Episode 2: Where Do LinkedIn Ads Fit Into Your Marketing Mix? | With AJ Wilcox

Full transcript:

David Bain  00:00

Where do LinkedIn ads fit into your overall marketing mix - with AJ Wilcox.

The Strategic Marketing Show is brought to you by Insights For Professionals: providing access to the latest industry insights from trusted brands on a customized, tailored experience. Find out more over at insightsforprofessionals.com.

Hey, it’s David. Is your brand currently using LinkedIn ads? Maybe you're considering LinkedIn ads, but you haven't quite hit the ‘Publish’ button yet. Today, we're discussing why you should be using LinkedIn ads and where LinkedIn ads should fit into your overall marketing mix with a man who's managed over $150 million of ad spend on the platform. He’s the host of the LinkedIn Ads Show and founder of B2Linked, a LinkedIn ads specific agency that he started back in 2014. A warm welcome to the Strategic Marketing Show - AJ Wilcox.

AJ Wilcox  01:02

Thanks so much, David. I'm so excited to be here! 

David Bain  01:05

Great to have you on AJ! You can find AJ over at b2linked.com. So, AJ, why LinkedIn ads?

AJ Wilcox  01:11

Well, I think it really comes down to the audience that it's able to target. For us, in business-to-business, it's really difficult to find any channel that allows us to hit our ideal target audience. LinkedIn really stands on its own here.

Think about any other way of reaching them. With search channels, you're waiting for people to come and search for your keyword, but you have no way to qualify and make sure that they're the right person, or represent the right kind of company. Facebook is fantastic but it only understands people from a B2C perspective - as a consumer. It doesn't understand who they are professionally. You start to scale up there and you find it's reaching people, but you disqualify 95% of them in your sales funnel. LinkedIn is like a sniper rifle - being able to laser target the exact right people.

David Bain  02:01

Okay, so what you're saying is: B2B people are on Facebook, but the targeting on Facebook means that it's actually difficult to display an ad directly to them. So, the hyper-targeting available on LinkedIn ads makes it more appropriate.

AJ Wilcox  02:17

Exactly. I mean, I believe the right B2B people are on every platform. They're on TikTok, they're on Instagram, they're on Facebook, but for you, as an advertiser, reliably targeting those exact people is near impossible because the platform doesn't cater itself to a business-to-business audience. LinkedIn is the only one that does. They charge quite the premium for that ability, but that's the reason we pay that premium: it’s for that crazy targeting.

David Bain  02:44

Okay, so you pay a premium. Does that mean that LinkedIn ads are only appropriate for bottom-of-funnel immediate calls to action, something that would likely result in a sale reasonably soon? Or can we use LinkedIn ads for top-of-funnel as well?

AJ Wilcox  03:00

I think it really should be used at all parts of the funnel. You're right, the costs are high. I like to talk about LinkedIn like it's more of a middle-of-funnel type of platform, but it costs like a bottom-of-funnel. LinkedIn is a type of display advertising. Display people, because they're not searching actively for what it is you do, are not ready to make a purchase decision - they're not ready to make a commitment yet.

I love LinkedIn for bottom-of-funnel when we're using it for retargeting because we've already warmed them up. They've already interacted with our brand in some other way that we've been able to track and measure. I love it for middle-of-funnel because it's so good at making sure that we're hitting people who feel your pain point. If you have software that makes your job easier for HR people, for instance, we can make sure that only HR people are seeing the ad. So, it's great for middle-of-funnel, and people who are willing to fill out forms to get stuff that they want.

It's pretty good for top-of-funnel as well. Because you're gonna be so specific about who's seeing your ads, you can make sure that you're getting your brand in front of the right people. It is very expensive for top-of-funnel, but when you combine it all together into one steady and strategic sequence, it all evens out really well.

David Bain  04:21

So, if a listener is a marketer within a large organization, working for a brand that has a fairly long sales cycle, where are the ideal touchpoints where LinkedIn ads would work really well? Are we talking about discovery being on organic search, driving people to some kind of lead capture, and then retargeting people on LinkedIn ads in middle-of-funnel, as you suggested?

