Are you using Lookalike audiences?
Do you find yourself wondering how Facebook’s updates to Lookalike audiences will affect the audiences you’ve already created?
In this article, I’ll walk you through the new changes that have been made to the process of creating Lookalike audiences and the 4 different types you should include in your advertising.
What are Lookalike audiences?
Before we get into the changes to Lookalike audiences, let’s first go over the three Facebook audience temperatures that are the foundation to effective audience targeting and look into which temperature Lookalikes fall under.
The three audience temperatures consist of the following: Cold, Warm and Hot. Note that with each audience temperature there are different audience types. These are the specific audiences that you create in Ads Manager and use in your campaign ad sets.
Lookalike audiences make up one of the two types of Cold audiences available to you. These contain people who are unfamiliar with your brand or business and have yet to interact with you. They are the foundation of sustainable Facebook advertising returns and are the starting point for the majority of people who will become your customers from your ad campaigns.
Lookalike audiences are incredibly powerful and can easily be considered the most advanced targeting option on Facebook. They give you the ability to seek out new people that share the same characteristics as a source audience you control and give Facebook data points on, such as your website traffic. This includes tracking specific event actions people have taken on your website or you could even use your customer database or email list. This is the closest way to clone your existing customer base.
Lookalike Audience Creation Has Changed
How Lookalike audiences are created has recently been drastically changed. Facebook has gone ahead and removed the country targeting from the creation process, instead of moving towards encouraging the marketer to use the location you set in the ad set of your campaign.
At a glance, this could seem like a trivial change, but it’s important to understand it’s implications since some could be negative. One being Facebook disabling your current Lookalike audiences in the Audiences dashboard.
If you are using a Lookalike that was created using the old process, in an active campaign, it will still function as previously. However, you’ll get the following status error in your audiences’ dashboard.
But don’t freak out! Facebook will automatically recreate your Lookalike audiences and you’ll now see no audience size in the size column, but instead see the words “Size Varies”.
Secondly, unfortunately, there is now no convenient place to see all of the estimated sizes of your Lookalike audience, which is often a determining feature of your budget allocation. The larger the Lookalike the higher the starting budget you can set.
Instead, in order to find the size data you have to navigate to the ad set level, choose the relevant Lookalike from the custom audiences section and the country in the location section. Facebook will then give you a suggested audience size on the right side of the ad set navigation.
However, when you go to set your location for the first time, you’ll see the following message about the delay in seeing the audience size, as Facebook creates the Lookalike.
4 types of highly effective Lookalike audiences
Now, let’s look at 4 different types of highly effective Lookalike audiences that are worth testing in your Facebook advertising.
Lookalike audience built from people who have purchased at least twice
One powerful type of Lookalike is created from a source audience of people who have previously purchased from your brand or business at least twice. If you’re wondering why I’m saying twice as opposed to once, it’s to do with audience quality. By building out a Lookalike from people who have already begun moving along your customer journey experience, you are almost guaranteed to get a higher quality audience. This is because the Lookalike will closely match people who have already converted to a paying customer, including their buying behaviour, interests and values, which are all core components to factor in when creating a successful marketing campaign.
When creating all Lookalike audiences, you first want to create your custom audience to act as your source audience. This is the data pool from which Facebook will use to find new people who match as closely to this source audience as possible to populate your Lookalike.
As a Facebook marketer, you have the ability to create two types of source audiences to build the Lookalike. The first and most efficient method is to create a website custom audience of people who have triggered the Purchase event on your website at least twice.
To do this, in your audiences dashboard, click on Create audience. A drop-down will appear from which you should choose Custom Audience. The Custom Audience menu will now open and from the options choose website traffic.
Once the website custom audience creation window opens, select Purchase under the events section from the criteria dropdown list. When choosing your audience duration, select 180 days. The reason for this length of audience duration is that we want to include as many people as possible in this source audience in order for Facebook to have as much data as possible. This will increase Facebook’s ability to successfully find new people who are most likely to convert and match the data points on your source audience and populate your Lookalike audience.
Next, use the refine by section and choose the aggregated value, followed by frequency. This is how you set the number of event actions that need to be triggered for someone to be included in this audience. As mentioned earlier, we want to set the frequency as 2 and the condition is greater than or equal to.
Name your audience and click on Create Audience. When it comes to naming audiences, it’s good practice to use a naming template allows you to better understand what you’re looking at simply at a glance. This will make them easily searchable, and save time and confusion in the process. For example, we use WCA – Purchases 2+ – Last 180 Days.
Once you’ve created your purchase source audience, you’ll see a new window appear that gives you some next step options. One of which will be to use the audience that you’ve just created to build a Lookalike. Select this option and the Lookalike creation window will open.
Here’s where you’ll start noticing some differences with the creation process. Instead of having three steps, there are now only two steps. The first is to select your source audience and the second is to choose your audience size.
To create the Lookalike, search for your Purchase source audience, then select the size you want to create. Start with 1%, which will contain people who are most similar to your source audience. Repeat the creation process for the 2%, 3%, 4% and so on up to the maximum size of 10%, each with lowering degrees of similarity to your source audience.
To set your location for your Lookalike, simply set the location in the Ad Set in which you are using the audience. For example, if you want to target the UK, select your Lookalike from the custom audiences field in the audience section of your Ad Set and in the location section choose the United Kingdom.
The second method for creating the source audience for a Lookalike is for those who don’t have a large enough Purchase event audience. This involves creating a customer file custom audience and manually upload your customer database.
