Study: “LinkedIn is Basically a Money Pit” Because of Ad Fraud

by | Sep 8, 2020 | Marketing Essays

(Note: For more, see a prior speech of mine on how much of the Internet is fake and a column of mine in The Drum on what marketing and media professionals should do in response.)

The LinkedIn Ads network is likely awash in mistaken clicks and bot traffic that make the platform’s value extremely dubious, according to a new study from global digital agency RMG that the company shared exclusively with me.

Three weeks ago, RMG founding partner Ryan Gellis posted a thread wondering if LinkedIn “is full of fraudulent accounts and unchecked misclicks that artificially inflate the cost of advertising and result in poor performance compared to other ad networks.” The ensuing discussion inspired him to look into the issue further.

Gellis goes through his findings in this YouTube video. For the test, RMG promoted a webinar by targeting c-certain c-suite executives at large companies in the United States based on their job titles. The ad encouraged them to click to sign up for for event for free.

The first issue the agency found was the projected versus actual cost per click. LinkedIn estimated a $25 average CPC. The actual campaign CPC was nearly $45.

“What’s the point of forecasting if you project one cost and then the actual cost ends up being 200% the projection?” Gellis asks in the video.

But the real issue was the source of the clicks themselves. LinkedIn’s ad platform reported 11 clicks. RMG’s logs showed ten clicks. FullStory, the digital experience analytics platform that RMG uses, stated that eight people registered for the webinar. However, the true number of registrations was zero.

“Zero people signed up for the webinar from that specific campaign,” Gellis told me in an interview. “That’s kind of the punch line and why I believe this is newsworthy. Nobody signed up. In fact, nobody even exhibited what I believe is real user behavior on the site after clicking the ad. That is also true of all the other ads we ran on LinkedIn. We had a total of 0 people ever “sign up” on any ad we ran during our testing on LinkedIn — regardless of the ad format or messaging.”

RMG suspects bot activity or misattributed misclicks had been the cause because visitors would bounce away from the webinar’s landing page before it even had a chance to render — in other words, they would click the LinkedIn advertisement and then leave the website in less than 1.3 seconds. In addition, FullStory reported mouse movements that were nothing like what an actual human would do.

“As far as we’re concerned, the LinkedIn ad network basically has fraudulent clicks and/or misclicks that don’t get attributed to the users that are being passed through as leads in campaigns,” Gellis says in the video.

Of course, the simple size in RMG’s one-day test was extremely small. The target audience size was 16,000. The number of impressions would be between 680 and 2,000. The cost was $250. But Gellis told me that the results match a prior, larger test.

linkedin ads

During a $3,000 campaign in March, LinkedIn reported 256 clicks with an average CPC of $11. The company received zero leads from all of the clicks.

“You’ll see the call to action is ‘Request Demo,'” Gellis said. “So, arguably, a user who sees this ad and clicks legitimately on it will be looking to get a demo of the analytics tool we were marketing. If the ads were giving us behavior like this on a $3,000-per-month budget, it’s unlikely they would have performed any better with additional budget.”

RMG charges that LinkedIn’s advertising is on a closed network and does not follow the Interactive Advertising Bureau’s standards for digital advertising. (The IAB did not respond to a request for comment.)

After reviewing RMG’s findings, a LinkedIn spokesperson sent me the following company statement.

“LinkedIn is a members-first organization and our Ads program is designed to ensure that only high-quality, relevant ads are served to our members. We prohibit the use of bots or other automated fraudulent methods to access our services, as they are in violation of the User Agreement. Additionally, LinkedIn is a member of the IAB and works closely with the organization and its members to help develop standards for the digital advertising industry.”

But when summarizing his findings in the video, Gellis is skeptical of LinkedIn.

“As far as we can tell, LinkedIn is basically a money pit,” he says. “You’re not going to get the performance that you would expect out of the network.”

(Note: For more, see a prior speech of mine on how much of the Internet is fake and a column of mine in The Drum on what marketing and media professionals should do in response.)

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