There’s no one-size-fits-all solution for advertisers. Strategies can cover a whole range of efforts. Anything from increasing online ad budgets to boost revenue to cutting ad spending to save costs.
Despite the strategy, there’s a general formula that all successful campaigns have in common: investing in digital channels, targeting the right audience, and leveraging various platforms.
The leading ad platforms_Google, Facebook, Instagram, LinkedIn, TikTok, and YouTube_ each have their own unique benefits and drawbacks. Consequently, the cost of online advertising also varies depending on the platform, as well as the industry competition, ad quality, and relevance.
Choosing the right tools to automate the process is another important factor. LeadsBridge integrations help you connect TikTok with just about any CRM and automation tool.
Additionally, integrating financial reconciliation software can enhance your financial management by automating expense tracking and budget allocation for your ad campaigns, helping you maximize your advertising ROI and to resolve advanced issues, such as how to fix reconciliation discrepancies in QuickBooks Online and many others more.
This article is about the advertising costs of the major platforms: Google, Facebook, Instagram, LinkedIn, TikTok, YouTube, and Pinterest. Additionally, we’ll review how ads work on each platform, what factors affect your ad costs, and how to strategize to reduce advertising costs.
TikTok paid ads cost
Why use TikTok for advertising?
With 1.1 billion monthly users, TikTok stands as the fourth most popular social network globally. A study by Morning Consult revealed that over half of all Gen Z consumers are using TikTok, which makes it very attractive for marketers.
Types of TikTok ads
TikTok offers a range of ad types designed for different marketing objectives. These range from driving sales and product discovery (ecommerce) to enhancing brand awareness and engagement (Branding).
Ecommerce solutions ad types
- Collection Ads provide a full-screen mobile experience for users to discover and browse products on an Instant Gallery Page.
- Dynamic Showcase Ads (DSAs) are personalized video ads generated in real-time. They pull information from an updated product catalog.
- Deeplink Ads use embedded links to direct users straight to specific app sections or product pages. Deep links act as a bridge between your mobile app and website, aiming to shorten the buyers’ journey and improve engagement.
- TikTok Shopping Ads are a trio of ad solutions (Video Shopping Ads, Catalog Listing Ads, LIVE Shopping Ads) used for promoting products on TikTok Shop.
- TikTok Lead Generation Ads collect lead information directly on TikTok or direct users to a website for data submission.
Branding solutions ad types
- In-Feed Ads appear within the “For You” feed, designed to blend in with organic content for full-screen, sound-on engagement.
- TopView Ads are the first video seen upon opening the app, capturing attention with creative storytelling without competing content.
- Branded Hashtag Challenge Ads encourage user participation in sponsored challenges, especially by leveraging user-generated content for brand awareness.
- Branded Effect Ads use AR effects, stickers, and filters to allow users to interact creatively with brand campaigns.
- Reach and Frequency Ads offer controlled ad placements with predictable delivery, emphasizing transparent media planning.
- Top Feed Ads are premium in-feed ads that appear as the first item upon app launch, maximizing visibility and impact.
Below are three examples of successful TikTok ad campaigns from eBay, Dove, and Google, courtesy of WebFX.
How much does it cost to advertise on TikTok?
To begin with, the minimum cost of TikTok ads for CPM stands at $0.50 per mile (thousand). This means that marketers pay 50 cents for every 1,000 views of their ads. The bottom threshold for CPC is $0.02 per click, with advertisers needing to allocate a minimum budget of $500 per ad campaign.
It’s worth noting that optimization tactics help reduce costs. For instance, using automation. LeadsBridge integrations help you connect TikTok with just about any CRM and automation tool.
We discussed how much it costs to advertise on TikTok, but how to optimize these costs? Automation is key.
To optimize your TikTok Ads, you can connect the TikTok Lead Generation form directly to your CRM, using LeadsBridge integrations. This integration automatically syncs your lead data into your marketing tools in real-time.
Check out this complete guide to TikTok Advertising here.
YouTube paid ads cost
As of 2024, YouTube is the second most organically visited website in the entire world, which imperatively means that video ads cannot be ignored as a part of your marketing strategy. An astounding 70% of YouTube viewers will buy a product because they saw a YouTube ad.
Types of YouTube ads
In Google Ads, you can launch dynamic video campaigns across YouTube and various video partner platforms. Using different ad formats helps you to present your content in a way that captivates your audience.
Each video ad format offers a distinct approach to engaging with customers:
Skippable in-stream ads play before, during, or after videos on YouTube or partner sites. Viewers can skip them after 5 seconds, which makes them ideal for broad reach with viewer control. Here’s how they look:
Non-skippable in-stream ads are like skippable ads but can’t be skipped. They are 15-20 seconds long for creating a more impactful messaging. Just make sure to follow Google’s requirements.
