Maybe you’re thinking about advertising on LinkedIn, but you’re not sure it’ll be worth the cost. Or you may already be doing LinkedIn ads but aren’t sure you’re getting enough return on the investment. Or perhaps you know your LinkedIn ads are profitable but are looking for ways to get your costs down.
What you need is a clear picture of the LinkedIn advertising process, an analysis of the cost, and a strategy to ensure you get the most out of your ads. This video will cover all three facets—process, cost, and strategy—to better equip you to make decisions that will lead to more profitable advertising on the internet’s primary B2B social network.
I had a conversation with a gentleman who sells really big B2B projects. His deal size is easily in the six figures, often in the seven figures. By definition, this is a complex sale. This is the kind of sale that involves multiple influencers, multiple decision makers. It takes some time to close the sale. So these are really big, complex deals.
Now, he was thinking about how to use LinkedIn as a way of generating more leads and closing more business. The typical route he would normally go is to hire a sales team, train them, and send them out into the field and do that thing. But he was looking for a more modern way, and perhaps a faster way, of attracting new business.
So we were having this dialogue, and I'm offering you a summary here. Because if you're new to advertising and you're new to advertising on LinkedIn, there's a way you should be thinking so that you can keep your costs down. You can keep your costs under control.
We're going to lay out the process here and layer in the thinking, so you can see where the cost may balloon on you and just make it a bad deal all the way around.
LinkedIn Ads: Exploring the Best Practices
The first thing we want to look at is the actual process. Some may call this a sales funnel. We want to think about this left to right, so we’ll think about this in terms of “LinkedIn ads come first.”
- We're going to make some ads.
- We're going to run those ads to a registration page where people are going to opt in for something.
- Once they register, there'll be some sort of video explaining the opportunity and offering a booking link.
- When they click the link, we want to get them on the calendar.
- Once they're on the calendar, we'll have a conversation with them.
- And then eventually they'll become a closed sale.
Now we know that in this process, the chance that someone's going to become a closed sale from one conversation is not practical. So we know there's some timing that's going to happen here, and our process needs to reflect that timing.
What Should My Ads Do?
Let’s continue, and you’ll see what I’m describing. What are we actually trying to do here?
- Identify decision makers. On LinkedIn, we're going to target one specific person on the LinkedIn platform. We're trying to identify one particular decision maker.
- Introduce opportunities. When we put that ad in front of them, we want to introduce them to this opportunity. There's a chance for them to make some money, save some time, remove a specific discomfort that they're experiencing, or accomplish a significant goal that matters to them. This is the “selfish” part. This is what would motivate someone to move forward in this process.
- Establish criteria. We also want to introduce the fact that they have to meet a certain criteria. The person that lands on this page has to be a decision maker or at least an influencer. They have to be at a certain level in the organization in order for the completion of the form to make sense. They need to have a company of a certain size or type, and they need to be in a certain market.
So there's a basic profile they have to meet in order for this page or the coming content to be valuable to them. It's important that we establish that criteria up front.
- Engage prospective clients. The next step here is that they'll go to a video that will explain the opportunity. “Hey, here's, what's possible. Here's what can happen here. If you want this thing, if you're trying to avoid these issues, check that you meet this criteria, and you can move forward.”
- Gather data. There's a possibility here that when they book time, they can also give you some additional information. They can give you their name and their company's name, their company's size, the issues that they're currently experiencing. So you can have some data about whether or not they fit the core criteria.
- Open doors. This opens up the door for a conversation. The two of you are going to talk, and in that conversation, you can figure out:
- Do you qualify? Does your organization meet the appropriate standards?
- Do you have an issue that's worth being resolved? (because this is a very expensive thing).
- Do we have enough urgency, enough desire here to move forward in the process?
- If so, then what is the next step?
And then you begin to move down the steps of the complex sale and eventually they will close a sale and become a client.
Why Am I Advertising?
So that's what we're doing, the actions that we're taking. But why? Why are we taking these actions?
- To get leads. We know that LinkedIn is the premier B2B social network. We know that many professionals have a LinkedIn profile, and LinkedIn gives us access to the audience. That's kind of self-explanatory. This process gives us inbound leads. Now people are coming to us; they're coming to you. And they're raising their hands and saying, “Yes, I want more information. I want to interact with someone about this thing.”
- To qualify and disqualify. We're also creating a space for disqualification, because certain people don't fit the criteria. And that's not a matter of personal judgment; it's just being honest. This only works if you're in this situation; we can only be valuable to you if you're in the situation. This opportunity only makes sense for you if you're in a certain situation. So it's important to set some disqualifying factors right up front.
