What We Learned From $130M in Spend in A Down Economy
A down economy typically takes no prisoners—which is why we hypothesized that the past twelve months of paid advertising activity would be marked by reduced spend and lower performance metrics.
We were wrong.
Not everything ramped down as expected, at least in B2B.
Metadata customers have spent nearly $130M in advertising over the past year. We thought that economic headwinds would result in lower demand, lower ad cost, and lower conversion rates. Yet successful top-of-funnel efforts are actually cheaper now than pre-April 2022, and overall ad spend is flattening out rather than plunging.
So what’s changed between then and now, and how does it impact where your dollars and attention should be spent in the months ahead? Read on to find out.
Tried and true: Proven paid social tactics
Customer data is king. It helps us cut through the noise and speculation to expose the tactics that work in real life. Just like last year’s 2022 B2B Paid Social Benchmark Report, we analyzed campaign data from each and every customer in the past 12 months.
What this means for you, marketing and demand gen leaders, is frontline insights that will help you optimize and improve your paid social campaigns.
Comparing “pre-recession” 2022 vs. “post-recession” 2023
This year, we’ve taken a different approach to our annual report.
The big event felt by every B2B marketer within the last year was the economy slump. While not a textbook recession, the time period has been the epitome of a down market. So instead of looking at the data by year, we broke it up into two parts: pre- and post-April 2022 economy.
We’ll look at everything from impressions to cost to lead quality and much more, then break it down by channel to reveal the best strategies you can use to run successful campaigns. We’ll also take a look at average spend per customer across Facebook, LinkedIn, and (occasionally) Search.
Note that the benchmarks and insights in this report are based on averages across all Metadata customers. But we’re also opening up access to our raw data set so that you can dig deeper and drill down by industry, annual ad spend, and company size if you’re so inclined.
You’ll also observe a large range in values when it comes to CTR, CPC, and CPL. That’s because our customers work across many different industries, from software to manufacturing to services—each with its own demand model.
LinkedIn vs. Facebook
For many B2B marketers, LinkedIn is the default and fan-favorite channel to run paid social campaigns. But it’s important to acknowledge the many channels your audience members live in, both on and off the clock.
The data we’ve analyzed is telling an interesting story right now, and it’s this: Facebook is taking center stage as a high-performing (and cost-effective) paid channel for B2B marketers.
The numbers paint a new picture today than they did prior to April 2022. And as mentioned above, the picture is mostly a good one, which isn’t what we initially hypothesized.
On LinkedIn, TOFU campaigns are getting cheaper while BOFU campaigns are more expensive. The most notable change is cost-per-opportunity which has dropped on Facebook and risen on LinkedIn (more details below).
There are always compelling reasons to run campaigns on both Facebook and LinkedIn. The path you take will depends on who you are, who your audience is, and the types of campaigns you run.
To double up on good news we didn’t predict, CPC has decreased across platforms in addition to CTR increasing—a trend that spans both lead gen and brand awareness campaigns. On Facebook, CTR has most likely increased due to the rise of ABM and ungated content. Similar to CPC, this is mostly a measure of how interesting your ad/offer is to the people you’ve targeted. For example, you could get a high CTR that doesn’t end up turning into leads, opportunities, or revenue.
The data illustrates another positive trend when it comes to post-April 2022 cost per lead. CPL is down across both LinkedIn and Facebook; combined with lower CPC this means both clicks and leads have become cheaper in the past year. It’s still possible to get a lower CPL that doesn’t lead to revenue. But if you’re using an offer or demo request directly related to your product, and still getting a lower CPL, that’s a good sign.
CPO is where things get interesting. On Facebook, CPO has gotten cheaper starting at $8,071.00 and plummeting to $4,950.64. But LinkedIn CPO has nearly doubled in cost rising from $1,614.14 to $3,162.89. Buyers are still willing to take offers and demos but crossing the finish line because of decreased buying power. The broad takeaway?
Audience matching and intention will undoubtedly become the winning technique. Each channel should be used for different campaign types, ad creative, and goals. For example, CPO and CPL for image ads have been less expensive than Facebook post-April 2022, and CTR is higher for LinkedIn with brand awareness campaigns. Facebook is right at home in the awareness stage while LinkedIn supports deep-funnel messaging.
Tactics and strategies based on the metrics
Now that we’ve outlined where the winds of paid advertising are blowing, it’s time to explore concrete best practices you can use, why they’re working, and how you should implement them.
CTR vs. CPL: Which campaign type performs best?
Companies are now increasing spend per account for CTR campaigns. For example, in April 2021 companies were spending an average of $4,826.79 per month. Today they’re shelling out upwards of $11,000.
In September of 2021, everyone was all in on CPL with spend-per-month averaging $35,000. By July 2022 it peaked at $40K, only to crash in December 2022. It’s clear that companies switched from contact collection mode to brand awareness. There seems to be an effort to leverage owned assets in order to cut costs. Driving traffic to your website and then focusing on retargeting and conversion rate optimization is more effective than cold advertising.