AJ Wilcox  04:51

I think it's kind of flipped a little bit. For just discovery, for letting people in your target audience know that your brand exists and what you do, LinkedIn is so good at that because you know that this is someone who feels your pain point, so you can let them know that your brand exists. I think that discovery really works well starting on LinkedIn.

Then you’re ensuring that you have retargeting set up, ensuring that you are bidding on the proper keywords, ensuring that you are on other platforms - so that when they then go to those other platforms and check you out, or encounter you, they're much more likely to feel like you're legit, and it's worth pursuing.

I like LinkedIn to play that initial ‘introducing you to the brand’ phase. It just so happens to have really good retargeting now that, as of a year ago, they didn't. Now, it has really good on-platform retargeting, so I think it can play both roles really well.

David Bain  05:47

Does it have good off-platform retargeting as well? Can you use LinkedIn scripts on your own website to then retarget people on LinkedIn?

AJ Wilcox  05:55

They do have the script, they call it ‘LinkedIn website retargeting’, but it's not very good. It's 100% reliant on cookies. Right now, all Apple devices don't reliably carry that cookie, so there goes half of your audience if you're in North America. We know Chrome, by mid-2023, isn't going to carry that cookie either.

I’m not quite sure what's going to happen with off-website retargeting. At least when you're on LinkedIn, we now have really reliable targeting.

David Bain  06:27

Okay, so maybe a campaign looking at discovery to begin with, and then retargeting them with a stronger brand call to action, then getting them on your website with a view to building an email list from there?

AJ Wilcox  06:43

Yeah, I think so. There are also LinkedIn’s native lead gen forms that work really well. If you don't have a great lead generation landing page on your website, or someplace to send them, you can have the form populate right within the ad. They tend to convert two to three times better than a landing page would. We have a lot of clients who are using those as well.

David Bain  07:05

So, going back to the discovery aspect of it, what does great, effective creative for the discovery phase look like? Are we talking about something like, if you regularly do a video podcast, perhaps taking a segment of that and adding captions to it and then sharing that on LinkedIn? Is that a nice ad, or are you talking about something that's more brand and product specific?

AJ Wilcox  07:31

I think it depends on the brand, it depends on the audience, and where they're at in the funnel. Initially, I would say that video ads on LinkedIn tend to be about 20% more expensive than static image. If you happen to have good video creative that you want to test, it's a good platform for it, but I generally like to test with static image and copy first.

If you do video, the key is that people on LinkedIn are in a hurry. They're scrolling through their newsfeed for information, and they're not usually there to be entertained. You have to get their attention within the first second. You never want a video fading from black, because you're just wasting all of your time for that initial hook.

For something like a podcast episode, a little interesting snippet with captions could work really well. So could an image of a person, or an image of some sort of eBook and you're saying: ‘By downloading this eBook, this is what you're going to learn.’ They can all perform really well, but I would probably start with static image just because the cost is a little bit better.

David Bain  08:40

Interesting. My initial thoughts were perhaps video because I'm finding that, from an organic perspective, publishing video tends to gather more engagement, likes, and people commenting on the post, and not so much with static.

With the cost being 20% higher for video, does that mean that you may actually get a 20% better conversion rate from video or not necessarily? 

AJ Wilcox  09:07

Potentially, and that's the magic of video. You can watch me for two minutes and feel like you already know and trust me better than if you downloaded five of my whitepapers. Video really does play an important part in communicating emotion and, if used correctly, I think that's accurate. We pay 20% more for the click, but your conversion rate should be at least 20% better, if not higher, when done correctly.

David Bain  09:36

What are the metrics to keep an eye on to demonstrate LinkedIn ad success?

AJ Wilcox  09:42

I think your very first line of defense, really, is your click-through rate. I like to picture that, when you're trying to get someone to take a conversion action, you have two hurdles to get over. The first hurdle is: you're showing an ad and you need someone to click on it. Then, once they've clicked, you need them to convert.

That first hurdle is your click-through rate. We know that LinkedIn’s average click-through rate on a sponsored content ad, the newsfeed ads, is around 0.45%. If you launch an ad and you are well above that, that's a pat on the back for you: ‘Okay, it looks like we're flying over this first hurdle. Our ads are engaging.’ That's what I can tell myself. If you're under that, you might say, ‘Oh, our ad creative is not getting people's attention. Maybe we're not hitting that pain point we need to.’