In-feed video ads are displayed in YouTube search results, related videos, or homepage. You can tailor them based on user relevance to encourage more clicks.
Bumper ads are non-skippable with a maximum of 6 seconds. They play before chosen videos, and are great for presenting short, memorable messages to a wide audience. Below is an example:
Outstream ads are best used as Mobile/tablet ads outside YouTube. They Start silently with tap-to-sound, and are used for broadening reach beyond YouTube.
Masthead ads appear at the top of the YouTube homepage with 24-hour maximum visibility. They are perfect for new product launches or meaningful awareness campaigns.
How much does YouTube advertising cost?
Analyzing industry benchmarks shows that costs fluctuate considerably depending on factors like the type of ad, targeting parameters, and the industry in question.
Typically, YouTube ads can range from $0.10 to $0.30 per view, while CPC (cost-per-click) ads usually cost around $0.25 to $0.35 per click.
Using LeadsBridge to optimize YouTube ads
Building an audience and gaining visibility can be challenging at times. It could mean having to meticulously enter data, sieve through them, segment them, and more. This is the time you can spend on creating compelling video content. The good news is that you can take all these tasks off your hands by using automation.
LeadsBridge’s YouTube integrations streamline your repetitive tasks, so you can prioritize video creation. There are other integrations to help automate your lead sync process to and from your CRM or other marketing tools.
Discover more about YouTube Lead Ads available in YouTube video action campaigns here.
Google paid ads cost
Google Ads show up on different Google platforms such as the Google search results, Google Display Network, and Google’s AdSense program. As a result, Google Ads has become one of the most popular PPC networks with the best returns on investment ($2 for every $1 spent).
Here are 9 types of Google Ads:
- Search ads appear on Google Search results pages above or below the organic search results. They can target users based on their search queries.
- Display ads are shown on websites within the Google Display Network, and used to target users based on their interests, demographics, or previous interactions with your website.
- Shopping ads display detailed product info, such as images, prices, and business names, directly in Google Search results.
- Video ads are served across YouTube and other Google Display Network sites. This allows advertisers to engage users with video content.
- App ads promote mobile apps across Google’s entire inventory, including Search, Play, YouTube, and the Google Display Network. These ads use machine learning to optimize app promotion.
- Discovery ads appear in highly visible Google feed environments like the YouTube home feed, Gmail promotions tab, and the Discover feed on Google.
- Local services ads connect local service providers with potential customers in their area. They appear at the top of Google Search results and on the Local Services site.
- Performance max ads create a goal-based campaign type that uses Google’s machine learning to optimize ad placement across all Google platforms.
- Smart ads (Smart Campaigns) are simplified, automated ad campaigns powered by machine learning to optimize your ads across Google’s platforms.
Before discussing how much it costs to advertise on Google, let’s see how the Google ads auction works.
How does the Google ads auction work?
The Google Ads auction is how the platform decides which ads are displayed for a specific search query and which get positioned on the search results page. Here’s how it works:
1. Keyword matching: Whenever a search is made, Google looks for ads whose keywords match the search query.
2. Eligibility check: It then filters the ads that are not eligible due to settings like targeting preferences or policy violations.
3. Ad Rank calculation: Next, Google calculates the Ad Rank based on several factors:
- Bid: The amount you pay per click on your ad.
- Ad quality: The relevance and usefulness of the ad.
- Ad rank thresholds: Minimum qualifications for an ad.
- Search context: The context of the user’s search (location, device, time of day, etc).
- Impact of ad extensions and formats: The expected result of additional ad information (like phone numbers or site links).
4. Auction outcome: Ads with sufficiently high Ad Rank are displayed, with their position determined by their rank in the auction. The actual position and whether an ad is shown at all can vary with each search. Basically, it depends on the specific competition and context at that moment.
Note: Quality and relevance in ads can win higher bids. This way, users see relevant ads while advertisers reach their target audience at lower costs.
Learn how to predict your Google ads cost with our complete guide to Google ads cost.
Factors affecting Google paid ads cost
1. The industry
Industry impacts Google Ads cost. For example, competitive sectors like Legal, Accounting, and Real Estate have higher costs due to lucrative campaigns. Retail and ecommerce sectors typically have lower costs.
Below is a table showing the average cost per click for all industries.
Target country impacts Google ads costs; U.S. targeting is pricier due to higher living expenses and purchasing power compared to India. Explore CPC rates for various countries below.
2. Quality score
Google uses a quality score to assess ad copy and landing page relevance for keywords. This affects cost per click and ad rank; higher scores result in increased ad ranks and reduced Google ads costs per click.
