• by Colin Kirkland , December 28, 2023

While emerging competitor apps like Bluesky, Mastodon and Threads continue to grow along with users' dissatisfaction with X (formerly Twitter), ongoing controversy at Elon Musk's company has also resulted in LinkedIn reporting a rise in ad revenue in response to X's recent advertiser exodus.

Higher demand is driving up ad prices on LinkedIn as brands reallocate spending after leaving or pausing campaigns on Musk’s microblogging platform. 

The prices of LinkedIn ads -- which are sold by auction and set by market demand -- have increased as much as 30% over the past year, one executive told the Financial Times.

Some marketers have reported premium LinkedIn campaigns costing $300 per 1,000 impressions -- a very high price compared to the same caliber of ad costing between $10 and $15 on Meta -- with some media buyers reporting a return on investment as high as 20%.

Meta and Google still control a much higher percentage of the ad market -- with LinkedIn covering about 1.5% of digital advertising spending in the U.S., while Meta and Google cover 21% and 27%, respectively.

Still, estimates from Insider Intelligence show that annual advertising revenues at the Microsoft-owned company rose almost $4 billion in 2023 -- a 10% year-over-year increase. The research group also predicts added growth of 14% in 2024.

“This is LinkedIn season,” Leesha Anderson, vice president of digital marketing and social media at Outcast ad agency, told the Financial Times. “Most have switched over to LinkedIn over the past year . . . A few weeks ago most of our clients were off X. Now they are all off X.”

A similar trend has been seen on other social-media platforms, as three of the largest U.S. companies -- Disney, Comcast and Paramount -- recently increased their ad spending on Instagram and Snapchat after pausing their ads on X due to the rise of antisemitic content on the app and Musk's aggressive response to advertisers leaving his platform.

LinkedIn seems to have strategized around Musk's unpredictable behavior. Shortly after Musk told major brands to “go f*** themselves” at The New York Times’ DealBook event, LinkedIn assured brands in a pitch deck that they could “work with a partner who respects the world you operate in.”

Over the past few years, the job-finding app has transformed into a social hub for professionals as new features continue to facilitate business-to-business communications. On LinkedIn, brands are able to use a more narrow and focused approach, targeting their B2B sales by company, seniority or job title, or a mix of both.

Members with C-suite titles grew by 11% year-over-year in 2023, according to LinkedIn data from April.

As the platform continues to grow its ad revenue, it is testing new ways for media buyers to target users, such as an integration through connected TV apps like Roku, Peacock, Pluto, Fox Sports, Hulu and Disney+, as well as a premium ad slot similar to the Amplify slot offered by X.