- To assess. Why do we have the conversation? We're not having the conversation to sell anything immediately. There are too many steps involved. Instead, what we're trying to do here is just assess fit. We want to confirm: Are you the right person? Is your company in the right situation? Do we have what we need to move forward? And then if so, we do it.
Though it seems so simple, it's important to understand why each of these steps is mandatory to having success and keeping the cost down. That’s what we’re doing with this kind of a funnel, this kind of sales process.
LinkedIn Ads: Examining the Costs
Let's look at the actual costs here. LinkedIn is on the premium side of online advertising—it's expensive to advertise on LinkedIn. So if you're new to this, you’ve got to see what these numbers look like and not panic.
What Am I Going to Spend?
- Let's assume that you're paying $10 per click on LinkedIn, and let's assume that you're going to drive a thousand clicks. So it's going to cost $10,000 to get your first bit of data from this campaign. All right? $10,000 is now spent.
- Let's assume that 20% of the people who land on that registration page actually register. So then you're going to get 200 leads. At the moment it's costing you $50 per lead. That's what it has cost you to get someone to register and see the video and the link application.
- Now let's assume that 20% of the people who register choose to schedule. That is 40 conversations now that have been booked on your calendar. 40 conversations. So you've paid $250 per conversation.
- So you have these conversations, and let's assume that 2.5 percent of the people you speak to end up becoming a closed sale. That's one out of the 40.
- That's one closed sale as a result of this entire process. That means it costs your company $10,000 to close a sale.
Now we've got to see these numbers for what they are. Because again, if you're new to advertising and if you're new to LinkedIn, this may seem expensive. And on one hand, it is. But remember, if you're closing deals that are six and seven figures, well, there's a cost to acquiring a client.
And if the deal is six figures large, $10,000 pales in comparison. This is something that you actually would want to set up. You’ve got to see this as a cost of doing business. It has to make sense to you.
What Questions Should I Be Asking?
Now let's look at some things to watch out for:
- Can you get the cost down? That's always the question we're going to ask: can you make it cheaper? Yes, you can. You can get the cost down, but the costs lower with time and with strategy. It takes some time to get this set up. Just setting it up does not mean everything’s going to flow the way you want it to the very first time. It takes some iterations to get this thing tweaked and appropriately optimized. You’ve got to build in some time for that.
- Can you strategize? You’ve also got to build in some strategy. There's some thoughtfulness that you're going to have to apply in order for this to make sense. Again, it won't just work out of the box immediately. We’ve got to apply some pragmatism.
- Can you simplify? It's really important that the pages you set up—the registration page, the landing page, the thank you page after someone registers—these pages need to be simple. It's really easy to overcomplicate the page, overcomplicate the messaging, overcomplicate the design. We forget how confusing all those details become to the person who's just trying to understand the opportunity and speak to somebody. So keep the pages and their outline as simple as you possibly can.
- Can you manage your calendar? The prospect, this person who wants to talk to you, is going to set time on your calendar. So you need to manage your calendar effectively. You can set some boundaries on when people can and can’t book time. And then you're always available when someone books time, because you set those boundaries. There are some tools you could use, some scheduling software that you could use to manage your calendar. Great.
- Can you think through the sales process? On this call, you do the selling. You're the expert, so you're going to do the selling. You're going to talk on the phone, but the process needs insight. So it's not just: Did they buy? Yes. Did they buy? No. There's a way you’ve got to think about the conversations you have so you can continue to improve this entire process.
- Can you make it worthwhile? Looking at that cost per closed client, do you have the patience to get here? Because if you're advertising on LinkedIn for the very first time, even if you've done advertising some other place, there's always going to be a learning curve when you begin to execute on the platform. Do you have the patience to get to this closed sale number? Whatever it costs you to close the sale? Because if you don't have the patience, then don't start, don't bother. Save your money; use it for something else.
- Can you compare costs? An important comparison point here: is this more or less expensive than hiring a salesperson? The person I was talking to at the moment didn't have a sales team. So he was going to have to find people, hire them, train them, salary them, offer bonuses and commission. If you think about all of the costs associated with doing that and you compare it to the cost of doing this, what makes sense? That choice is yours, clearly.
These are the checkpoints that I think are appropriate when you think about running a system like this one.
What Are My Actual LinkedIn Advertising Costs?
Now a quick sanity check here, because if you've been doing your research about online advertising, you've seen advertisers boast at getting per-click numbers much cheaper than $10 per click. And so you may have gotten mentally stuck right here thinking, “Come on, Alzay. Can't you get it cheaper than that? That sounds outrageous.” So let's use some empirical data, shall we? Research has already been done on this.