Lookalike audience built from people who have visited your website in the last 3 days
If you don’t have enough data to create an effective purchase event or customer file source audience for the first Lookalike we covered, make sure to carry on reading as this next one is for you.
The next best thing to building Lookalike audiences from customer lists or standard event actions is to use your website traffic. One effective website traffic custom audience that I’ve found to be effective for many of my clients whilst working here at the agency is to create a source audience of people who have visited your website in the last 3 days.
Again, from the dropdown list in your audiences dashboard, select Custom audience to open the custom audience creation window. Then click on website traffic to open the creation window.
Leave the default criteria of all website traffic selected, then from the audience duration enter the number 2 for the last 3 days. Name your audience with the same naming condition as we covered in the first Lookalike. A suitable audience name would be WCA – All Traffic – Last 3 Days.
Once you’ve created your source audience, navigate back to the audience dashboard and select the tick box next to the custom audience. Click on the three dots icon next to the delete button and from the Dropdown list click on Create Lookalike, this will now open the Lookalike creation window.
In the Lookalike creation window, the 3-day website custom source audience will already be selected. This means the only thing left to do is to choose your audience size and click Create audience.
Lookalike audience built from people who have engaged with your Instagram profile in the last 90 days
The next Lookalike audience is one that targets people who have engaged with your Instagram business profile. This uses the target audience from an engagement remarketing campaign as the source audience.
To create the source audience of people who have engaged with your Instagram profile, navigate to the custom audiences menu, as previously explained. Now, instead of selecting website traffic, you want to choose Instagram Business Profile. Once the creation window has opened, select your Instagram profile from the dropdown list and change the inclusion criteria from Everyone who engaged with your business to People who engaged with any post or ad. This will improve the quality of your lookalike since again, they will have the buying behaviour most closely matched to your source audience.
Compared with Purchase website custom audiences where you want to try and build the largest source audience, with this Engagement audience you only want to include the most relevant data. This means you need to find a balance in the audience duration, whereby you’re not missing out on potential customers but also not wasting our ad spend on users who aren’t your ideal audience. We’ve found a 90-day audience to be very effective.
With that being said, change the audience duration in the creation window to 90 days then name your audience. Use a similar naming condition to the website custom audiences we covered earlier, such as PEA – IG Ad Engagement – Last 90 Days.
Now in the audience dashboard, click on Create Audience and select Lookalike. Then in the Lookalike creation window search for the Instagram engagement audience you’ve just created, select your audience and click on Create Audience.
Lookalike audience built from people who have purchased a specific product
The next Lookalike audience is most effective when used whilst you’re launching complementary products in your business. One of the main reasons for this is that it allows you to find new people that are similar to customers that have previously purchased a specific product, and so will presumably have a need or desire for your product or service.
To create this source audience in the custom audience menu, click on Website. Then, in the website creation window, select purchases from the event dropdown. Now choose Refine by and then select content ID from the parameters section and make sure to enter the content ID of your specific product. Ensure the condition is also selected, otherwise you’ll end up tracking purchases that only contain the one product, instead of orders with multiple products including the one you want to track.
Change the audience duration to 180 days as we want to create the largest audience to produce the best quality Lookalike and click on create an audience. By using the content ID condition and the Purchase event action, you’ll have successfully grouped anyone in the last 180 days that triggered the purchase event into an audience, or those whose order contained that particular product.
Once you’ve created the custom audience, in the next steps window that appears, click on Create Lookalike. The custom audience will already be selected in the source field, now set your audience size starting with 1% and then name your audience.
How to use Lookalike audiences to get the best results
There are a number of ways you can use Lookalike audiences, depending on whether you are optimising for short term or long term goals.
For short term revenue generation, you can use Lookalikes in what are called Cold Purchase Tests. Here, you present your product or service to these audiences with the aim of generating immediate sales.
NOTE: Depending on how good your ad to audience fit is, as well as its relevancy ranking of your ads, result periods for Cold Purchase Test campaigns can be short as you are triggering the hyper-responsive segment of your audience. This is important to note since this group will saturate quickly as they only make up a small percentage of your total audience, meaning your results may initially seem good but will quickly drop-off.
For longer-term goals, you can use Lookalikes as the foundation of your advertising and start to warm up these Cold audiences, converting them into Warm audiences by engaging them with content-based ads as opposed to sales based ads. The types of ads are most effective for successfully cutting through all the noise your consumer is constantly bombarded with. They are far more likely to engage with content they are interested in, makes them laugh or inspires a sense of curiosity, as opposed to a regular product-pushing ad. You can then remarket your engaged audiences with product or services ads, via page engagement or video engagement custom audiences.
Facebook moving the location setting for Lookalike audiences has implications for both overall management efficiency and budget allocation, due to moving the estimated audience size to the Ad Set level and the delay in showing the size as they populate, as you create your campaign.
We covered four very different but equally effective Lookalike audiences that you can use to drive immediate sales or start the nurturing process with your potential customers.
What do you think?
Do you have the new Lookalike audience creation process?
Let me know by leaving a comment below.
About Charlie Lawrance
Charlie is an advertising strategist, writer, speaker, and agency owner. He’s the Founder and CEO of Gecko Squared, a Facebook and Instagram advertising agency that specialises in working with high growth clients from around the world including eCommerce, software and professional service businesses. He’s been planning and buying digital media for over 9 years since he started his first business aged just 18. Stay in touch by liking his Facebook Page (Charlie Lawrance).