In this recipe, we’ll explore a highly effective method for creating lookalike audiences with a significantly high probability of conversion and how to effectively target them through Facebook Ads.
While Facebook Ads offer a vast pool of potential customers, the challenge lies in identifying those who are not only interested but also more likely to make substantial and consistent purchases over time. To create lookalike audience, you can employ various targeting criteria such as location, audience size, engagement metrics, customer value, behavioral and interest factors, or even specific conversion events. As NotifyVisitors tracks all this data, you can create segments of your existing user base in NotifyVisitors based on any of the above targeting criteria and create lookalike audiences.
However, it has been widely observed that one of the most potent strategies for building a high-conversion lookalike audience is by focusing on the value of your existing customers. These tailored lookalike audiences empower brands to automatically connect with their ideal buyers who exhibit a higher propensity for conversion. This recipe serves to eliminate the need for manual audience creation, a time-consuming and often imprecise process, as mere “likes” and general interests tend to be inadequate predictors of customer value. Instead, we’ll guide you on consistently targeting an audience that closely mirrors your highest-value customers—the kind of loyal patrons who have consistently demonstrated their commitment to your brand and are more likely to maintain consistent and higher-value purchases.
Table of Contents
Step 1 : Segment high value customers using RFM analysis
To effectively gauge and categorize customer value, NotifyVisitors employs automated algorithms that calculate the RFM score of a customer, which stands for Recency, Frequency, and Monetary value. This score takes into account how recently a customer made a purchase, how often they make purchases, and the monetary value of their orders.
Utilizing the RFM score, NotifyVisitors automatically segments your audience into various categories, including champions, loyal users, at-risk customers, hibernating, and more. Champions are characterized by the highest RFM scores, while hibernating customers have the lowest scores.
To create these RFM segments, follow these steps:
1. Access the “Segments” section within the NotifyVisitors panel and choose the “RFM Segments” option.
2. Click on the setting icon and select a duration for segment creation We recommend using 180 days, but if your business operates with shorter purchase cycles or deals with replenishable products, you can opt for a shorter duration.
3. After specifying the duration, click the “Create” button. Within a few minutes, your segments will be automatically generated.
For more in-depth information on RFM segments, you can click here to delve into the details.
Step 2 : Sync segments with Facebook
The segments known as “Champions” and “Loyal Users” are distinguished by their notably higher RFM scores. As a recommended strategy, we suggest synchronizing both of these segments with your Facebook audience list. To achieve this, make sure your Facebook account is connected to our platform. If you haven’t connected it yet, you can follow our guide, “Prerequisites of Facebook Integration,” for seamless connection.
Once your Facebook account is successfully linked, follow these steps to sync the segments:
1. Navigate to the “Campaigns” section. Select “Retargeting Ads,” then “Create Campaign.” and click on “Facebook.”
2. In the “Target Segment” section, choose the “Sent to Rule” as “Users in any of these segments.” From the dropdown menu, select the “Champions” and “Loyal Users” segment.
Please note that for successful lookalike audience creation, a minimum sync of 2,000 users is recommended. This requirement stems from the fact that Facebook mandates a minimum of 1,000 users for lookalike audience creation. However, it’s important to understand that Facebook primarily identifies users with their email addresses and phone numbers. Consequently, if some users have Facebook accounts associated with different email addresses or phone numbers than the ones in your NotifyVisitors account, or if you lack email or phone number for certain users, these individuals may not be recognized by Facebook. This underscores the importance of syncing your segments with a minimum of 2,000 users to increase the likelihood of a successful and robust lookalike audience creation process.
3. After you’ve chosen your desired segments, you can further refine your audience by excluding specific users from your “Champions” or “Loyal Users” segments whom you don’t wish to sync. To accomplish this, create a segment comprising the users you want to exclude, and then select that segment from the dropdown menu in the “Exclude” section.
4. Next, select your Facebook ad account and the corresponding audience list.
For more comprehensive, step-by-step instructions, we recommend referring to our guide titled “Sync NotifyVisitors Segments with Facebook Audience.”
Once you’ve filled in all the necessary details, proceed to send your campaign. This action will facilitate the synchronization of your segment with your Facebook audience list, ensuring that your advertising efforts are precisely targeted and optimized.
Step 3: Create lookalike audience
Now that you’ve successfully synchronized your audience list with data from NotifyVisitors, you can proceed to create a highly targeted lookalike audience on Facebook. Here’s how you can do it:
1. Access your Facebook page and click on “Audiences” from the left panel.
2. Click on the dropdown menu labeled “Create Audience” and select “Lookalike Audience.”
3. From the “Select your lookalike source” options, choose your audience list. Then, click on “Create New Source” and select “Custom Audience.”
4. Now, you can fine-tune your lookalike audience by selecting a percentage between 1 to 10. A 1% lookalike will consist of individuals who closely resemble your original source audience, while increasing the percentage will result in a larger and broader audience.
5. Once you’ve made your percentage selection, click on “Create Audience.”
Please note that after creating your lookalike audience, it may take some time, typically 6-24 hours, for Facebook to generate and finalize your new audience.
If you’ve opted for the recurring option while setting up your Facebook ad campaign, NotifyVisitors will automatically sync your segments with the Facebook audience list according to the defined time period. As a result, Facebook will refresh and update your lookalike audience automatically every 3-7 days, ensuring that your advertising efforts remain finely tuned and effective.
Click here to learn more about Meta’s lookalike audience creation guidelines.
Once your audience is created, you can run Facebook ads to target these audiences and convert them into customers.
Another effective strategy is to create two distinct audience lists for your “Champions” and “Loyal Users.” By running separate ad campaigns for each of these audience segments, you can evaluate their individual performance and make data-driven decisions to enhance your bidding strategies. For additional insights on optimizing your lookalike audience, you can click here to explore best practices.
Constructing a Lookalike Audience on Facebook from your highest value customers is a potent strategy for amplifying the reach and effectiveness of your advertising efforts. With the leverage of NotifyVisitors RFM analysis to identify and categorize your most valuable segments, you can seamlessly synchronize them with your Facebook audience list. This synchronization opens the door to creating a targeted and refined Lookalike Audience, maximizing the potential for attracting similar, high-value customers.