3. Current trends
Current trends directly affect Google ad costs. For example, the travel industry CPCs decreased during the COVID-19 pandemic, while the apparel industry saw increased conversions during this period (according to Wordstream). Check out the CPC for the travel industry and the apparel industry below.
The travel industry was hit the worst by the COVID-19 pandemic.
The finance industry barely changed during the pandemic. Even during the lockdowns, people were still searching for answers to their finance, loans, and insurance questions. This solid foundation is the reason that the finance industry has the most expensive CPC keywords.
4. Keywords
Keywords can significantly change Google paid ad costs. Some are more expensive due to factors like commercial intent or competition in niches such as legal and accounting. Here are the top 20 most expensive Google ad keywords:
How much do Google ads cost?
Different variables influence Google ads costs. However, the average cost per click for Google Ads is $1 – $2, the average CPC for the Google search network is $1 – $2, and the average CPC for the Google Display Network is $1 or less. The most expensive keywords on Google ads cost around $50.
Now, let’s discuss the ways you can reduce your Google ads.
Strategies to reduce your Google Ads cost
Here are some ways you can reduce advertising costs when using Google Ads:
1. Increase the ad quality score
Here are some ways you can reduce advertising costs when using Google Ads:
2. Use Google Lead Form Extensions
Google Lead Form extensions are ads that help businesses generate leads from mobile search results pages. These forms are pre-filled, which makes the process of submitting contact information easy and quick for the users. Have a look at a Google Lead Form example below.
To optimize your campaigns, you’ll need to first monitor and manage your Google campaigns through CRM or email software. You can do this via LeadsBridge’s Google Lead Form Extensions integrations.
Here are some of our popular Google Lead Form Extensions:
For more information, read our complete guide to Google Lead Form ads for successful Google lead generation.
3. Optimize the keywords
Avoid using generic keywords. Instead, use match types that suit your content to make sure you are spending on relevant SEO target keywords.
4. Customer-first principle
Pay attention to your customer’s needs when creating your ad campaign. Keeping your customers’ perspectives in mind, you can optimize your ad content. Avoid targeting everyone. Instead, target a specific audience that is highly relevant to your ad campaign.
Discover how to use Google Customer Match to target your ideal audience here.
Use these popular LeadsBridge integrations to leverage the power of Google Customer
5. Avoid negative keywords
Based on Google metrics, it is recommended to avoid using negative keywords. This helps you reduce your cost per click while boosting your ROI.
Here’s how to build the perfect Google Ads campaign structure in 2024. Also, you learn more about the Google Ads optimization checklist here.
Facebook Ads cost in 2024
The cost of advertising on Facebook depends on several variables including the bidding strategy you use, your budget, the audience you’re targeting, etc. Facebook uses an advertising auction system to decide which ads are displayed on its platform, as well as the costs.
Generally, advertisers can expect to pay anything from:
- $0.26 and $0.30 for each click
- $1.01 and $3.00 for every thousand views (CPM)
- $0.00 and $0.25 for each page like
- $0.00 and $5.00 for every app download
There are over 6M active advertisers on Facebook. This is because brands have the opportunity to reach out to over 3 billion monthly users on a platform with a convenient ad system.
Facebook Ads are also cost-effective. According to Wordstream, Facebook’s average cost per click across different industries is $1.72. You can see these statistics in the graph below, along with the Facebook click-through rate (CTR), the average cost per action (CPA), and the average conversion
According to WebFX, Facebook Ads could range from $1.00 to $500.00 per month, as reported by 63% of survey respondents. However, certain companies invest over $3000 per month in their Facebook ad campaigns.
How does the Facebook ad auction system work?
The Facebook Ad auction system works by selecting ads to display. This is decided based on a combination of the advertisers’ bid amounts and the ads’ relevance and quality.
When an ad slot becomes available, the auction determines which ad is most likely to achieve your ad objective at the lowest cost. Then, the winning ad is shown to the target audience. Facebook charges advertisers the minimum amount required to win the auction, and not necessarily their maximum bid.
Factors influencing Facebook ads cost
1. Ad quality and relevance
Facebook Ad cost is largely influenced by the quality of your ad and its relevance to your audience. The ad quality is assessed based on factors like audience targeting, placement, visuals, and text. While the ad relevance is measured by the audience’s positive and negative reactions (likes, clicks, comments, etc). High engagement leads to a higher relevance score, which can lower ad costs, and vice versa.
Learn about the anatomy of Facebook Ads here.
2. Audience
Your target audience can also affect the cost of the ads. Who you target and how many advertisers are also targeting the same group are factors directly linked to the cost of your ads.
