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LinkedIn Super Charges Ads With Major AdTech Deal

LinkedIn Latest Acquisition Will Power Improved Ad Targeting & Attribution

LinkedIn’s bumper 2019 continues apace with its acquisition of advertising tech business Drawbridge, for an undisclosed fee.

Drawbridge's advanced artificial intelligence will be used to help improve reach for LinkedIn's Matched Audiences and Audience Network campaigns, providing better marketing attribution.

After 13 years in the doldrums, LinkedIn’s ad business to booming, with LinkedIn’s Marketing Solutions revenue up 46% year on year.

LinkedIn’s ad business finally means business.

The Drawbridge deal is the latest development in a long list of recent tie-ups aimed at improving LinkedIn’s notoriously weak marketing offerings.

LinkedIn’s Challenging Journey From Ugly Ducking To Swan

Purely from a marketers perspective, LinkedIn has a range of unique challenges to address, if it is to join the marketing big leagues.

Let’s assume that LinkedIn has addressed its original weakness, i.e. it was a comparatively poor marketing channel.

Following its $24 billion Microsoft acquisition, LinkedIn has made significant strides.

Although to be fair to LinkedIn, some of this was underway previously:

  1. Improving the core product
  2. Human curating news feed
  3. Belated native video roll-out­­
  4. Smart business influencer partnerships
  5. Reducing spam and visibility of ‘LinkedIn Ninjas’
  6. Introducing 21st Century marketing tools
    1. Outcome centric campaigns
    2. Remarketing and custom audiences
    3. Pixel tracking and conversion reporting

The next challenge for LinkedIn, which in some ways is perhaps greater, is being able to prove to marketers that it adds demonstratable value.

Hence the Drawbridge acquisition.

LinkedIn’s Premium Marketing Solutions

LinkedIn is one of the more expensive online channels to run paid activity.

According to Adstage, LinkedIn’s median Q1 2019 stats were:

  • Median Cost Per Click (CPC) = $3.99
  • Median Cost Per 1000 impressions (CPM) = $7.85
  • Median Click Through Rate (CTR) = 0.18%

Let’s see how LinkedIn benchmarks versus THE DUOPOLY:

  • Google
    • Search engine marketing (SEM)
      • Median CPC = $1.46
      • Median CPM = $38.40
      • Median CTR = 2.72%
    • Google Display Network (GDN)
      • Median CPC = $0.30
      • Median CPM = $2.40
      • Median CTR = 0.42%
  • Facebook (based upon News Feed only)
    • Median CPC = $0.63
    • Median CPM = $8.40
    • Median CTR = 1.33%

Based upon Adstage’s latest Q1 data, LinkedIn comes in with a price premium to reach an audience which is far less engaged, based upon ad CTRs.

Does LinkedIn Reach The Parts Other Platforms Can’t?

Now, one could argue that LinkedIn that has a user base it is not possible to reach in other channels.

Given that Google reaches 93% of active internet users in AU/NZ and Facebook reaches 80%, that is hard to believe.

At a push, Facebook is more believable, but Google? Really?

Even CEO’s who type like Tony Abbot have Google shortcuts on Internet Explorer.

If LinkedIn does have a truly unique user base, it is likely to be nominal. Especially given the promiscuity of web users, using differing platforms for differing purposes.

It is clear then that LinkedIn still has a challenging road ahead of it on the advertising front.

On the unpaid front, LinkedIn’s organic reach is booming right now, which is positive, albeit more so for personal branding than actual brands.

Again, something LinkedIn will need to address if it wants to be taken more seriously for corporate communications.

The relaunched LinkedIn Pages hopefully signify a shift here, through 2019.

LinkedIn’s Ads At Second Glance 

Based on the Adstage data above, it is hard to imagine why anyone would spend on LinkedIn.

However, the stats above are averages across all industries.

If one were able to break out the Google and Facebook Adstage data just for business to business (B2B) marketers, it would paint a very different picture.

Google, Facebook and LinkedIn, all come in at a price premium for B2B (relative to B2C). See this recent Wordstream data which benchmarks Facebook performance by vertical.

As a general rule, the sexier the vertical and/or campaigns, the lower the cost.

Viewed more on that basis, one would expect LinkedIn to still perhaps come in worse off, due to having less scale, but the gulf is much smaller.  

Solving LinkedIn’s Evaluation Conundrum To Prove ROI

The challenge for all platforms chasing B2B dollars is demonstrating a return.

Little serious enterprise activity happens online via marketing, relative to offline via sales or account management.

With this in mind, whoever develops the best marketing attribution across long, complicated journeys, involving a range of internal stakeholders, across multiple devices, culminating in conversions recorded via a customer relationship management (CRM) system, will win.

At the moment, this is a race which LinkedIn is far ahead on.

It’s Drawbridge acquisition, alongside recent partnerships with Adode and Oracle, combined with growing integrations with Microsoft’s tech stack will put LinkedIn in a league of its own­.

LinkedIn’s journey from marketing ugly duckling to swan is a 13-year marketing saga that the writers of She's All That would have been proud of.

 

 

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