What Are Lookalike Audiences And How Can You Use Them?

If you have spent any time running adverts on social media platforms, you will have heard the term lookalike audience. We’re going to take a look at what these are and how you can leverage the power of a lookalike audience in your own advertising. 

Lookalike audiences were created on the Facebook advertising platform all the way back in 2013. It’s an incredibly powerful feature and if used correctly will help you to generate leads at a fraction of the cost you may be currently paying for them. You are able to create a lookalike audience in a number of ways based on user interaction with your brand either on, or off the Facebook and Facebook partner platforms. The one we will be working with today, and the one that we believe has the highest impact is that of a customer list lookalike audience.

Why Should You Use A Lookalike Audience?

There are two ways that you can currently target prospects on the Facebook advertising platform. 

1. Interest targeting
2. Lookalike audiences

Interest targeting is a powerful tool. Don’t get us wrong. The Facebook platform has some incredibly detailed targeting options from demographics, such as newlyweds to parents of children in different age groups, to interests based on literally anything that you can find on the internet. Dig hard enough, do enough research and you’ll be able to find pretty much anything in the interest targeting options. Delve even further into this with flex targeting, which is where you narrow down your search conditions i.e. parents of children aged between 5-9 AND are British expats (Yes, you can do this) and you have a super targeted and detailed targeting option.

However, using interest targeting means that you have to get Facebook working pretty hard to find these types of people. Even then, not all of these people will be your target audience. Not all of them may have the same challenges as each other and most of them certainly won’t be ready to buy.

Here’s where a lookalike audience comes into play. It also highlights the extreme importance of having a high quality data list and ideally a list of your current clients. You have the option to add a customer file into the Facebook advertising platform. Once uploaded, you can use this as a targeting audience on its own, or you can ask Facebook to create a lookalike audience of between 1-10% similarity to the list you have uploaded. What does this mean? Well, it means that Facebook will go out and find people who look like your list to within 1-10% similarity. This includes all behaviours on Facebook, its partner platforms and your website. Any actions they may have taken and any other pieces of data that can be recorded.

You’re literally leveraging the Facebook platform and system to find people who look exactly like your existing clients. Now you understand why its so important that the data you upload is good and relevant!

The Benefits Of Using A Lookalike Audience

You probably don’t need much convincing now to get started with using lookalike audiences in your own advertising. They are super powerful and can help to rapidly improve your lead generation results, but there are a few other added benefits of using a lookalike audience.

Better Targeting

Assuming that you have a good data list being uploaded, you completely take the guesswork and error margin out of the equation, for targeting at least. You will be able to place your advert in front of people who take the exact same action as your clients have done. The really great thing about using a lookalike audience is that unlike in the interest targeting options, you aren’t limited to a selection of interests. 

For example, your ideal client may be interested in a wide variety of things. Things that you might not have thought about adding into your interest targeting options. Therefore, you could be missing out on a whole section of audience that might be interested in your offer. Your lookalike audience is based on data points and interactions, so the interest options may well cross over, but the activity element of the online presence means they get matched up and added to the targeting.

Improved ROI

ROI is probably the most critical business metric out there. When it comes to advertising its about as important as they come. When you spend money on paid ads, it’s money being directly spent to achieve something of value back i.e. a lead generated for potential business.

When using lookalike audiences, you are placing your advert in front of people who are also likely to take the action you want them to take, like booking a consultation with you. This greatly reduces the amount of people the advert needs to be shown to, to generate the result of a lead and subsequently dramatically increases the ROI of the advert. 

Lower Ad Costs

Just imagine it’s costing you $5 to generate a lead at this moment in time. Now let’s assume that because you have a really great lookalike audience you are reaching more people and converting a larger percentage of them. Your ad budget is being better utilised which means you aren’t wasting any on showing ads to people who may never be interested in buying. The upshot of this is that the same ad budget you were spending earlier on interest targeting is now going a lot further, reaching more people and generating you better results. 

The $5 it was costing to generate a lead before is now $2 meaning you have another $3 to spend on ads. Considering it only costs $2 to generate a lead, you’ve now got an extra lead’s worth of money to spend.

Lookalike Audiences For Financial Advisers

Lookalike audiences are powerful tools. They have been instrumental in helping our clients to get fantastic results from their advertising campaigns. It’s also really important to remember that the data you add in is what Facebook will give back to you. So, that big data list of expats you just bought from a data provider is probably not the best option for you to upload.

It’s also important to remember that other targeting options have benefits too and can be used to help improve the data coming from your lookalike audience. It can be easy to rely on a really good source of data, but data pools shrink, people move and prospects get ad fatigue. Having a good blend of advertising options across a number of different channels will always help you to get the best results.

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