Establishing a good bidding strategy on LinkedIn is key to maximizing results within your budget. Some strategies will give you more control over your Cost per Click, while others are completely automated. Today, we will look at all the possible LinkedIn Bid types, and how they align with your Marketing goals.
What is a bidding strategy on LinkedIn?
On LinkedIn, a bidding strategy is the way you set the maximum amount that you are willing to pay per click, view, impression, or send.
In other words, you use LinkedIn bid types to guide algorithms towards how you want your budget to be spent. And how they should charge you for a specific action that the user took in regards to your ad.
How does bidding work?
If you already have experience with digital advertising and know how bidding works, you can skip this point. However, if you are new to it, and LinkedIn campaigns are your first encounter, bare with me for a second. Because I think it is very important to explain how bidding works in Digital Marketing.
In traditional advertising, if you want to place your ad on a huge billboard, you speak to the company that offers it. At the same time, they are probably speaking with other potential advertisers as well. Usually, the one who is willing to pay the maximum amount is the one who gets the space.
When it comes to digital advertising, the process is very similar but not exactly the same. You see, when you want to purchase ad space from the digital channel, you place a bid. Which is the maximum amount that you are willing to pay for a single click, view, etc.
However, you are not really speaking directly with the channel. Instead, you use the Campaign Manager (in the case of LinkedIn) to communicate this information. But because thousands of other advertisers are doing the same as you, LinkedIn has to establish an automatic process to decide who gets to appear on users´ feed, and when.
Showing up on your audience´s feed
And this is where bidding comes in place. Every time a user scrolls on their feed, multiple advertisers “fight” for his attention by bidding with the maximum amount they are willing to pay.
However, because they are so many, and some of them have an infinite budget while others a limited one, LinkedIn can´t let always “the big guys” win. If that was the case, small advertisers would never stand a chance against them!
For this reason, LinkedIn considers three things:
- Your bidding strategy (bid type);
- The maximum amount that you are willing to pay;
- And the quality score of your ad.
In other words, how relevant it is for the user.
Your quality score, also called relevance score, is determined by factors such as:
- The Click-through rate of your ad (CTR);
- Engagement rate;
- Member feedback;
And although LinkedIn, as opposed to Google, never really shows you your quality score, you can use you engagement and CTR rate to get an idea of how you are doing.
LinkedIn Bid types
And now that we have explained how bidding works, it is time to see the different LinkedIn bid types. With bid types, what you need to know is that not all of them are available with all LinkedIn ad formats.
They are also aligned with the different ad objectives that Campaign Manager offers. So, not all types are available for all objectives:
If you are not familiar with the concept, an objective is the goal that you choose for your campaign. In other words, what are you trying to achieve with it? Generate more leads, get users to download a brochure, invite them to an event, or obtain more video views?
1. Automated bid
Objectives: Brand awareness, Website visits, Engagement, Video views, Lead Generation, Website conversions, Job applicants
Ad formats: Single image ad, Carousel image ad, Video ad
If you select automated bid, instead of selecting yourself the maximum amount that you are willing to pay per action, LinkedIn will do it for you. Automated bidding uses machine learning to try and get the best results for your budget.
Of course, these results will depend on the objective that you´ve selected.
For example, if you select Brand awareness as your objective, LinkedIn will try to get as many impressions (ad views) as possible within your budget limitations. If you select Carousel or Sponsored Content, the system will try to get the maximum number of clicks, and so on.
In my opinion, not setting a cap for your bid might not be very efficient for your results. Because you are leaving your bid in the hands of LinkedIn, and there is no limit, your Costs per Click might go up to the sky. For this reason, the next bid type that we are going to see will be one that gives you more control over your spending.
2. Maximum Cost per Click (Maximum CPC)
Objectives: Website visits, Engagement, Lead Generation, Website conversions, Job applicants
Ad formats: Single image ad, Carousel image ad, Video ad, Text ad, Spotlight ad
Maximum CPC bid, also known as manual bidding, is one of the LinkedIn bid types that gives you the highest control over your spending. It allows you to manually set the maximum amount that you are willing to spend per single click.
Usually, LinkedIn will give you a recommended bid amount, which is calculated taking into consideration:
- Your campaign segmentation – some audiences are significantly more competitive than others, which means that the average bid would also be higher.
