Determining the right budget for LinkedIn ads in the UK can be tricky. The amount you should spend depends on various factors like your business goals, target audience, and more. Here are some tips to help decide an optimal budget for your LinkedIn ad campaigns in the UK.
What are the factors that determine LinkedIn ad spend?
Some key factors that influence how much you should spend on LinkedIn ads in the UK include:
- Your business goals and objectives – Are you focused on leads, traffic, or conversions? Do you want to increase brand awareness? Your goals help decide budget.
- Target audience – B2B audiences need bigger budgets. Niche audiences need lower budgets.
- Industry benchmarks – Spend will vary across industries. Know what others in your niche spend.
- Campaign type – Sponsored content needs higher budgets than text ads.
- Ad competition – Highly competitive keywords need bigger budgets.
- Location targeting – Targeting wider locations needs more budget.
Along with these factors, your historical ad spend and performance can guide your budget. If previous campaigns performed well on certain budgets, use those benchmarks.
What is the average LinkedIn ad spend in the UK?
According to LinkedIn, the average cost per click (CPC) for ads in the UK is £5.10. The average click-through rate (CTR) is 0.9%.
This means for every 100 impressions, your ads get 0.9 clicks on average. To get 1,000 clicks at the average CPC, you would have to spend £5,100.
However, costs vary significantly based on your targeting and positioning. Finance and B2B companies may have higher CPCs while consumer brands can have lower CPCs.
Some typical LinkedIn advertising budgets for UK businesses are:
Industry | Average Monthly Budget |
---|---|
B2B Tech | £3,000 – £10,000 |
Finance | £5,000 – £15,000 |
Consulting | £2,000 – £7,000 |
Consumer Goods | £500 – £2,000 |
As you can see, B2B companies have much higher budgets on average compared to consumer brands. But these benchmarks help give you an idea of what other UK businesses may be spending.
What bid strategy should you use?
LinkedIn gives you the choice of two bid strategies for your ads:
- CPC Bidding: You only pay when someone clicks your ad. You control your max bid.
- CPM Bidding: You pay for every 1,000 impressions. You set your max bid per 1,000.
CPM bidding is best for branding campaigns focused on reach and awareness. CPC bidding is ideal for targeting conversions and optimizing cost per result.
Most performance marketing campaigns use CPC bidding to get measurable conversions while controlling cost per acquired customer. But you may use CPM bidding for remarketing to past visitors or visitors to your pages.
How much should you spend to get started?
When getting started with LinkedIn ads, you may not have much data to estimate budgets. In such cases, here are some benchmarks to guide initial spend:
- For a lead generation campaign, start with £500-£1,000 per month.
- For a traffic focused campaign, begin with £300-£600 per month.
- For brand awareness, you can test with £1,000-£2,000 per month.
These budgets let you gather data on costs and conversion rates, which can then inform larger budgets. Make sure to track conversions diligently.
Many brands also advise starting with a small daily budget, and increasing it slowly as you find which messages, audiences and placements work well. Aim for an initial daily budget of £20-£50.
How should you structure your budget across campaigns?
Rather than focusing on one LinkedIn campaign, having multiple simultaneous campaigns lets you test different targeting and messaging options. Here is one way to allocate budget across various campaigns:
- Lead gen campaign 1: £500 per month
- Lead gen campaign 2: £300 per month
- Brand awareness: £500 per month
- Remarketing: £200 per month
- Job applicant targeting: £100 per month
This totals to a monthly budget of £1,600 across 5 campaigns. The lead gen campaigns take priority and the largest share of budget. Branding and remarketing get smaller initial budgets.
You can start with this structure and then optimize budget allocation based on which campaigns perform best. Don’t hesitate to pause low performing campaigns and redirect that budget to better performing ones.
Allocate budget dynamically
Rather than allocating fixed budgets, use a dynamic approach:
- Set campaigns to maximize conversions within a total budget
- Let LinkedIn automatically shift budget to better performing ads
- Allocate minimum budgets to new campaigns for testing
- Add surge budgets during special events or sales campaigns
For example, you could set a total monthly budget of £2,500 and let LinkedIn dynamically shift this budget across campaigns to optimize results.
How can you optimize LinkedIn ad spending?
Here are some tips to optimize LinkedIn ad spend for maximum impact:
- Analyze click volume and conversion rates by audience, ad creative, landing page etc.
- Identify your best performing combinations and allocate more budget.
- Cut back budget on underperforming targeting options.
- Test new creatives and messaging to improve CTR.
- Improve landing pages to increase conversions and lower CPL.
- Set up negative keywords to avoid irrelevant clicks.
- Use remarketing to re-engage visitors who did not convert.
Continuous optimization and testing is key to improving LinkedIn ad results over time. Small tweaks to target better suited audiences and craft more compelling ads can have a big impact.
What is the ideal LinkedIn ad frequency?
Ad frequency refers to how often someone sees your ads. The ideal frequency depends on your objectives:
- For awareness, higher frequency (4-6 times) builds familiarity.
- For consideration, moderate frequency (3-5 times) makes sense.
- For conversions, lower frequency (2-4 times) helps avoid fatigue.
When optimizing for conversions, showing an ad too many times can annoy prospects and reduce CTR. Use LinkedIn’s frequency capping and sequential messaging tools to ensure optimal ad visibility.
You can also consider decreasing frequency for recipients of your marketing emails, as they already hear from you regularly. Look at frequency distribution reports to identify high frequency segments and reduce visibility.
How can you forecast future LinkedIn ad budgets?
To plan LinkedIn ad budgets beyond initial testing, use these methods:
CPA Targets:
Set target cost per acquisition (CPA) for your goals. Then project volume to determine total budget needed.
E.g. If target CPA is £50, and you forecast 500 leads per month, total budget = £50 * 500 = £25,000
Past Performance:
Look at your historical spend and results data to forecast budgets for upcoming months. Increase budgets gradually as you achieve scale.
E.g. Increase next month’s budget by 20% over current month based on achieving lead targets.
Benchmarks:
Compare your spend and results to industry benchmarks. Identify gaps and increase spending if needed to reach benchmark CPCs and conversions.
E.g. If your CPC is below industry averages, increase budgets to become more competitive.
Seasonality:
Account for sales cycles and seasonal demand. Increase budgets during high demand periods and reduce during slower periods.
E.g. Higher budgets may be needed around major events, product launches, or customer renewal periods.
Conclusion
Determining LinkedIn ad spend requires testing different budgets and tracking conversions diligently. Start small while you identify high performing combinations. Increase budgets gradually as you optimize targeting and creatives. Use dynamic allocation and keep optimizing to get maximum results from your LinkedIn ad investment in the UK. Aim for budgets benchmarked to your industry and audience.