It’s clear that companies are realizing the importance of brand awareness in less-fruitful times. A strong brand can carry you through a drought. It can also give you a boost when money is flowing. It’s difficult to get people comfortable with your brand purely from demand gen campaigns locked in ad platforms.
Yet while CTR went up after April 2022 and CPL went down, not all metrics improved. For example, lead-to-opportunity rates slumped across LinkedIn and Facebook. Our theory? While everyone’s interested in shiny new B2B tools, they simply don’t have the budget to take things further.
If you’re seeking the best bang for your buck, CPO has dropped by a whopping 40% on Facebook. It’s important to note that LinkedIn still wins with a cheaper CPO overall, clocking in at $3,163 per opportunity compared to Facebook’s $4,951.
Which CTAs are getting all the clicks?
Choosing the best CTA can be the difference between a meaningless impression and a promising click. Without a click, your lead isn’t going anywhere anytime soon.
So what are the most clicked CTAs in a post-April 2022 world? We dug into the data to uncover CTA trends based on demand-gen CPL campaigns. While all CTAs are performing better across channels, the cost goes up further down the funnel. We’re also noticing a difference in CTAs that are sales-based (“Get Quote”) and content-based (“Download”).
As potential buyers, we want to stay ‘in the know’ about new tools and platforms. We’re willing to join webinars, read content, and take a product tour. But when it comes time to bust out the wallet, that pain point isn’t as bad as we thought.
On LinkedIn: “Download” reigns supreme
Best-performing CTAs on LinkedIn
“Download” was the most popular LinkedIn CTA in our last benchmark report. It’s still hands-down one of the best-performing in the current economy. The average CTR for “Download” clocks in at .58% versus .53% pre-April-2022, while the average CPL has dropped in cost from $124 to $84. Performance is strong for both top and bottom-funnel campaigns.
Similar to our campaign-type data above, CTAs reflecting gated or lead gen efforts are taking a back seat. CTAs promising valuable content are moving forward.
“Register” comes in a close second on LinkedIn, with an average CTR of .55%. We’ve identified this as a better bet than “Sign Up,” but the two CTAs can be used interchangeably. “Sign Up” has a slightly higher CTR. The average CPL is double that of “Register.”
On Facebook: “Sign up” takes the cake
Best-performing CTAs on Facebook
“Sign Up” currently blows past the performance of other Facebook CTAs with an average CTR of .71%. It also has the second-lowest CPL at $121 on average. It’s a solid CTA choice for top- and bottom-funnel Facebook campaigns.
“Learn More” is your next best bet on Facebook, with a strong .69% CTR and a reasonable $157 CPL.
Try “Get quote” on Facebook and LinkedIn
“Get Quote” may be a new sleeper-hit CTA to test out on both channels. It had remarkably low usage pre-April-2022 but is picking up steam. It does come with a high cost per opportunity across both platforms, averaging $4,630 on Facebook and a whopping $21,378 on LinkedIn.
How does headline reading level affect CTR?
Headlines can be a tricky beast: You need to give enough specificity to entice your customer, but you can’t go overboard. Attention span is a hot commodity. While paid ad headlines range anywhere from a fifth-grade reading level to a college graduate, the sweet spot is different on Facebook and LinkedIn. There are a few anomalies in the data that may favor taking risks when appropriate.
On Facebook, the highest CTR was .71% associated with the college graduate reading level. At first, this might sound counterintuitive when you consider the non-professional culture of Facebook. This isn’t LinkedIn after all. The second place position is a tiebreaker between college students and 8th & 9th grade reading levels. Even though both categories come in at .69%, the number of experiments is much higher in the college bracket.
The takeaway? Don’t be afraid to aim a little higher with your Facebook messaging.
Talk about unpredictable outcomes. The CTR leader for best-performing ads on LinkedIn is the 6th grade reading level boasting 1.31%. Trailing in third place is the professional reading level at 1.03%.
It may be safe to say that professionals on LinkedIn are burned out by traditional B2B jargon and buzzwords. Of course, knowing your audience and product is key, but there are only two real options: Keep it really (really) simple or be the absolute expert in the room.
What kind of ad creative is working?
The down economy pushed creatives to do what they do best—get creative. Marketers were forced to identify the magic mix of channel, audience, and message to earn conversions. We see this taking shape in the data with a notable increase in experiments per customer. LinkedIn experiments are up by 15% and Facebook experiments are up to 6%
Paid ads can be styled as images, videos, carousels, or (on LinkedIn) convos. We view images and video as the “meat and potatoes” of paid ads, but it may be time to give carousel ads a chance on LinkedIn. Companies have more than doubled the amount of experiments, CTR is up .50%, and CPL is virtual cut in half at $249.21.
Another reason to take carousel ads for a spin? Video ads are losing favor. Since April 2022, video ad experiments decreased, CTR has gone down, and CPL has gone up across LinkedIn and Facebook.
