What the Hell is Going On with LinkedIn Ads?
As a fractional CMO, I’ve used LinkedIn ads for my B2B clients for several years. In the past, I found them to be affordable and effective, either for brand building or direct response. But lately they have become outrageously, unaffordably expensive.
Typically, my B2B clients are either startups or SMBs, and for both strategic and financial reasons they’re narrowly targeting their marketing by industry, title, company size, geography, and a few other factors. Sometimes we use LinkedIn’s audience filters, and sometimes we’re using a custom list that we upload and LinkedIn matches. In either case, the target audience is usually less than 10,000 people. Yes, LinkedIn always warns us that we need at least 50,000 people for optimal results, but there aren’t that many people in my client’s target companies, and I haven’t found that having targets of less than 10,000 people has hurt results in the past.
I could get good results spending about $50/day on these campaigns, because that’s all it takes to reach several thousand people repeatedly when you’re getting CPMs around $15–20 .
Here are the metrics from a campaign several months ago.
That’s a very good, $14 CPM. And LinkedIn offers an effective, business context and when people click, share, like, or comment, other prospects are likely to see our ad, too. All’s good.
But about three months ago, that CPM and CPC shot way up. WAY up.
Here are the metrics from a more recent campaign.
Paying $113 for 364 impressions translates into a CPM of $309! That’s outrageous, and the CPC is more than 4X higher than before.
So I turned off that campaign after just two or three days. I’m not going to have my client pay that, that’s highway robbery (or high-tech robbery).
Here are the Facebook results for three days, using the same custom list and creative.
That’s a CPM of about $15, similar to the old LinkedIn, and a CPC of $2.28. So I continue to run this Facebook campaign.
I’ve seen this outrageous CPM with LinkedIn campaigns several times in the past couple months, to the point that I don’t use LinkedIn ads anymore. I’d like to, but not for that kind of money.
I’ve tried to reach people at LinkedIn to find out what is going on, usually I don’t hear back. If I do, I am told that we shouldn’t be spending $50/day, we need to spend $150/day (tried that, nothing changed). Or “you need to let the campaigns run longer so the algorithm can learn what works.” Not on my client’s dime, I don’t. Not when it’s a small, custom list and the algorithm doesn’t need to learn anything, it just needs to run the ads. Not when Facebook’s algorithm doesn’t need time to learn.
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Update: Through most testing, I’ve come to realize that the ultra-high CPM rate occur with campaigns running only on LinkedIn, and that if I use the LI Audience Network I get much more reasonable rates. But I have no idea how many of the impressions are on LI and how many on the network, and what sites.
I was watching a LI panel on marketing measurements and sent in that question. I got this reply: “While the LinkedIn Audience Network was created to address issues of high CPMs on the platform, there is an inherent tradeoff in how much reporting detail you get. This is something we are planning to address in CY24 by introducing things like publisher-level reporting where you will be able to see where your activity ran.”
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How does my Bullseye Marketing Framework compare to that in Gabriel Weinberg and Justin Mares’ Traction? Here’s my analysis.