The next one, obviously, is conversion rate.

David Bain  10:32

That's a great metric to be aware of.

AJ Wilcox  10:33

Once they've clicked, now we want to see at what rate we are actually getting them to take action. That one is getting harder to track without cookies.

There is conversion tracking on every platform - LinkedIn is similar there. It's a lot better if you're using their native lead gen forms, because then conversion tracking is automatic. LinkedIn knows exactly who and when someone fills out that form.

That’s how we can tell that, we’ve shown them the message to get them interested, but are we showing them enough to get them to actually want to convert? To get them over that hump of providing information to becoming a lead.

It depends on the kind of call to action too. If your call to action is something like ‘Download this free piece of content’, I expect to see conversion rates in excess of 15%. If you're asking someone to do something high friction, like talk to sales, get a demo, take a free trial, or buy something, then we expect conversion rate to be somewhere between about 1.5 to 3%.

David Bain  11:39

Okay. So, what types of brands are doing really well with LinkedIn ads at the moment? Do you have a specific case study that you can share, just to demonstrate what a brand has done successfully with LinkedIn ads recently?

AJ Wilcox  11:52

One I want to point out is a company called BambooHR, here in the US. It's a SaaS solution for senior HR leaders. They want to be the platform where companies come to recruit talent, manage their internal workforce, and all of that. So you can imagine, they're really only interested in getting in front of HR people. If they went and put a billboard up on the freeway to try to reach people, maybe 1 in 300 is an HR person. It's not very reliable.

So, they came to us for LinkedIn ads. They understood the value of making sure they're getting in front of just HR people, and not wasting impressions on anyone else. What was funny was, for the first three months of working with them, they had eBooks, they had guides, they had this kind of stuff for us to pitch, and we also tried very bottom-of-funnel things, like ‘Get a demo’ - but we couldn't get any of it to work. We were struggling to get conversion rates anywhere above 2 or 3%, even though we were offering content.

It just wasn't working. We were fighting to get any cost per conversion under $127. I thought for sure we were going to lose the client. What was so interesting was that overnight, without warning, they came to us and they said, ‘Hey, by the way, we just released this new piece of content. It's called The Definitive Guide to Onboarding.’ I didn't know at the time, because I'm not super well versed in HR, but onboarding was a really big topic in HR. There were so many companies who were having trouble making sure that their new employees had a great experience coming on, so they'd want to stay longer and stay engaged.

This guide, for a bunch of reasons, defied all of my expectations. It took our click-through rates to three times the average, our conversion rates doubled from where they were at. We ended up getting the cost per lead down to the 20s of dollars range. We've seen assets that do that, and the stark contrast was very interesting, but what was even more interesting was that for six months we couldn't dethrone that ad. We had launched that ad, with that offer, and after it had run its course, and we could see performance start to decline a little bit, we would turn it off and try to replace it with something else. Nothing outperformed it for six months.

I think that really punctuates the point that it's not the fact of whether or not you have content for people to download. It's about, does that content hit on an issue that they care about? Is it teaching them something that they're dying to know?

We talk about having a migraine problem versus a headache problem. If your content solves a migraine problem, that's going to get people to take action. If it solves a headache problem, you can work through a headache, but a migraine is ‘Stop the presses. I can't go to work today.’

David Bain  14:58

I think that's a lot of great advice there. If you've got a specific job title of someone that you want to target then absolutely give LinkedIn ads a go but, if you've got content that is likely to highly resonate with that target audience then that's the way to go, by the sound of it.

Also, split test as well. Are you able to quite easily split test different calls to action and different content to see what's performing the best?

AJ Wilcox  15:29

it's a little harder to split test on LinkedIn. For the last four years, LinkedIn has told me that they're coming out with a split-testing tool, and it was in alpha for a little while, but I don't think it performed very well.

Right now, we really have two options for bidding, much like Google Ads back in the day. We can optimize our creative for click-through rate, which is what I recommend and what they recommend, or the other option is to rotate your creative evenly. A lot of split testers say, ‘Of course I want to rotate my creative evenly, so that I can get even exposure and see which one's outperforming.’

