Facebook Lookalike Audience – Definition, Features & step-by-step Creation Process

Facebook provides 3 different types of audiences for targeting with ads. In the following article, we’ll be looking into one such audience type – The Facebook Lookalike audience. We’ll be discussing what a Facebook lookalike audience is, why to use a lookalike audience, the sources of creating a lookalike audience, and how to create them in the Ads Manager.

What is Facebook Lookalike Audience?

A Facebook Lookalike Audience is an audience list that is created based on your existing customers. It is basically a way to reach new people who are more likely to be interested in you because they are similar to your best existing customers.

Why use a Facebook Lookalike Audience?

• Acquire new users: A Lookalike audience helps you attract newer users to your website, improving your brand visibility.
• Better conversion rates: Facebook uses the blueprint of your best converting existing customers to create the lookalike audience. So, they tend to have much better conversion rates compared to other targeting options.
• Contol on the lookalike audience size: Facebook gives you control over the audience size. This ensures that you do not end up spending more than you intend to.
• Less expensive: The acquisition rates of lookalike audiences are going to be comparatively lower. This is owing to the precise source targeting that a lookalike audience provides.

What is the Source audience for Facebook Lookalike?

In order to create a Lookalike audience, Facebook pulls data from your Custom Audience which has information like your pixel, mobile app or fans of your page. Then, the Facebook algorithm tries to find out the common qualities of the people in that list, for instance, their demographics, interests, and others. Based on this information, Facebook creates a list of users who most closely resemble your source audience, to whom your ads are served.

There are 2 basic sources of a lookalike audience:

• Custom Audience
• Custom Audience with LTV or Value-based lookalike audience

Facebook Custom Audience as a source for Lookalike

The most commonly used source for creating a lookalike audience. This includes features like website visitors, uploading customer lists, app activity, or offline activity. It can also make use of other Facebook sources like Video, Instagram, Lead form, Events, Instant Experience of Facebook Page to create your lookalike audience list.

Facebook’s Value-based lookalike audience

This feature in Facebook allows you to target potential customers who have s similar buying behavior as your current customers. It takes into consideration the Lifetime value (LTV) of your existing customers and creates a lookalike based on those values.

In order to create a Value-based lookalike audience, an excel sheet needs to be uploaded to Facebook with custom audience details of your existing users along with their life-time value LTV. Based on the LTV, Facebook would target the ads to the corresponding users.

How to create a Lookalike audience?

In order to create a Lookalike audience in Facebook, perform the following steps:

1. Navigate to the Facebook Audience tab

• Login to your Facebook ads manager (https://www.facebook.com/ads/manager/)
• Select the Facebook Audience tab, located in the menu option in the top-left

2. Select the Audience Type

• Select Lookalike audience from the available audience types

3. Select the Audience Source

• As previously discussed, you’ll be presented with two sources to create a lookalike audience – Custom Audience and Custom Audience with LTV.
• As per your requirement, select the audience source that best suits you. If you’re trying Facebook lookalike audience for the first time or not sure what the LTV of your business is, I recommend you opt for Custom audience as your source.
• For now, let’s create a lookalike audience with a Custom audience as the source. Click on Custom Audience.

4. Creating the Custom Audience

• Once you click on Custom audience, you will be presented with the following screen:

• In most cases, businesses like to create a lookalike audience based on their existing customers, which can either be retrieved through the Website or directly uploading the Customer list. In this case, we’ll create a custom audience based on the users who have visited your website.
• Click on ‘Website’ as the source.
• You’ll see the Website Custom Audience creation tool.

• Here, provide a name to your Audience along with the conditions through which you want to create your custom audience. And click Continue.

5. Select Audience Location

• Now, you’ll be taken back to the 3^rd step where you need to provide the location where you want the target audience to be targeted. For example, if you want to target the ad to users only based out of India, select Select ‘India’ as your Audience Location.

6. Select Audience Size

• Select the number of lookalike audiences you want to create. You can create multiple lookalikes with different levels of similarity to your source. This allows you to bid differently for audiences with different conversion values. I would suggest you start with one and experiment with others later once you’re sure of its functioning.
• Next, select the audience size range which ranges from 1% to 10%. A 1% lookalike audience size consists of the users who most closely resemble your lookalike source. Increasing the percentage creates a much bigger and broader audience. As per other businesses, a 1% audience size would fetch you the best results. However, you can experiment with different audience size ranges and find out which works the best for you. In this case, lets select 1%. Select 1% and click ‘Create Audience’.

That’s it. You have created your Lookalike audience in Facebook.

Note – It may take 6 to 24 hours for our Lookalike audience to be ready. Post that, the lookalike audience list would automatically refresh every 3 to 7 days.

Features of a Facebook Lookalike Audience

• The lookalike audience will only include users from the country that is selected during creation.
• The Source audience must at least contain 100 users from a single country.
• A single source audience can create close to 500 lookalike audiences.
• The lookalike audience will automatically exclude the source audience.
• A single ad set can make use of multiple lookalike audiences.

Summary

So, in this article, we’ve discussed in lengths about the Facebook lookalike audience, the definition of lookalike audience, why to use a lookalike audience, the different sources of a lookalike audience, and finally, how to create one.

Reference – Facebook Support

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