LinkedIn advertising is a great tool for B2B marketers. At Factors.ai we have seen firsthand how easy it is to make costly targeting mistakes on LinkedIn. Over time, we have identified key areas where marketers go wrong and simple adjustments that can drastically improve campaign performance.
Here are the most common LinkedIn ads targeting mistakes and how to avoid them.
TL;DR
- Use ‘based out of this location’ for precise targeting.
- Avoid early audience expansion—test ICP first.
- LAN can be useful but requires strict monitoring.
- Build external industry lists for better targeting.
- Job function vs. job title: use both strategically.
1. Understanding LinkedIn's Location Targeting Options
If you're running LinkedIn ads, you've probably noticed two location targeting options: ‘based out of this location’ and ‘recently been in this location.’ Choosing the wrong one can drain your budget faster than a leaky faucet.
From my experience at Factors.ai, I've seen countless campaigns fail because marketers opt for ‘recently been in this location.’ Let me explain why that's a problem. Imagine targeting C-suite executives in New York. If you choose the ‘recent’ option, you might end up showing ads to executives who were just visiting for a conference. They fly back to their home country, and there goes your ad spend.
Always go for ‘based out of this location.’ It ensures you're reaching professionals who live and work in your target area, making your campaigns more cost-effective and results-driven. This simple switch can significantly improve your LinkedIn campaign's ROI.
2. The Pitfalls of Early Audience Expansion
One of the most costly mistakes I see marketers make is enabling audience expansion too early in their LinkedIn campaigns. It's tempting, I get it. LinkedIn's algorithm promises to find similar audiences, and who doesn't want more reach?
But here's the harsh truth: expanding your audience before thoroughly testing your ICP (Ideal Customer Profile) is like throwing darts in the dark. At Factors, we've analyzed thousands of campaigns, and the data is clear - premature audience expansion typically leads to wasted spend and diluted results.
Start with your core audience. Test your messaging, optimize your ad creative, and maximize engagement with the people who match your ICP perfectly. Only when you've truly exhausted this audience, meaning declining reach or rising CPCs—should you consider expansion. This patient approach might seem slower, but it's the surest path to sustainable campaign performance.
3. LinkedIn Audience Network: When to Use and When to Avoid
The LinkedIn Audience Network (LAN) is a classic double-edged sword. While it promises extended reach beyond LinkedIn's platform, it often becomes a budget drain if not managed carefully.
From our experience, LAN makes sense in three specific scenarios:
- When your target audience size is critically small (under 20,000).
- During broad brand awareness campaigns where reach is the primary goal.
- When targeting regions with low LinkedIn activity.
However, here's the catch: ad fraud and poor-quality placements are real concerns. If you decide to use LAN, implement these safeguards:
- Always use a whitelist of trusted publishers.
- Maintain an active block list.
- Monitor performance metrics closely, especially click-through rates.
Remember, just because you can extend your reach doesn't mean you should. Quality of engagement usually trumps quantity when it comes to B2B LinkedIn advertising.
4. Industry Targeting Challenges and Solutions
LinkedIn's industry categories are notoriously broad and often misleading. We've seen countless examples where companies are miscategorized, leading to wasted ad spend. Take Spotify, for instance—LinkedIn might categorize it under ‘Music’ when it's fundamentally a tech company.
To overcome this, we recommend a two-pronged approach:
- Build your own industry list externally, focusing on your ideal customer profile (ICP).
- Upload custom company lists rather than relying solely on LinkedIn's categories.
Pro tip: Don't just look at what industry your prospects are tagged with. Instead, analyze their actual business model and revenue streams. A company tagged as ‘Manufacturing’ might have a robust SaaS division that makes them perfect for your tech solution.
Industry targeting is just one piece of the puzzle. Combine it with other targeting parameters like company size and job functions for better precision.
5. Job Function vs. Job Title: Making the Right Choice
One of the most confusing choices in LinkedIn advertising is whether to target by job function or job title. Here's the reality: job functions cast a wider net but can be too inclusive, while job titles offer precision but might severely limit your reach.
For example, targeting the ‘Business Development’ function might include everyone from BDRs to administrative assistants. On the flip side, targeting specific titles like ‘Head of Revenue Operations’ might miss out on similar roles with different titles like ‘Revenue Operations Leader’ or ‘RevOps Director.’
Our recommendation?
Start with job functions combined with seniority levels for awareness campaigns. Then, as you gather data and optimize, experiment with title-based targeting for bottom-of-funnel campaigns. Remember to account for title variations—someone who's a ‘CMO’ in one company might be a ‘Head of Marketing’ in another.
