information, and establish your budget and bid, your LinkedIn ad is ready to be published.
But, don't just set it and forget it: Constantly keep track of your ad performance. Keeping an eye on your current campaigns will allow you to see how your ads are engaging new audiences and bringing you new business.
And, with the right budget for your ad campaigns, your company won't be broke after your campaign is over.
Editor’s Note: This post was originally published in September 2015. It was updated in November 2018 for accuracy and comprehensiveness.
Baylor is an inbound specialist for Bluleadz. As a native Floridian, she enjoys soaking up the Florida sun, buying clothes she can’t afford, and dreaming about one day owning a dachshund.