Don’t target an overly broad audience without using filters. This could be fruitless since your ad’s relevance is low and you will pay higher ad costs.
Check these useful integrations to automate your work.
Learn all you need to know about Facebook Custom Audiences here.
3. Bidding for ads
As an advertiser, you can set a bid (manual bid) based on the amount of money you are willing to pay for the ad. Facebook also helps to calculate the bid (automatic bid) according to the budget you set.
The bidding system allows Facebook to select the ad with the best quality and relevance and estimated action rates.
4. Ad placement
When creating your ads, Facebook allows you to choose different places you want to run your ads. These include Facebook desktop news feed, Facebook desktop right column, Audience network, messenger, mobile newsfeed, and Instagram. Test out these options to discover the best place that is cheap to run your ads.
Facebook also helps you select the best placement for your campaign using machine learning.
5. Ad Objective
Facebook provides different objectives for advertisers, including awareness, consideration, and conversion. Any of these objectives are achieved at a different cost.
Strategies to reduce Facebook Ads cost
1. Target the right audience
Your ad costs on Facebook are affected by your target audience. As a rule of thumb, a broad audience is likely to lead to lower returns. Facebook lets you define specific audience categories: the general target audience (based on demographic filters) and the custom audience (people who have previously interacted with your business).
There are also lookalike audiences, which you can create from existing audiences of people similar to your audience who have not interacted with your brand yet.
When you target a specific audience, you will reduce competition from other advertisers who will likely target the same audience. This will also reduce your advertising costs.
2. Use the best ad creatives
Facebook is a visual platform and thrives on images and videos. Accordingly, you need to test your creative quality using Facebook’s analytics and average CTR to see if they perform well. For instance, a low click-through rate might be an indication that you need to revise your creatives.
To optimize Facebook ad creatives:
- Know which objectives and options don’t suit asset customization.
- Review ad placements on Facebook’s family of apps and services.
- Customize your ad for these placements in the Meta Ads Manager by choosing your ad’s objective, adding media, and adjusting the image’s aspect ratio and focal point for different placements.
- Use automatic optimizations to enhance your ad for your audience.
Here are 5 ways to create the perfect Facebook ad creative.
3. Use the right type of ads
There are different ad formats and ad objectives on Facebook. Each ad type has its specific goals. For instance, if you need to generate leads for your business at low costs, lead generation ads such as Facebook Leads Ads would work best.
Remember, your ad’s format is also going to influence both the performance and cost of the ads. Check out these best Facebook Lead Ads CRM integrations for your marketing campaigns.
4. Use Video ads
Using videos in your ads also helps reduce advertising costs when running Facebook ads. Videos generate larger impression shares than other forms of content. This is why they have a cheaper cost per click. Usually, videos are cheaper and deliver a better ROI compared to images.
Here is an example of a good Facebook video ad from Try The World.
Images are also valuable in creating engaging ads. However, if you have been paying too much for your ads, you can try using videos to reduce the cost per click.
On the upside, here’s how you can increase ROAS on Facebook Ads.
5. Improve your ad quality and relevance score
If users engage with your ads by liking, commenting, and sharing, it means it resonates with them, and as a result, your ad costs drop. Additionally, you need to improve your relevance score to get at least 8-10 to lower your CPC. (see ‘Factors influencing Facebook ads cost).
Instagram ads cost in 2024
Instagram is the second most downloaded app in the world and no company can afford to miss out on this potential mass exposure.
There are different Instagram ad formats, such as photo ads, video ads, story ads, carousel ads, collection ads, explore ads, and Instagram shopping ads. While being a classic favorite, Instagram’s recent updates are even making it more accessible.
Instagram’s Creator Marketplace is expanding to include Canada, Australia, New Zealand, the UK, Japan, India, and Brazil, with a special invite to Chinese export brands.
They’re also improving brand-creator matchmaking in the US using smarter, machine learning-driven recommendations. This platform’s new focus is on streamlining collaborations, particularly for partnership ads.
But before we break down how Instagram ad auctions work, let’s take a look at a few different types of ads.
Types of Instagram ads
Courtesy of HootSuite, here are three examples of popular photo, story, and carousel ads from Instagram.
Here’s an Instagram photo ad example from Thursdays:
Instagram Story ad example from Campbell’s Canada:
Instagram Carousel ad example from Bash Paris:
How does Instagram ads auction work?
The Instagram ads auction has a single job: To decide which ads to show based on the bid amount, ad relevance, and calculated action rates. Basically, your ads compete in this auction, and the system selects the one most likely to achieve the advertiser’s goals at the lowest cost.
