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LinkedIn Ads: How To Create A Lead Generation Funnel

Creating a lead generation funnel through LinkedIn advertising.

When I first started running paid social campaigns, I became familiar with the concept of lead generation (or marketing) funnels. The concept is extremely popular in retail, eCommerce, and B2C advertising on platforms like Facebook and Instagram, but the same concept can be applied on LinkedIn.

Instead of launching one campaign to generate conversions, you launch three campaigns. Each campaign is a step in the marketing funnel, designed to capture the attention of the right people, generate interest in your product or service, and nurture these people until they are ready to contact you.

Ultimately, the resulting ad experience is more relevant and engaging. This approach is more cost effective than trying to sell straight to a cold audience. All of your advertising costs (daily budgets, monthly budgets, maximum cost-per-click) can be tiered for each step in the funnel.

While I intend for this article to help you create a segmented marketing funnel for LinkedIn advertising, if you've never launched an ad campaign on LinkedIn, you might find this article helpful for familiarizing yourself with the full scope of LinkedIn advertising options.

Here's how to create and launch your own LinkedIn lead generation funnel so you can start seeing better success through LinkedIn advertising.

Defining The Three Key Funnel Stages

First, let’s group our target audiences into the three funnel stages and define each one:

  1. Cold: These are people who need to be introduced to your company. They’re “cold.” They’re at the “top of the funnel.” They might have a problem you can solve, they might not. The goal is to get out in front of these people, show them how you help businesses with a particular need, and attract interested parties to your website.

  2. Warm: These are people who have been to your website and browsed your product/service pages. They’re in the “middle of the funnel.” They might not have a strong purchase intent just yet, so it’s important to get in front of them again with educational content like whitepapers, guides, tip sheets, etc. They still need a little more context, a little more nurturing.

  3. Hot: These are people who have downloaded your content. They’re plenty warmed up, and, presumably, ready to talk to a sales person or schedule a demo or a consultation. The goal of this campaign is to put that path in front of them with action-oriented ads that speak directly to their purchase intent (“contact us for a consultation,” “schedule your demo,” “get in touch with a sales person”).

Now that we’ve properly defined each audience, let’s break each one down in terms of LinkedIn targeting options.

Configuring Cold Audience Targeting

There are three types of cold audiences available to you:

  1. Creating an audience using LinkedIn’s audience attributes like job titles, industries, skills, member groups, etc.

  2. Creating a Lookalike audience from a list of existing and past customers.

  3. Creating a list of target accounts (consider this an account based marketing approach).

Any of the audiences above will make for good cold audience candidates. Typically, I favor Lookalike and target accounts over using LinkedIn’s provided attributes. I usually find the provided industries not to be refined enough for detailed targeting. How do you create these cold audiences? Once inside a campaign, in the ‘Who is your target audience?’ section, you have the option of creating an audience using ‘audience attributes’ or ‘matched audiences.’

Targeting by audience attributes when launching LinkedIn campaigns.

In order to create an audience using attributes, simply click into that section and begin putting together an audience that best matches your target customers.

In order to target a lookalike audience or list of target accounts, you must click into the ‘matched audiences’ section and upload a list of customers to use as a lookalike base.

Creating a lookalike audience for launching a LinkedIn advertising campaign.

There will be a set of best practices available on this screen to help you format your list correctly.

Once the customer list is matched to people on LinkedIn, you can create a Lookalike audience. Typically, LinkedIn will take 24-48 hours to match an audience list you upload to actual LinkedIn users.

Configuring Warm & Hot Audience Targeting

This next set of audiences is the easiest one to create. They will, however, take some time to acquire enough in-platform users (around 300-400+) to start serving in your campaigns. These audiences can be created under Account Assets > Matched Audiences in your LinkedIn campaign manager.

Simply click on ‘Create Audience’ on the right, choose ‘Website,’ and input your URLs to track Website Visitors (generally, this will be your main website URL) and conversions (generally, these will be thank you pages that signal a successful download or contact request).

You will also want to be sure to set up the proper conversion actions in your campaign manager (Account Assets > Conversions).

Visualizing The Lead Generation Funnel

Now that we’ve defined our audiences and discussed how to create them in LinkedIn, let’s try to visualize how these components work together.

When talking about targeting options, we also have to discuss exclusion options, since you want to make certain that you are properly moving people through the funnel. Below is a table I create when coming up with campaign funnels. I break down the different stages of the funnel, audience targets, audience exclusions, daily and monthly budgets, and creative options for each funnel stages.

Template for creating a LinkedIn lead generation funnel.

A note on budgets: When it comes to daily and monthly budgets, I try to spend 70% of the total budget on the cold audience to get the funnel working. There are all kinds of exceptions to this rule. Maybe 100% of the budget is spent on the cold audience in month 1 in order to get enough users into the funnel before turning on the warm and hot campaigns.

The table above is for planning purposes. It's designed to be a work in progress. After I load audiences in an actual campaign, LinkedIn will tell me what the audience size is and how much I can expect to spend. When I decide on a bidding strategy, LinkedIn will tell me what the average CPCs are. These data points will give me a more realistic set of expectations for monthly spend. I typically replace my initial numbers with platform numbers and continue to adjust expectations as campaigns roll out.

Selecting Campaign Objectives, Ad Formats & Bid Strategies

For each campaign you launch, you'll want to choose the right objective for that campaign. It's pretty simple: cold campaigns should have the "website visits" objective, while warm and hot campaigns should have the "website conversions" objective.

When it comes to ad formats, I either choose single image ads or carousel ads. If you have a compelling video, you'll want to use a video ad. Other ad types like text ads, spotlight ads, and message ads may be worth exploring once the funnel is full-on working and generating conversions.

After you've chosen an objective, created your audience, and picked an ad format, you will have to decide on a bid strategy. I find that most paid social managers are very particular about which bid strategy they use: automated bidding or enhanced CPC bidding. This article from LinkedIn on choosing the right bid strategy for your budget is extremely helpful if you're looking for a detailed explanation on which bid strategy may be best for you. But, in short, if you're looking to spend your full budget and get results fast, automated bidding is the way to go. If you're looking to control your budget, and get as many clicks for the lowest cost possible, enhanced CPC bidding will be your best bet.

Is The Effort Really Worth It?

Have you ever gotten a cold sales message on LinkedIn? I’ve sent them. I receive them. They are not effective. Many times, the people receiving these messages are not even in the market for your product or service. If they had somehow opted into the message in the first place (if they had been part of a funnel, for example), then maybe the message would have been more successful. Building a LinkedIn lead generation funnel allows you to build interest in your company, products, and services, without forcing “sales-y” ads in front of people who have never even heard of you. But, a funnel is not a fast track. It helps you create powerful touchpoints with potential customers, providing them value at each step, and helping them “convert” when they are good and ready.

When you create a successful LinkedIn funnel, that funnel tends to look something like the one below:

The cold campaigns above were designed to introduce audiences to a company through blog articles. After those users visited those articles, they were retargeted with a downloadable offer. The cost per click and cost per conversion numbers are extremely competitive. These kinds of results are not out of reach for any business. I have been able to achieve them again and again by adhering to the approach I outlined above.

If you are a business selling to other businesses and you're having trouble finding the right audience through Google Ads, or you are looking to diversify your paid lead generation spend on other platforms, creating a LinkedIn lead generation funnel is a much better investment for your money than launching one-off campaigns selling to cold audiences.


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