Fully 80% of B2B leads come through LinkedIn, but users spend just 6.5 minutes on the site daily. Many businesses consider LinkedIn Ads for tapping into their audience on this career-focused platform. After all, LinkedIn Ads offers sophisticated B2B targeting at scale.

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On the other hand, advertising on LinkedIn costs more than on other social networks, so marketers shouldn't dive in without a well-considered strategy. For the right marketing organization, however, LinkedIn Ads pay off.

I invited Linkedin Ads expert AJ Wilcox to Marketing Smarts to discuss how you can build the foundation for effective LinkedIn Ads and generate valuable leads for your sales team. We talk about the anatomy of an ideal advertiser on LinkedIn, how to use LinkedIn Ads targeting to reach your ideal prospect, the upside and downside of each ad format, and more.

AJ is globally recognized as a top LinkedIn Ads expert. He speaks, trains, presents, and manages advertising campaigns for executives and teams around the world. His agency, B2Linked, specializes in account management and consulting with regard to LinkedIn Ads.

Here are a few highlights from our conversation.

LinkedIn Ads aren't cheap (but they are effective) (07:20): "Most people are attracted to LinkedIn because of the targeting. They know they can hit exactly the right person when they need to. And quite a few companies are telling me, 'Yeah, we know the 3,000 people around the globe who would be our idea customer, we don't want to spend money on anyone outside of that small group.' LinkedIn's going to be really, really good for that because you can target by job title and all that.

"Where the challenge comes in is, because the cost is high, it means LinkedIn has priced itself out of the market for certain types of businesses. If you're trying to do business-to-business lead gen and you have a customer lifetime value or deal size that's greater than about $15,000, then LinkedIn Advertising is an absolute no-brainer. You'll hit it out of the park every time. Some people are making it work on less than that, but just realize that because it's expensive on the front end you need a bigger payoff on the back end to make sure you get a high ROI."

LinkedIn Ads might not be right for your company, but you can still use LinkedIn for marketing (08:24): "[Smaller companies could] do some great things on the organic side [of LinkedIn] because the search functions are so strong. If you can't afford ads, there's nothing stopping you from finding exactly the right people, searching them by job title or company name, then reaching out and trying to start a relationship. Obviously, don't approach them with a sales conversation right up front, but think long-term, think building a relationship. That will turn into plenty of sales conversations down the road. You just have to be a little more patient." 

Use language that tells LinkedIn users your content is valuable and snackable (10:47): "There are certain types of assets that feel lower in friction. So if I told you 'download our whitepaper' or 'download our guide,' one of those two things feels more consumable. It feels like less friction to you as a user, so you're probably going to have a higher conversion rate if I say 'guide' rather than 'whitepaper.' Or if I say 'checklist' rather than 'e-book.'

"But, in general, what we've found is if the promise of your content is promising to solve a major pain point or it satisfies a major curiosity or your ideal user, it almost doesn't matter what style or type of media it is. They're after solving that problem.

"So if you can go and talk to your sales team and figure out the two or three problems that everyone's asking about and go create content around that, you promise to solve a pain point for someone, and whether that's a one-page cheat sheet or a 48-page e-book or an hour-long webinar, chances are you're going to have a really high conversion rate either way."

Sponsored InMail pays off, but only if you treat it like a personal invitation (20:27): "The InMail will only come in when you are logged in actively to LinkedIn. They won't notify (users) about it, but the nice thing is you still have, on average, a 50% open rate, which means the majority of people are at least seeing that it landed in their box and they have an opportunity to see it.

"Where the challenge comes in is if your offer isn't special. If your offer is just 'here's another checklist,' 'here's another whitepaper,' 'here's another webinar,' it will feel like spam email and people will ignore it. Now if someone ignores a sponsored InMail, you paid for them to ignore it. And so your cost per click goes way up. But if someone ignores sponsored content, and doesn't click it, you're not out anything.

"What it takes to be really successful with sponsored InMail is an offer that feels like a personal invitation. 'Because of who you are in the industry, we want to give you early access' or a sneak peak, or VIP treatment for something. 'Come and join this free event with your peers.' Those kind of offers all work great. If it would come across in a normal email as spam or not interesting, chances are it's going to be a really expensive cost per conversion as a sponsored InMail. 

To learn more, visit B2Linked.com, and follow AJ on Twitter: @wilcoxaj. You can also download AJ's free checklist on how to start advertising on LinkedIn. Also be sure to check out the MarketingProfs series of courses on demand generation!

AJ and I talked about much more, including the LinkedIn Ads option people need to check immediately to ensure that they're paying only for the clicks they actually want, and how one simple change brought the cost-per-conversion of one LinkedIn Ads campaign down from $127 to $27, so be sure to listen to the entire show, which you can do above, or download the mp3 and listen at your convenience. Of course, you can also subscribe to the Marketing Smarts podcast in iTunes or via RSS and never miss an episode!

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Music credit: Noam Weinstein.