This system focuses on showing ads to users that they find most relevant to them. On the other hand, advertisers get value for their spending by targeting an interested audience.
How can machine learning help reduce Instagram ad costs?
Machine learning helps optimize Instagram ad costs. It can analyze massive amounts of data in just seconds to identify patterns and insights. Then, this data allows you to have more targeted and effective ad placements. This report is essentially predicting which users are most likely to engage with an ad.
This way, Instagram ensures ads are shown to those with the highest likelihood of taking the desired action. And that’s how it improves the ad’s relevance score and helps pay less for more meaningful interactions.
Factors influencing Instagram ads cost in 2024
1. The bid
Instagram ads’ display works via the auction system, so all advertisers have to bid for each ad. There are two bidding systems – manual and automatic.
When using the manual bid, advertisers can select a maximum amount they are ready to spend to get the desired outcome. While in the automatic bid, Instagram will choose how to spend the ad budget.
The amount you bid on each ad influences your Instagram ad costs. Your overall budget will also affect the amount you can bid, which also influences your Instagram ad costs.
2. Ad quality and relevance
Instagram ad quality and relevance depend on user reactions. This is determined by factors like negative and positive feedback and past activities. Overall, low ad scores result in increased ad costs.
3. Estimated action rates
Instagram promotes ads that get more engagement and interaction from users. The higher the engagement rates, the lower the ad costs. Additionally, working to increase your ad engagement brings more leads and conversions to your business.
4. Competition in audience targeting
Generally, ads that target popular audiences will be more expensive. This is because many other ads are targeting the same audience at the same time, which implies that the ads require a higher bid to win.
5. The month and day of the week
Instagram usually gets more traffic when there are holidays and events such as the Super Bowl, Black Friday, Thanksgiving, Christmas, etc. This means a higher number of advertisers invest in ads during holidays to get more sales. Consequently, Instagram ad costs are higher during these times.
Also, it is cheaper to advertise in the first and second quarters of the year than in the third and fourth quarters. The engagement levels are also higher during the week than on weekends. Therefore, ads are more expensive on Tuesdays and Wednesdays compared to other days.
Let’s have a look at Instagram’s average CPC in the past year:
6. Gender and age
The gender and age of your target audience on Instagram also affect the ad cost. For example, there are more men than women on Instagram. Statistics show that 51% of users are males and 49% of females. In contrast, the costs are higher to advertise to users aged 25 – 34, than those aged 18 – 24.
It’s cheaper to target men than women on this platform. The reason is that CPC is higher for females than males. The age of users also affects Instagram ad costs.
It is more expensive to target the age range of 25-34 than other age ranges for their higher purchasing power. Based on the same logic, the age range between 13-17 and 45-64 is cheaper to target.
7. The ad placement
Instagram provides different places to show your ads. They include the mobile feed, right column, desktop feed, audience network, and stories bar- each class has a different ad cost. The right column is expensive, while the feed and story ads are cheaper.
Strategies to reduce your Instagram ads cost in 2024
1. Test different ad formats
Instagram offers different ad formats to choose from, such as photo ads, video ads, story ads, and Instagram shopping ads. Test each of these formats to know what works best for your campaign. However, one of the cheapest ad formats on Instagram is the Story ad. Here is a great example of the Instagram story ads from Babel.
Instagram story ads have a low cost per click (CPC) compared to the mobile feed format. It also has the highest level of engagement.
If you are in the real estate business, learn more about Instagram stories here. Here is our popular integration which you can use for free:
2. Test your creatives
Instagram ads’ creativity is another element that influences ad cost. By testing your creatives, you can improve your ad performance and relevance scores by creating relevant ad content for your audience. So, make sure to test your messaging, images, and other creatives.
3. Use automatic bidding
If you are new to Instagram advertising, start with automatic bidding to avoid overbidding or underbidding. This way, Meta can bid on your behalf for an optimized ad cost and performance. All you need is to specify the overall budget and let Meta’s algorithm do the rest.
4. Use the right audience targeting
For Instagram ads to be successful, they need to reach an audience who is interested in the advertised product or service. Instagram provides different ways to target your audiences based on demographics.
Alternatively, you can create custom audiences and lookalike audiences to target people with higher intent. A more precise targeting improves your ad’s relevance, which will get a higher ad rank. And that means a lower CPC and increased conversions.
5. Use dedicated landing pages
Adding a link to a dedicated landing page in Instagram ads is a must. When clicked, users are directed from the ad to these pages. This encourages engagement and lowers your ad costs. For instance, if promoting a fashion bag, the ad link should lead directly to the bag’s product page, not the homepage or other products.
