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How the LinkedIn Ads Algorithm Affects Your B2B SaaS Marketing

by 

Lauren O'Bryan

Last updated: July 31st, 2024

While LinkedIn is a highly favored platform for B2B SaaS companies looking to drive high-quality leads, the only way to harness its full potential is by mastering the LinkedIn ads algorithm. After all, it’s the algorithm that dictates ad visibility and engagement, so knowing how to use it to your advantage is paramount.

In this article, we’ll uncover the factors that influence ad placement and performance and give you actionable insights on how to drive better results for your B2B SaaS campaigns.

We’ll also touch on some common mistakes marketers make when developing LinkedIn ads and refresh your memory on all things LinkedIn. Let’s get into it.

LinkedIn Ads: An Overview

LinkedIn has an impressive global reach with around 1 billion members, including direct access to the majority of the world’s Fortune 500 CEOs. This makes it the perfect platform for B2B SaaS companies to promote their brands and gain highly qualified leads.

Whether you plan on expanding your LinkedIn ads in 2024 or are just getting started, the first step is knowing all the available ad options. There are 4 main types of LinkedIn ads:

• Sponsored content appears in the news feed with the label “promoted” and can contain images, videos, or documents.
• Direct messaging ads are sent directly to a user’s inbox, making the communication feel more personalized.
• Dynamic ads are tailored to each user based on their profile details.
• Lead generation forms are prefilled forms designed to get further action from leads closer to the bottom of the funnel.

Choosing the right ad type will depend on your campaign’s goal and the stage of the funnel you’re focusing on.

Developing an ad is quite easy and LinkedIn guides you through the process.

1. Select your ad’s objective, whether to build awareness, drive engagement, or gain conversions.
2. Identify your target audience. Choose a location and narrow the pool down by adding a job title, company name, industry type, or professional interests.
3. Choose an ad format that best aligns with your campaign’s objectives.
4. Include your budget and the duration of your advertising period.

While this is a straightforward process, there’s one last thing you should do to get the maximum impact from your LinkedIn ads – understand how the LinkedIn algorithm works.

Demystifying the LinkedIn Ads Algorithm 2024

LinkedIn works differently from platforms like Instagram and Facebook. The main difference is that content isn’t designed to go viral. Instead, LinkedIn aims to show content to users based on their industry and interests, helping them find relevant professional information and expertise. So, how does the algorithm do this?

LinkedIn uses three sets of criteria to determine the most suitable target audience for a piece of content:

• Identity: Connections that are closer to your network are more likely to see your content.
• Content: The relevance and topic of your content help decide the most appropriate target audience.
• Member activity: Members who frequently engage with content on a specific topic are more likely to receive more of that topic.

When developing content for LinkedIn, consider how effective it will be at encouraging users to engage. You want to drive meaningful engagement and comments, and posting quality content is a great starting point.

Is it Quality Content?

When you develop an ad or piece of content, LinkedIn will establish whether or not it’s spam. According to LinkedIn, there’s spam and quality content.

Spam content is considered chain letters, polls, or requests for likes, shares, or reactions that might artificially boost engagement. It also includes excessive irrelevant comments or messages. Quality content, on the other hand, avoids these spammy tactics and provides meaningful, relevant information.

One important factor to note is that the LinkedIn algorithm frowns upon external links. The platform prefers to keep users engaged within LinkedIn rather than direct them elsewhere. While it’s not a hard and fast rule to completely exclude external links, minimizing their use can help improve the visibility of your content.

Who’s Engaging?

Engagement is a high-ranking factor determining content quality on social media platforms. That said, LinkedIn values meaningful engagement over mere post interactions by analyzing the relevance of connections and whether the interactions involve thoughtful comments and insightful discussions.

How Active Are You and Your Network?

LinkedIn rewards users who are active on the platform. Therefore, to boost the visibility of your content, regularly post and engage with other people’s posts by contributing thoughtful comments with substance.

By considering these factors, LinkedIn gathers enough data on you and your network to deliver your ads to the right target audience.

Common Issues B2B SaaS Companies Have with LinkedIn Ads

Many B2B SaaS companies are not using LinkedIn ads to their full potential. While it’s a common perception that LinkedIn ads are too expensive and ineffective, the reality is that many ads aren’t working due to the following common mistakes companies make:

1. Inability to budget correctly: LinkedIn ads are more expensive than ads on other advertising platforms. So, to achieve good results, it’s necessary to increase your ad spend. Many companies struggle with this adjustment and fail to budget appropriately for LinkedIn’s cost structure.
2. Poor ad targeting: LinkedIn already filters who sees your ads based on industry relevance, so don’t narrow down your target audience too much. Being too specific in ad targeting will result in ineffective ad visibility overall. It’s important to strike a balance to ensure your ads reach a broad yet relevant audience.
3. Not developing the right fit content: Researching your target audience, understanding their motivations, and identifying their pain points are crucial steps before creating content. Only by creatively crafting content that resonates with your different audience segments and addresses their specific questions and concerns can you ensure maximum effect.

How to Navigate the LinkedIn Ads Algorithm in 2024

Understanding how the LinkedIn ads algorithm works is just the first step. To maximize your results, follow these six strategies:

1. Create relevant content that displays your expertise. Conduct thorough research on your buyer personas so you can develop audience-relevant and valuable content. Keep the content authentic and in line with your brand and professional experience. Take note: thought leadership content is highly valued on LinkedIn.
2. Target specific audience segments. After researching your target audience, create ad campaigns tailored to each segment. Don’t try to target everyone with the same content, as tailoring your ads to particular groups increases relevance and effectiveness.
3. Schedule ads at optimal times. Timing is important on social media platforms. LinkedIn is a professional platform, so users are most active during standard working hours. One study found that the best times for post-engagement are around midday on Tuesday, Wednesday, and Thursday.
4. Build a network of industry-relevant connections. Because LinkedIn prioritizes showing your ads and content to your immediate network, it’s really important to thoughtfully build your connections on LinkedIn. Focus on connecting with individuals who align with your industry and target audience. This can also be of benefit when creating thought leadership content because you’ll already have established connections with the perfect partners.
5. Encourage meaningful engagement. As we mentioned, while LinkedIn values engagement, it doesn’t like excessive invitations to engage with posts. Instead, integrate questions into your content and facilitate discussions. It’s worth making use of some of the built-in features like LinkedIn Live, polls, and links to other articles. This is the most natural and non-spammy way to encourage engagement.
6. Don’t include outbound links. The LinkedIn algorithm generally doesn’t like outbound links that send users off the platform. While it’s not a hard rule, we recommend minimizing outbound links and keeping users engaged within the LinkedIn ecosystem.
7. Get verified. Displaying a LinkedIn-verified badge won’t directly impact your content visibility, however, it does signal a certain level of credibility. In the long-term, this feature could have a bigger impact, so it’s worth jumping on board.

Wrapping Up

Paid advertising, like LinkedIn ads, is a necessary complementary tactic to business growth, but it can be quite expensive if not optimized effectively. Of course, by understanding the algorithm you can work it in your favor, so we hope that our guide will help enhance your B2B advertising reach.

Before launching your LinkedIn ads campaigns, consider taking our SaaS scalability score self-assessment. This assesses how well you currently attract, engage, and convert customers. Using the insights from this assessment, you can identify areas for improvement and implement strategies that support sustainable business growth.