6. Optimal Audience Size for LinkedIn Campaigns
From managing hundreds of LinkedIn campaigns at Factors.ai , I've learned that audience size isn't a one-size-fits-all metric. While LinkedIn recommends a minimum audience size of 50,000 for sponsored content, our data suggests that highly targeted B2B LinkedIn ad campaigns can perform well with audiences as small as 20,000.
The sweet spot? For most B2B campaigns, aim for an audience size between 30,000 to 100,000 members. Going too broad (500,000+) typically leads to wasted spends and diluted messaging, while too narrow (<10,000) limits your reach and drives up costs.
Pro tip: If your audience is too small, don't immediately enable audience expansion. Instead, try these tactics:
- Expand to similar job titles.
- Include additional relevant industries.
- Add complimentary job functions.
- Consider including more locations if relevant to your ICP.
Remember, quality over quantity. A smaller, well-defined audience often outperforms a larger, loosely targeted one.
7. Targeting by Company Size: Best Practices
One of the most deceptive targeting options on LinkedIn is company size filtering. After analyzing data from our clients, we've noticed two critical mistakes marketers make.
First, relying solely on LinkedIn's predefined company size brackets can be misleading. For instance, a company showing ‘201-500’ employees on LinkedIn might actually have 1000+ employees because not all workers maintain LinkedIn profiles.
Second, marketers often forget to exclude unwanted company sizes, leading to wasted ad spend. If you're targeting enterprises, explicitly exclude smaller companies using the ‘exclude’ feature.
A quick tip: Cross-reference your target companies' LinkedIn employee count with their actual employee numbers (from sources like Crunchbase or company websites). This helps you understand the typical disparity and adjust your targeting accordingly.
Remember: Company size targeting works best when combined with other filters like industry and job function rather than used in isolation.
8. Member Skills and Groups: Hidden Opportunities
While most marketers focus on job titles and company targeting, LinkedIn's member skills and groups remain underutilized goldmines. We've seen campaigns achieve up to 30% better engagement rates when incorporating these targeting options strategically.
Skills targeting is particularly powerful because it reflects what people do rather than just their job titles. For instance, targeting people with ‘Salesforce Administration’ skills might be more effective than broadly targeting ‘Sales Operations’ roles.
Groups are even more interesting—they show active interest. Someone who joins a ‘B2B Marketing Innovation’ group is likely more engaged in the field than someone who simply lists marketing as their job function.
Pro tip: Don't just target the obvious skills. Look at your best customers' profiles and identify common secondary skills. These often provide unique targeting opportunities with less competition.
Warning: Avoid targeting groups that haven't had any recent activity. Many LinkedIn groups are dormant.
9. Avoiding Campaign Budget Waste
One of the biggest money drains in LinkedIn advertising is poor budget management. I've noticed three critical areas where budgets typically leak:
- Running ads 24/7 instead of during business hours when B2B decision-makers are active.
- Not setting frequency caps, often leads to audience fatigue.
- Keeping underperforming campaigns active too long without optimization.
The solution?
- Start with a minimum daily budget of $50/campaign to gather meaningful data.
- Monitor your campaigns between 9 AM - 6 PM business days, and pause them during off-hours.
- Set view frequency caps 2-3 times per week to prevent ad fatigue.
Most importantly, use automated rules to pause campaigns that aren't meeting KPI thresholds after spending 2x your target cost per lead. This alone can save 20-30% of your budget from being wasted on non-performing campaigns.
10. Advanced Targeting Strategies for 2025
As we move deeper into 2025, LinkedIn's targeting capabilities have evolved significantly. Here are the cutting-edge strategies that are delivering results:
First-party data integration is now crucial—upload your CRM data and create lookalike audiences based on your best-converting customers. LinkedIn's AI has gotten much better at finding similar profiles.
The new ‘Intent Signals’ feature lets you target users who've shown interest in specific topics through their content engagement. Combine this with traditional targeting for hyper-focused campaigns.
Account-based marketing (ABM) on LinkedIn has become more sophisticated—use LinkedIn's API integrations to sync target account lists in real-time and adjust bids based on account priority.
Also, read ABM Tactics for B2B Marketers.
Most importantly, leverage ‘Buying Committee’ targeting that allows you to reach multiple decision-makers within the same organization simultaneously, which is essential for complex B2B sales cycles.
When implemented correctly, these strategies show 2-3x better conversion rates than traditional targeting methods.