Additionally, mobile-responsive landing pages perform better. They capture lead information like their name, email address, and whether or not they’re an existing customer.
Find out more about how to build email lists on Facebook and Instagram here.
LinkedIn ads cost
With nearly 1 billion active users, LinkedIn is one of the best social media platforms to advertise. LinkedIn was initially known to be for executives. Now, it offers marketers advertising opportunities, making it potentially the best platform for B2B marketers.
Generally, 70% of brands trust this platform, perhaps for its business-oriented user base.
Types of LinkedIn ads
LinkedIn offers various ad types you can use based on your ad objective and target audiences:
- Sponsored content shows up in feeds as native ads with options that include: single image ads, video ads, carousel ads, event ads, document ads, and thought leader ads.
- Sponsored Messaging directly targets members in their inboxes. They range from Message ads to Conversation ads with multiple CTA options.
- Dynamic Ads are personalized ads on the right rail of LinkedIn. They use member details like photo and job title, including Follower, Spotlight, and Sponsored Ads.
- Text Ads are PPC ads displayed at the top and right-hand side of LinkedIn’s desktop feed. These are ideal for lead generation on a budget.
- Lead Gen Forms enable you to collect information from potential leads through pre-filled forms that are attached to sponsored messaging or content campaigns.
Here are a few examples of some of the most popular sponsored content ads below:
How much do LinkedIn ads cost?
LinkedIn uses a similar pricing mechanism to Facebook and Google with some twists. LinkedIn ad costs vary but you can set your own budgets. Usually, the minimum daily budget for most ad types is around $10.
The Cost Per Click (CPC) for LinkedIn Ads can range from $2 to $15. Similarly, the Cost Per Mille (CPM), or the cost per 1000 impressions, can start from $30 to over $200. These numbers show the competitive and dynamic nature of LinkedIn’s advertising platform.
These prices are not definitive; some factors can either increase or reduce your LinkedIn ads cost. But first, let’s see how the LinkedIn ads auction works.
How does LinkedIn ads auction work?
LinkedIn ad costs are calculated by an auction system that permits you to place bids for your ads and win a placement. The auction system determines which sponsored updates are shown in the feed and how much the advertiser will pay for the impression or click. The auction runs every time a user visits LinkedIn and scrolls through their feed.
LinkedIn reruns the ads through the second auction to compete with other advertisers with a similar target audience. The ad that wins the auction for the audience is displayed to LinkedIn users.
Now, let’s discuss the factors affecting the LinkedIn ads cost.
Factors influencing LinkedIn ads cost
1. Target audience
On LinkedIn, your ad enters an auction where it competes with others who are targeting a similar audience. This competition is based on the ad format.
The platform considers your bid price and the ad’s relevancy score to determine your ad’s overall score. Winning the auction means having the highest overall score (including the highest bid).
LinkedIn uses a second-price auction system, so the winning bid pays just $0.01 more than the second-highest bid.
Now, let’s discuss the factors affecting LinkedIn ad costs.
Factors influencing LinkedIn ads cost
1. Target audience
The selected target audience influences your ad costs. Each time you place your ads on LinkedIn, you compete with other advertisers who are using the same audience. The more popular the audience, the higher the competition and price.
Using the LinkedIn Matched Audiences feature, you can target your audience based on locations, audience attributes (company, job experience, demographics, etc), and custom audiences.
2. The bidding strategy
The bid is the amount of money you are ready to pay for showing your ad to your target audience on LinkedIn. LinkedIn has three major bidding strategies that can influence the cost of your ads, including:
- Maximum delivery automates bidding to keep your ad competitive while using your entire budget effectively.
- Target cost lets you set a target cost per key result via automated bidding to balance spending with campaign performance.
- Manual Bidding gives you control over your bid amount. This also allows you to specify exactly what you’re willing to pay in the auction.
These bidding strategies will affect ad costs. Also, if you win the auction, LinkedIn will make you pay a cent higher than the next highest bidder, hence called the second auction model. However, there is no way to exceed your budget set for the ad’s bid amount.
3. Ad relevance score
LinkedIn’s relevance score for ads depends on their quality, relevance, and audience engagement (clicks, likes, and shares). Higher engagement improves the score, which also boosts your ad’s competitiveness and potentially lowers the costs.
Conversely, low engagement results in a lower relevance score, and increases the ad costs.
4. The objective
LinkedIn offers three key objectives for advertisers: awareness, consideration, and conversion. Each objective uses different optimization goals and bidding strategies to determine your LinkedIn ads cost.
Additionally, each of them is charged using a different pricing model. For instance, brand awareness is charged based on impressions, and lead generation objective (conversion) is charged based on clicks.