What images are working best?
Image ads aren’t going anywhere. On LinkedIn, they’re the cheapest to run which doesn’t hurt. Here are some good best practices to keep in mind when it comes to image ads:
- They drive curiosity
- They use photos of REAL people
- They use stats to back up their point
Use images that drive curiosity
Some say curiosity killed the cat—but we like to say that curiosity got the click. Ad copy is always an essential ingredient but it’s the image that first catches attention and clicks.
Use photos of real people
Ads featuring images of real people perform better than ads with stock imagery. Stock images may be convenient, but they come off as what they are—generic and impersonal. One technique? Consider designing ads that feature a headshot of a subject matter expert or company leader.
Use stats to back up your point
People are more likely to believe statements that are backed up by evidence. As humans, we’re skeptical of new information that’s presented to us—especially in an ad. Combine punchy copy with thought-provoking stats for a winning combo.
Manual vs. automated bidding
After April 2022, CPL went down across the board for manual bid and auto bid campaigns. The key differentiator in determining which works best is CPO.
Manual bid is your best bet on Facebook until you see the average cost per opportunity over $7,000 compared to auto bidding strategies at $2,805—yikes. That’s why we’re on the lookout for deeper/lower KPIs.
On LinkedIn, manual and automated bidding strategies can work. While CPL is down for both campaign types compared to pre-April 2022 days, there’s no clear winner today. Manual bidding has a much lower CPO but auto bidding has a lower CPL and better top-funnel performance.
What about the rest of 2023?
We’re only halfway through 2023—uncharted territory lies ahead. To navigate the next two quarters, we’re making decisions using quantitative and qualitative research.
In addition to the customer data compiled in this report, we collected testimonials and opinions to get a boots-on-the-ground sense of what’s happening in B2B marketing. We asked respondents three questions about the rest of 2023. Here’s what they had to say.
Question 1: Where are you planning to increase marketing spend in 2023?
While many of our customers cited budget belt-tightening and decreased marketing spend, they’re also making strategic bets across video, communities, events, and more.
Mobile engagement platform Vibes plans to increase paid advertising spend to attract more MQLs and leverage outside contractors and agencies. Manager of Demand Generation Ty Seager says the team has seen great results from conferences and events.
Your strategy is an investment that will return a certain degree of impact—you should change it depending on the returns you see.
Question 2: Where are you planning to decrease marketing spend in 2023?
Paid channels will be taking a temporary hit according to customers who cited factors like Facebook’s limited targeting options and low ROAS.
Others are getting more specific on where they trim the marketing fat.
Marketing veteran Chuck Moxley plans to eliminate the “nice to haves” that aren’t driving demand and revenue, such as swag, fancy Martech tools, and trade show budgets. Blue triangle conducted a review of all vendors and software investments to confirm they were contributing to a positive ROI and plans to trim those that didn’t make the cut.
One thing they’re not cutting? Their Metadata budget.
CMO, Global Head of Marketing at Blue Triangle
Question 3: How would you summarize your 2023 marketing plan in three words or less?
We’ll leave you with ten customer responses to inspire your own paid marketing plan in the days to come. The key theme? Strategic and agile iteration.
- More with less
- Pipeline generation
- Fast-paced, maturing, cohesive
- Scale, launch, iterate
- Best be creative
- Target only ICP
- Pivoting through chaos
- Lean, scrappy, smart
- Intimate, targeted events
- Build, fuel, optimize
One thing is clear in the current climate: budgets are slimmer, but the data indicates campaign funds can still be put to good use. Just like a savvy stock market investor who buys the dip, companies who double down on marketing in a recession are best positioned to capture market share and achieve long-term success.
How to look at the benchmark data
- Click-through rate (CTR): CTR is an early indicator of how appealing and relevant your target audience finds your campaign. It’s best to look at this when you’re experimenting with several ads, creative, etc., and want to quickly optimize those with the most initial engagement. A CTR of 0.60% to 1% is considered good.
- Cost-per-click (CPC): CPC is another early indicator of efficiency, and you can use it to compare one campaign against another. You’ll optimize to this metric if you’re running a brand campaign, while you’ll optimize to CPL for lead gen. What we consider to be a good CPC is relative, but for good paid social campaigns with relevant offers, it should be below $10.
- Cost-per-lead (CPL): CPL measures the efficiency of your campaign. How much can you spend to generate a qualified lead and convert that lead to a customer? A good CPL is different for every company and should be based on your unit economics. For example, if my average selling price is $1M vs. $100k, I can likely afford to spend more per lead.
- Cost-per-opportunity (CPO): CPO is another measure of efficiency you can use to start looking at ROI from your marketing. You’ll have a good sense of ROI if you know the opportunity dollar value and your cost per opportunity. A good CPO is different for every company and should be based on your unit economics.
- Channels: We’re reporting on paid ads displayed on both LinkedIn and Facebook, two of the most popular paid channels for demand gen marketers.
