What is the average spend for a LinkedIn ad?

LinkedIn ads can be a great way for businesses to reach their target audience, but determining the right budget can be tricky. Here’s a look at average LinkedIn ad spend to help guide your strategy.

Average Daily Spend

Most experts recommend starting with an average daily budget of $10-$50 per ad set. This provides enough spend to get your ads in front of your target audience without breaking the bank. As a general rule of thumb:

• B2C businesses should aim for $10-$30 per day
• B2B companies can budget $30-$50 per day

Of course, your ideal daily spend depends on factors like your industry, target CPA, and campaign objectives. Tracking performance at the ad set level and optimizing over time is key.

Average Cost Per Click

In addition to daily budget, average CPC is an important metric to consider. LinkedIn’s auction-based advertising model means there’s no fixed CPC. Costs vary based on factors like competition, match types, and targeting.

Here are benchmarks for average LinkedIn CPC by objective:

Understanding these benchmarks allows you to estimate how many clicks your budget can buy. From there, you can calculate potential reach and engagement.

Average Cost Per Impression

Impressions indicate how often your ads are being shown. Average CPMs on LinkedIn fall within the following ranges:

With CPC and CPM data, you can forecast impressions based on daily budget. Sponsored content tends to have the highest CPMs but also drives greater engagement.

Average Cost Per Lead

For bottom of the funnel goals like lead gen, CPL is a key metric. Average costs per lead vary significantly based on factors like industry, offer, and lead quality.

Here are benchmarks for average CPL across common sectors:

Tracking your own CPL over time and optimizing for conversions can help improve performance.

Average Cost Per Conversion

For campaigns focused on driving conversions like whitepaper downloads or sales, average CPA is key. Like CPL, CPAs can vary substantially.

Typical CPAs for LinkedIn ads include:

• Whitepaper download: $10 – $30
• Free trial sign-up: $50 – $100
• Software demo: $100 – $250
• Ecommerce purchase: $20 – $50
• Webinar registration: $30 – $60

Dialing in your target CPA takes testing and optimization. Start high and work downward to find cost-efficient conversion rates.

Average Monthly Spend

When it comes to monthly ad spend, most experts recommend allocating at least $1,000-$2,000 per month to see meaningful results from LinkedIn ads. Here are some benchmarks by business type:

B2B companies should aim to invest at least $2,500 per month for LinkedIn ads. For B2C brands, $1,000 per month is a reasonable starting point.

Tips for Setting Your Budget

When determining your LinkedIn ad spend, keep these tips in mind:

• Set aside at least $1,000-$2,000 per month for meaningful reach and results
• Use benchmarks based on objective and industry as a starting point
• Test different daily budgets and CPA targets to find what works
• Analyze performance data to optimize spend over time
• Increase budgets gradually once you have winning creatives and targets
• Consider both direct response and brand awareness goals in spending

The Role of Testing & Optimization

Dialing in profitable LinkedIn ad spend requires rigorous testing and ongoing optimization. Here are some tips:

• A/B test different daily budgets and CPA targets
• Experiment with bid strategies like CPC vs CPM
• Try various audience segments and targeting methods
• Refine creatives, offers, and landing pages over time
• Monitor performance data and shift budgets to better-performing ads
• Build out negative keyword lists to reduce irrelevant spend
• Automate bid management using LinkedIn’s automated tools

Continual optimization and improvement will help you maximize the results from your LinkedIn ad investment.

The Impact of Competition

Competition has a major influence on LinkedIn advertising costs. More competition for your target keywords, audience, and placements will drive prices up.

Ways to gauge competition include:

• Researching competitor ad spend and strategies
• Using LinkedIn’s keyword planner to view suggested bid estimates
• Analyzing the number of advertisers bidding on an auction for each placement
• Testing different match types (broad, phrase, exact) to understand competitiveness

Competing against larger brands will likely increase your CPC and CPM costs. But you may also benefit from their ad spend educating the market. Savvy targeting and creative messaging can help you stand out.

How Targeting Impacts Cost

Your targeting settings directly impact your LinkedIn advertising costs. Broad targeting scales reach but can reduce relevance. On the flip side, ultra-narrow targeting reduces competition but limits potential impressions.

Best practices for optimizing targeting include:

• Starting broad to gather data, then narrowing your focus
• Using LinkedIn’s Matched Audiences to precisely target your list segments
• Testing different seniority levels, job functions, and company sizes
• Optimizing geographical targeting for your goals
• Adding negative keywords to reduce irrelevant spend
• Reviewing reach estimates to understand potential tradeoffs

Dialing in your targeting is an iterative process. Let data and performance guide optimization over time.

Should You Use Manual or Automated Bidding?

LinkedIn offers both manual and automated bidding options. Manual bidding gives you direct control but requires more hands-on management. Automated bidding uses algorithms to optimize for your KPIs but can be less transparent.

Many advertisers use a combination, starting with manual bidding to gather data. Once you identify profitable targets, automated bidding can help scale. Strategies like target CPA help maintain conversion rates as you expand budgets.

If using automated bidding, be sure to:

• Analyze performance data regularly for insights
• Supplement with manual bidding for priority targets
• Watch for sudden drops in ranks or changes in CPA/CPC
• Make adjustments based on learnings vs relying fully on algorithms

The right balance depends on your campaign goals, resources, and level of control desired.

Best Practices for Optimizing LinkedIn Ad Spend

Here are some top tips for optimizing your LinkedIn ad spend over time:

• Set Specific CPA and ROI Targets: Dial in profitable CPAs and use them to guide bids.
• A/B Test Ad Creative: Continually test new creative to improve CTR and conversion rates.
• Review Reports Frequently: Stay on top of performance data to identify optimization opportunities.
• Refine Targeting: Eliminate low-converting segments and double down on profitable targets.
• Manage Bids Closely: Adjust bids regularly to balance volume and cost efficiency.
• Build Negative Keyword Lists: Add non-converting keywords over time to reduce waste.
• Focus Budget on Best-Performing Ads: Shift budget to the highest-ROI placements.
• Automate Where Possible: Use automated bidding strategically to complement manual management.

Key Takeaways

Here are some of the key facts to keep in mind when evaluating your LinkedIn ad spending strategy:

• Aim for an average daily budget between $10-$50 per ad
• Expect average CPCs from $2-$15 depending on objectives
• CPMs typically range from $2-$50+ based on ad format
• Allocate at least $1000-$2000 per month for meaningful reach
• Use benchmarks by industry and objective to inform budgets
• Continual testing and optimization is key to maximizing results

With the right expectations set and a commitment to ongoing improvement, your LinkedIn ad investment can deliver strong ROI across your marketing objectives.

Conclusion

Determining optimal LinkedIn ad spend requires a data-driven approach based on campaign goals, industry benchmarks, and rigorous optimization. While minimum budgets vary, allocation of $1000-$2000 per month is recommended to make an impact. Use this article’s metrics and best practices to inform budget-setting, then let direct response data guide optimization. With the right targets and vigilance, your LinkedIn ad dollars can work hard driving leads and sales.