Strategies to reduce your LinkedIn ads cost
1. Select the right bid strategy
There are three bidding strategies for a LinkedIn ad campaign. They are the maximum bid, target cost bid, and manual bid. Choosing the right bid strategy on LinkedIn can reduce advertising costs dramatically.
To have control over your CPC, you need to avoid using the automated bid strategy since it raises your cost per click. Therefore, the target cost bid strategy is the best way to handle your ad spending while maximizing your results.
2. Use LinkedIn Lead Gen forms
LinkedIn Lead Gen Form is one of the best advertising tools that help reduce LinkedIn ad costs. These ads include pre-filled forms incorporated into them. Once users click on the ad, the form already contains their personal information derived from their LinkedIn profiles. All they have to do is to confirm and submit the form.
Marketers can add LinkedIn Lead Gen Forms to sponsored content campaigns and InMail, and also help reduce their overall spend.
Here is an example of a LinkedIn Lead Gen Form.
Read this guide to learn everything you need to know on LinkedIn Lead Gen Forms here.
To optimize your LinkedIn campaigns, automating the process is the key. Check out our top LinkedIn Lead generation form integrations below. Remember that you can sign up for one of these integrations for free.
3. Improve the ad relevance score
The LinkedIn ad relevance score is based on your ad’s content relevance and how it compares to similar campaigns. Engagement metrics like click-throughs and social interactions actually tell LinkedIn how your audience perceives your content. A high relevance score (showing strong audience approval) can lead to lower ad costs and vice versa.
4. Use retargeting
Retargeting is a tactic that can help you reach people similar to your existing audience. This system uses a code snippet to track people who have visited your website to retarget them with ads.
Did you know that retargeting ads increase trademark search behavior by 1,046%? Also, the click-through rates are 10 times higher in retargeting ads than in standard ads.
LinkedIn made retargeting possible with the aid of LinkedIn Matched Audiences. This tool helps retarget your website visitors. This way, you can promote your products and services from your CRM or other marketing automation platforms. It also enables you to reach decision-makers at target companies with the account-based targeting feature.
Need better tracking metrics? Here’s how to boost your data tracking by setting up a LinkedIn Insight Tag.
5. Use LinkedIn metrics
LinkedIn provides key metrics to help advertisers track the performance of their campaigns. You can access this information at the top of the “Campaign Manager”, and right under the “Performance Chart” and “Demographics”, as shown below.
LinkedIn reveals your campaign’s metrics so you can see its potential and how to optimize its performance. These metrics include data about high-converting audiences, average CTR, reactions, comments, shares, follows, likes, clicks, and more.
Use this information to evaluate the performance of your ads by improving your relevance score. Ultimately, this helps reduce the cost per click and cost per lead.
Pinterest Ads cost in 2024
Pinterest Ads costs are decided by an auction system. This is to say there is no fixed price. You set a maximum bid for your campaign goal. This could be engagement, clicks, or impressions. Like other ads, the audience you target and the format you use also affects your ads’ cost.
On average, CPM for Pinterest Ads is around $2-$5 per 1,000 impressions, and clicks can cost between 10¢ to $1.50. Prices also fluctuate based on factors like Pinterest’s pricing model and market dynamics.
Your best bet is to optimize your campaign through strategic targeting, ad formats, and ongoing campaign tracking to manage your costs.
Pinterest offers various ad types, including:
- Standard Pins are promoted versions of regular pins, labeled “Promoted by.”
- Video Pins are short, eye-catching videos that can convey more information.
- Carousel Pins consist of multiple images within a single ad, allowing users to swipe through.
- Shopping Pins enable users to make direct purchases from the Pinterest app or an external site.
- Collections Ads feature one large image or video with three smaller images below. These images expand into a full-screen display of up to 24 items on mobile.
How Pinterest Ad delivery works
Pinterest ad delivery also runs on an auction system where you can bid to show your ads to users. Ads are selected (and shown to users) based on factors like bid amount, ad relevance, and user engagement.
You’ll first set a budget and choose between different bidding strategies to optimize your ad spend for an outcome (like clicks or impressions). The system then aims to balance the needs of both advertisers and Pinterest users so that the ads are relevant and engaging to the audience.
Factors affecting Pinterest Ads cost in 2024
Optimized Pinterest Ads result in higher engagement while also having more efficient spending and potentially lower costs over time.
- Specificity of target audience
The more specific and narrower targeting can lead to higher costs due to increased competition for a specific demographic. At the same time, this will increase the engagement your ad can have, which will decrease the costs. Given that your campaign is perfectly optimized.
- The Ad’s format and creatives
Different ad formats (e.g., video vs. standard pins) as well as the creative quality are huge factors in your Pinterest ad costs. This is because they affect engagement and, consequently, cost.
- Seasonality and demand
Like other advertising platforms, Pinterest ads costs can change based on the time of year with peak seasons seeing higher ad costs. Other times these price fluctuations are caused by a trend or a product’s popularity which will increase the demand and hence the costs.
- Bid strategy and budget
The choice you make between automated and manual bidding strategies can impact how efficiently your budget is spent.
- Ad performance
The higher your ad’s engagement rates are the better your ad relevance scores. This can potentially reduce cost per action over time.
How to reduce Pinterest Ads costs in 2024
Now let’s talk about some action-based strategies to reduce Pinterest Ads costs and win over the competition in 2024:
- Optimize your audience targeting
Better ad targeting means focusing on a narrow audience. This might be specific demographics, interests, and behaviors to reach the most relevant audience. In addition to cutting down on wasted impressions, you’ll increase your ad’s effectiveness and reduce costs.
- Optimizing your ad’s creative
Creating engaging, high-quality visuals and copy that resonate with your target audience is a sure strategy. Test different creative elements to see what gets the best performance at the lowest cost.
- Selecting the right ad format
Using an ad format (e.g., standard pins, video pins, carousel ads) is a Pinterest best practice that’s often overlooked. The right ad format matches your audience’s expectations while delivering your message. Creating a relevant and engaging ad naturally becomes the most cost-effective option for your campaign goals.
Check out this complete guide to Pinterest Lead Ads.
- Analyze your ad’s performance
Regularly review your performance metrics to find out which one of your ads is underperforming. The weak performance might also be in the targeting criteria. After pinpointing the issue, adjust or pause these parts to move your budget towards higher-performing options.
- Leverage Automated Bidding
Pinterest’s automated bidding strategies can take a lot off your hands. It basically optimizes your campaign for the best possible results within your budget constraints. This option can also help manage costs by focusing on achieving specific objectives, like conversions or engagement.
Want to put your campaigns on autopilot? Build your integrations now:
Types of ad costs by channel
Advertising costs can vary greatly depending on the channel you choose. Let’s take a look at some of the most popular advertising channels.
Pay-per-click (PPC) advertising
PPC advertising means you pay every time a consumer clicks on your advertisement. This advertising channel can be as inexpensive as a few cents or cost upwards of hundreds of dollars per ad. According to WebFx, the average cost per click (CPC) is $1-$2, amounting to a monthly PPC strategy between $9,000 and $10,000 (for medium-sized businesses).
Social media advertising
Social media advertising varies depending on how marketers use the channel. Here’s how much social media advertising costs in 2024:
Professional social media advertising management services can range between $850 to $2,750 per month, but when you factor in the cost of hiring professionals, operating across several platforms, and technology costs, monthly social media advertising costs can reach as high as $6,000 per month.
Search engine optimization (SEO)
SEO is the process of improving your website with the use of keywords and phrases so that your website ranks higher in search engine results. An SEO optimized website can generate more traffic and potentially more sales.
One of the pillars of an effective SEO strategy is organic lead generation. However, it requires you to hire an SEO agency, which can cost between $750 and $2,000 per month. Alternatively, you can build an in-house team, which could cost even more.
Email marketing
Despite email marketing being one of the oldest channels, it is still proven to have the highest ROI. Operating your email marketing campaign in-house can cost between $9 to $1000 per month (per campaign). If you hire an outside agency, the costs will range between $300 and $1500 per month.
Content marketing
Content marketing is simply the creation of original content on your website such as a blog or white paper. This channel can be very cost-friendly if you produce the content yourself. However, hiring an outside agency costs even a small business. It can range between $2,000 and $10,000 every month.
How much is advertising for a small business
The monthly online advertising costs for small businesses depend on the industry and how much work marketers want to get done in-house compared to hiring an outside agency.
On average, small businesses spend $2500 to $12,000 on online advertising per month. The use of online advertising is only projected to increase for small businesses in the future.
Final thoughts
We discussed the advertising costs on the seven major platforms: TikTok, Google, YouTube, Facebook, Instagram, LinkedIn, and Pinterest. Since many factors influence ad costs, there is no fixed price for advertising on the platforms.
These factors include the ad quality and relevance score, niche industry, target audience, bidding strategies, etc. However, a combination of these elements determines how much your ads will cost you.
The good news is that there are ways to reduce your advertising costs, such as increasing the quality and relevance of your ads, using the right ad format and bid strategy, targeting the right audience, and testing different ad creatives.
Using the right tools, such as LeadsBridge automation integrations can also optimize your ads and ultimately reduce your advertising costs.
Discover all LeadsBridge integrations here.