- What other advertisers are bidding – the Campaign Manager is going to give you a range of the minimum and the maximum amount that other advertisers are spending per click for a segmentation similar to yours.
It is completely up to you to set your bid depending on your budget and goals. However, I strongly suggest that you intend to bid at least above LinkedIn´s recommendations. If you try to bid lower, the chances that your campaign will underperform (not show up as often) are higher.
Some ad formats, such as Sponsored Content, will not show the option for Maximum CPC bid directly. Instead, they will show Enhanced CPC (which we will see next), and to reduce it to Maximum CPC, you will need to uncheck this box:
Once you have un-checked it, it will automatically convert to Maximum CPC.
3. Enhanced Cost per Click (Enhanced CPC)
Objectives: Website visits, Engagement, Lead Generation, Website conversions
Ad formats: Single image ad, Carousel image ad, Video ad, Follower ad
Enhanced Cost per Click is a bidding strategy that is very similar to Maximum CPC. It lets you set on your own the highest amount that you are willing to spend per click, which means that LinkedIn cannot get over it.
However, there is one difference with Maximum CPC. If you select Enhanced CPC, the system will auto-optimize your bid to deliver your ad to those who are most likely to engage, click, or convert. In comparison, Maximum CPC will show your ads to everyone within the Cost per Click limits, whether he is likely to convert or not.
How does LinkedIn calculate who is more likely to engage or convert? The algorithms look into the historical data of their members, and whether they have converted or engaged with content similar to yours in the past.
If they are generally active on LinkedIn, and show interest in other ads or organic publications like that, they are considered more likely to convert.
Not all ad formats that offer Maximum CPC bid offer this option for auto-optimization. For those that do, I highly recommend that you use it!
4. Maximum CPM bid
Objectives: Brand awareness, Website visits, Engagement, Video views, Lead Generation, Website conversions, Job Applicants
Ad formats: Single image ad, Carousel image ad, Video ad, Text ad, Spotlight ad
If you select Maximum CPM bid as your bidding strategy, you will be charged per 1,000 impressions. This is the number of times that your ad was viewed by LinkedIn members. In other words, paying for 1,000 impressions would mean paying for each 1,000 times your ad was viewed.
Keep in mind that we are not talking about unique views. So, if the same user saw your ad 3 times, all of them will count towards the 1,000 count.
Another thing to consider is that your bid has to be higher than your daily budget. For example, if you are willing to pay 28 euros per 1,000 impressions, your daily budget cannot be 25 euros.
I personally don´t recommend this bid type unless your main objective is brand awareness. With this strategy, LinkedIn will try to optimize your ad delivery for ad viewing, but not for actual results. So, if your goal is to drive more leads or traffic to your website, it will not be the most efficient strategy.
After all, viewing an ad does not mean anything if the person don´t click on it or interact with it.
5. Maximum CPV bid
Objectives: Video views
Ad formats: Video ad
Next on our list of LinkedIn bid types is Maximum CPV bid, or in other words, Maximum Cost per View bid.
With this strategy, you are bidding on the highest amount that you are willing to pay for a single video view. The price for view is usually lower than the one for impression, although not necessarily.
Keep in mind that a view does not mean that the person has viewed the video till the end. If he only viewed 10% or 20% of it, it will still count as a view. Generally, it will count if he click on Play to start watching it.
With this strategy, LinkedIn will try to deliver the ad to those who are more likely to watch it for 2 seconds or more.
6. Maximum CPS (Cost per Send)
Objectives: Website Visits, Lead generation, Website conversions
Ad formats: Message ad
You can only use this bidding strategy with the ad format Message ad, previously known as Sponsored InMail. It allows you to deliver ads directly to the inbox of your target audience. For this reason, it is charged by Maximum Cost per Send, or Maximum CPS.
As with similar bidding strategies, this is the maximum amount that you are willing to pay per single InMail send. If you have chosen this ad format, you will have no other option but to go with this bid type.
And that is basically all from me, folks! As always, thank you for taking the time to read my article, and I hope to see you in the next one! Also, if you need help with your LinkedIn advertising, you can send me an email to the email address in this banner: