Smart budget and bid strategies are fundamental to the success of LinkedIn advertising campaigns. We know that! But get it wrong and you may as well pour money down the drain.
For marketing agencies and advertisers, it can be incredibly challenging to run multiple ad campaigns and keep track of budgets and bids. This blog post shares essential techniques for effective budgeting and bidding strategies in LinkedIn Ads. We’ll give insights into CPC and CPM bidding and share how to optimize bids for maximum performance.
Fundamentals of LinkedIn Ads Budgeting
Understanding LinkedIn’s Ad Budgeting Options
When configuring ad campaigns, you have a few budgeting options to choose from:
- Campaign Group Budget: This lets you set a budget at the campaign group level. Once the budget is spent, all campaigns within the group will pause.
- Daily Budget: Tell LinkedIn how much you want to spend each day and it will generally stick to that. However, it’s worth noting that LinkedIn sometimes exceeds the budget by up to 50%. Keep in mind too that LinkedIn requires a minimum daily spend of $10.
- Lifetime Budget: Set a budget for the entire duration of the campaign and let LinkedIn pace spending.
- Combination of Lifetime and Daily Budgets: Set both a lifetime and daily budget to control the pace and overall spend of your campaign.
Setting Realistic Budgets for Your Campaigns
Every ad campaign needs clear objectives.
Are you aiming to boost brand awareness, engage more users, or drive website traffic? Maybe you’re focused on lead generation and conversions because your audience already knows you.
Whatever you’re trying to achieve, you need to set realistic budgets based on campaign goals. Too little budget can limit your campaign’s reach and performance. Conversely, going overboard can lead to overspending and poor results. So getting the balance right is key!
If you’ve run LinkedIn Ads before, your past data can guide budget decisions. Factors like potential ad spend, average CPC, and conversion rates are a good place to start. We find most people lean on the budget estimations in-platform. Although only estimations, they give you an idea of what spend is possible given the size of your audience.
Bidding Strategies for LinkedIn Ads
Overview of Bidding Options: CPC, CPM, and Cost-Cap
Choosing the right bidding option on LinkedIn can be tricky! Do you want to pay per click, per thousand impressions, or set a cost cap per result? Let’s break down what it really means to help you decide!
Maximizing Reach with CPM Bidding
CPM bidding means bidding per 1000 impressions. It’s ideal for boosting brand awareness and reach. Simply choose the Maximum Delivery bidding strategy to automate your bids and LinkedIn will happily spend your budget!
Driving Actions with Cost Cap Bidding
With cost cap bidding, you can set a maximum cost per key result. This is perfect if the cost per result matters more to you than the overall budget.
CPC Bidding for Targeted Engagement
For optimal ROI, we like CPC bidding. You decide how much you’re willing to pay for each click. Manual bidding offers more control and typically lower CPCs, but it requires familiarity with the platform and time for monitoring.
Choosing the Right Bidding Strategy
So with all these options, what is the right bidding strategy? Well, you guessed it – it all comes down to your campaign goals and the time you have each week to monitor performance.
- Need maximum reach and awareness? Have limited time to check in on ads? Maximum Delivery is an easy option.
- For lead generation and conversions, manual bidding gives you full control over cost per click. By keeping a close eye on your data, you can adjust your bid accordingly.
- Some things to look out for include:
- CPCs lower than your bid – consider lowering the bid.
- Daily spend not spending – time to increase the bid.
Optimizing Your Ad Spend on LinkedIn
Strategic Allocation Across Multiple Campaigns
If you have a clear understanding of your customer journey, that’s fantastic! It allows you to distribute your ad budget effectively across each stage.
It’s understandable that organisations want leads! But neglecting top and middle funnel stages means missing out on the opportunity to engage and build trust with your audience before they convert.
A common challenge is how to divide the budget between top, middle, and bottom-of-funnel. While it varies, a common split is 70:30, with 70% for lead generation and conversions, and 30% for brand awareness. This is a good starting point for most but it’s certainly not a hard and fast rule! It really depends on your specific objectives.
Utilizing LinkedIn’s Audience Network
Ah, the LinkedIn Audience Network – or LAN. We hear mixed messages on using the LAN.
Extending your reach beyond the LinkedIn feed sounds good in theory – so think third-party sites and apps. If you’re happy with that, fine. While the LAN can certainly help increase reach, it’s questionable as to how relevant that reach is. If you’re looking for maximum control over who sees your ads and how your budget is spent, we suggest turning off the LAN.