On LinkedIn, the average cost per click is $5.26. So this is the average, meaning some folks pay a whole lot more and some folks pay a whole lot less. And if you're new to this, you're probably not going to start at the whole lot less. You're going to have to get better as you go.
Here's some of my own data. You can see my own cost-per-click here. Yes, sometimes I pay $2.82. Sometimes I pay $17.04, or somewhere in the middle. The reality here is that you're going to pay a premium, but if your strategy is sound, then you can work those costs down.
LinkedIn Ads: Four Keys to More Effective Campaigns
Back to the outline. You've seen the process. You have a general idea of what the cost of execution looks like. But now let me share with you four specific things that are rarely talked about but are mandatory in order to keep this process profitable for you.
- Target one type of person at a time. Now you may know this as a client avatar or a buyer persona or a target client. (Everybody says they have one of these things, but most don't use it. You say, “Where is it?” No one ever knows where it is.) You need this client avatar to be focused and sharp, and you need one of them at a time.
One of the classic mistakes we make when we begin to execute digital advertising is to make 15 different targets at once, thinking we're going to figure out which one sticks or which one works. That approach splits your momentum 15 different ways. It splits your budget 15 different ways.
A more appropriate straightforward, efficient approach is to focus on one particular type of person. What you're trying to do is get a bullseye effect happening, so you realize who belongs right here in the center. If you create different iterations of that person, then that makes sense. But what you're after is one target profile.
Get good at resonating with that profile. Prove to yourself that you can get that person on the phone; prove that the system works. Then you can begin to expand out into other iterations, other types of decision-makers, other types of companies. Keep your focus on one person at a time.
- Create a feedback loop. As you work through this process, you get data, and that data must be used to refine the avatar. Are we getting the person that we thought we were going to get? If we are, great—double down on what we're doing. If we're not, then we have to make incremental changes with this process.
Maybe we've learned in this process that the ad copy needs to change. Maybe what we put on the registration page needs to change. Or the video content needs to change, or what we say to prepare someone for the conversation needs to change, or how we're dialoguing on the phone needs to change.
Any of these changes can make incremental movement in the numbers, which again can multiply the positive effect that you have. It can multiply your ROI by making these ads fundamentally cheaper, but you have to value this feedback loop. Oftentimes we make the mistake of making these micro changes by looking into the dashboard itself and trying to use those numbers to tweak what to say in the ads. Or we move the headline three inches to the left or to the right, or we change this image or picture.
Yes, those things have some value, but the number one thing you can do to maintain the integrity of this feedback loop is to listen to what people are saying when you talk to them on the phone. What happens in this conversation is the most valuable feedback you need to maintain this integrity. You can't do it with just data from the tool alone. It's got to be married with—in fact, led by—the information you're getting from live conversations with human beings.
- Optimize this process for the sale. The reason that you’ve built this process is to make more sales. Therefore, optimize the process to communicate to the kinds of people who buy what you sell.
The mistake that we make is we'll optimize this for things that are comfortable to us. We'll optimize for clicks. We'll optimize for leads. We'll optimize for booked calls. Each of those data points do have some value, absolutely. But at the end of the day, what you're after is for someone to make a purchase.
So as you think about designing this, each thing should be inviting people who buy this kind of thing and repelling people who don't buy this kind of thing. You've got to be courageous enough to build the kind of system that will push people away if they're not the right fit for what you offer.
- Scrap what isn’t working. You have to have the courage to scrap this avatar if it's not working. You make your hypothesis, you build an avatar, you run the campaign, you get some feedback loop, and you may find that the person that you thought you were targeting is very much somebody else.
If it is someone else, then you've got to change not only this avatar but the entire funnel. You need this avatar to lead the funnel. But that also requires some courage, because you may have to admit that you were wrong. You may have to admit that what you set up here is just flat-out the wrong thing. And you've got to have the humility and courage to scrap it if necessary and redesign appropriately.
If you sell really big consulting projects, six and seven-figure deals that are complex sales with multiple stakeholders, the typical thing to do is to hire a sales team and to put that team in the field and let them deal with that complexity. But if you've been looking at or considering a more modern approach, a more advertising-based approach, a more content-based approach, it's going to end up looking something like this.
It's important to remember, though, that the machines can't do all the work for you. There is some leverage you can get from having the machines, from having the internet give you leverage in this process, but there is some thoughtfulness required on your end to make the system work on your behalf.
Because at the end of the day, the system is functioning as an automated sales person. And so the same way you got to train a human salesperson, you’ve got to train a digital salesperson. If you want the sale, if you want the scale, you have to put in the work.