What we've figured out is that it doesn't actually show your ad evenly. What it does is it enters both into the auction evenly. But, because one is going to perform better than the other, the one that doesn't perform as well gets entered into the auction just as many times but loses auctions more, so it doesn't show very often. The times that it does win the auction, it's at a higher cost, because it's not as good of a performer.

When we switch over to that (I call it the ‘charge me more and show me less’), it's not great. What we do to combat this is we actually end up running that same A/B test on optimize for click-through rate, but we run it across multiple campaigns. In any one campaign, you can have an aberration, but if you have the same test running in four or five different audience segments, now you can be a lot more confident in the result. So that's how we A/B test.

David Bain  17:02

Superb. Just one final thought actually. If split testing’s not really great, then surely you've got to do your own audience testing to begin with, ideally, before you actually start publishing ads? How about running something like a little audience focus group on who the ad is targeted at, and talk about what kind of content is likely to resonate with them, and build content around that? Is that something you'd suggest?

AJ Wilcox  17:33

I really like using LinkedIn ads for market research. Anytime you gather a focus group, it takes a lot of money, it takes a lot of time, and it takes hiring expertise. Even still, when you ask a human, ‘Why did you make this decision?’ - they emotionally made a decision and now they're trying to put into logic why they did, but that's not usually why.

However, I could take an A/B test and have one ad that makes them feel like the hero and one ad that's warning that ‘If you don't do this, you're gonna get punished.’ If I run both of those ads to, say, a segment of managers, another segment of directors and other VPs, and maybe one of CMOs, what we can find is - based on which ad got the engagement in each of those different seniority levels, we start to learn what it is that seniority cares about.

That would be my preference: to actually put a little bit of money towards running an A/B test on LinkedIn. Maybe it's $100, maybe it's $1,000, whatever. I think you can learn more about user behavior by just testing using the platform. There are cheaper ways. You can test by posting content organically on LinkedIn and watching who is interacting with it, but the problem with organic is you're not controlling who is seeing it, so it's a much wider audience. With ads, we can be very precise.

David Bain  18:57

Let's move on from what works now to planning for the future. In your opinion, what is the biggest marketing trend or challenge for marketers over the coming year?

AJ Wilcox  19:05

I don't know how many are familiar with the term ‘Cookiepocalypse’, but so many of us have heard about cookies going away. In the last couple of years, Apple has waged war against cookies. We talked about the fact that Apple devices don't reliably carry a third-party cookie, which makes things like retargeting - even conversion tracking - difficult. We know that within the next year, Chrome is going to do the same thing, so there goes pretty much all of our cookies. A lot of marketers are having trouble with what this means for their data. Analytics is a lot less accurate - we don't know what the impact is on analytics.

There are two kinds of marketers who I think can be relatively unaffected: that's eCommerce marketers and B2B. These are not often lumped together, but the reason why I say that they can be unaffected is that in eCommerce, you have impressions, you have clicks, and then you have the purchase. There's no refuting whether or not someone put something in their cart and checked out. Whether or not they have a cookie, you have money in your account. It's really easy to figure out what your return on investment is.

In B2B, we may lose conversion tracking inside the platform - having a little number increment to say you got a conversion - but what we do have, if we're doing it right, is that all of the data when someone fills out a form goes into the CRM. There is a record in the CRM, because someone filled out a form. We don't need to rely on any platform to guess or estimate how many conversions we should have had given that spend. We actually know.

What that means for us as marketers is that we need to get more technical by making sure that we have data flowing into a CRM. It means we need to then combine our CRM data with our ad performance data and figure out how to use that for reporting, so that we can see what our cost per marketing qualified lead is, our cost per sales qualified lead, and you can trace all the way down to return on investment. Over the last several years, I've seen marketers getting more and more technical and adept with data. That's where we need to be, and losing the cookie is the swift kick in the butt that I think some marketers need. Stop all the presses, we need the CRM connection in B2B.

David Bain  21:24

I’ve been your host David Bain, you can find AJ Wilcox over at b2linked.com. AJ, thanks so much for being on the Strategic Marketing Show.

AJ Wilcox  21:31

You bet David, have an awesome one.

David Bain  21:33

And thank you for listening. Here at IFP, our goal is simple: to connect you with the most relevant information, to help solve your business problems all in one place. insightsforprofessionals.com