Seasonal and Industry-Specific Budgeting Considerations
You’re familiar with the ebb and flow of sales and marketing, right? Well, it’s no different with LinkedIn ads. We notice a distinct shift in performance, particularly around public holidays, where performance tends to dip. And this isn’t always a bad thing – despite seeing low impressions, there are instances where leads still trickle in at a lower cost.
It usually makes sense to adjust your ad spend based on seasonality but it really depends on your business or industry sector. Read industry-specific reports, speak with your network and find out what works best for your organisation through the year.
Leveraging Analytics for Budget Optimization
Campaign Manager is probably the first place you go to monitor the success of your ad campaigns – metrics such as CTR, CPM, CPC, and CPL will give you an idea of how your ads are performing.
A CTR of 0.4% – 0.8% is optimal. Anything above and you’re doing great!
If you’re getting less than 0.4%, consider;
- pausing the campaign and moving the budget to one that’s performing well.
- if the campaign is critical to the business, reduce the budget while you re-evaluate targeting criteria, creative, and overall messaging.
Advanced Techniques in LinkedIn Ads Bidding
Utilizing LinkedIn’s Bid Adjustments and Automated Bidding
Automated bidding (Maximum Delivery) lets LinkedIn adjust your bids automatically. The upside? It saves you time and effort, but the downside means less control – which means you’ll likely pay more per click.
You’ve probably read conflicting advice about whether to use Maximum Delivery or not…it can be useful in a few scenarios:
- If your objective is brand awareness and reach.
- If you’re new to Campaign Manager and have no historical data to base decisions on.
Monitoring and Adjusting Bids for Ongoing Optimization
You can’t just set and forget an ad campaign. Once live, you should continually monitor performance and adjust bids as required.
Firstly, is the campaign fully spending? If your daily budget is $20, are you spending that, give or take? If not, you’re likely not bidding high enough, or your audience simply isn’t big enough to get initial reach.
If the campaign is spending and you’re seeing CPCs at or above the bid you’ve set, let the campaign run longer and monitor. If your spending and the average CPC is lower than what you set as the bid, you know you can get clicks for less.
Leveraging Dayparting for Optimized Bidding
Does scheduling ads work? In our experience, absolutely. And the numbers speak for themselves.
Unfortunately, Campaign Manager doesn’t offer ad scheduling or dayparting. Yep, frustrating! And it means manually pausing and reactivating campaigns. Hint – Linklo.io makes it super simple to schedule ads at the optimal time!
Measuring ROI and Adjusting Budget Strategies
Tracking and Measuring Campaign ROI
Metrics matter.
And measuring and understanding the ROI of your ad campaigns is crucial if you want to justify spending budget on future campaigns.
Campaign Manager gives you real-time data on your ROI metrics:
- CPM
- CPC
- CPL
- Conversion rate
- Actual leads generated
- Ad spend
- Campaign spend
To go even further with measuring ROI, get the Insight Tag installed and set up conversion tracking ASAP. This means you can get a full picture of how your ads are driving business.
Adjusting Budget Strategies Based on Performance Data
If you want to take your ads campaigns from meh to yeah, you’ve got to look at the performance data. Only then will you know how best to reallocate your budget to optimize spend. If a campaign isn’t performing, can the budget be moved to another? If a campaign is outperforming everything else, can additional budget be assigned?
Experiment with different budget allocations to find the best balance and don’t forget to use data-driven insights to guide your adjustments.
Conclusion
Getting your budgeting and bidding strategies right is essential for campaign success. In today’s crowded market, it’s not enough to set and forget an ad campaign. Now armed with actionable tips, you’re already ahead of the game compared to many other agencies and advertisers!
FAQs: LinkedIn Ads Budgeting and Bidding
First ask, what do you want to achieve? What are your goals? Who’s your target audience? Start by answering these questions to get an indication of the budget you’ll need to run a campaign. LinkedIn’s forecasting tool will give you an indication of potential daily spend based on audience size.
With CPC bidding you’re paying for clicks, while CPM bidding charges for impressions. Each has pros and cons, and your strategy will depend on your campaign objectives and performance.
Setting budgets too low, neglecting to monitor performance regularly, and failing to adjust budgets based on campaign results are pitfalls we regularly see when working with clients.
Audience targeting influences budget and bidding by impacting audience reach and competition levels. If your audience is too large, your budget will be spent but not necessarily on the right people. Too small and you may fail to spend.
Often! Ideally on a weekly or bi-weekly basis, to ensure alignment with campaign goals and performance metrics. You can then adapt strategies based on what’s working and what’s not.
First ask, what do you want to achieve? What are your goals? Who’s your target audience? Start by answering these questions to get an indication of the budget you’ll need to run a campaign. LinkedIn’s forecasting tool will give you an indication of potential daily spend based on audience size.
