Facebook Lookalike Audiences demystified

Facebook advertising audiences can be confusing, so let's look at what one of the common types of audiences means.

Inside this episode I'll discuss what a lookalike audience is, how it's created and how you can use it in your business. It's a very powerful feature of Facebook ads that can help get you in front of more of your ideal clients.

Inside this episode I also mention my free masterclass 'Sell (more of) your online course with Meta ads' which you can watch for free here. 

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Website: www.newschoolofmarketing.com
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Instagram: @bianca_mckenzie

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Transcript

Hey, welcome back to the new school of marketing podcast. I'm so grateful to you for tuning in. Before we dive in, I would love to pay respect and acknowledgements to the Palawa people of Lutruwita who are the traditional owners of the land on which my business operates. And I pay my respects to the eldest, past, present, and emerging. 

Welcome, welcome. I hope all is well where you are. I am looking at an overcast day, but it's actually pretty warm outside. I had the farrier coming earlier to trim the horse and the pony's feet. And, yeah, it was actually a lot hotter than I thought it would be. So, yeah, here I am sitting in my office, back in the nice, cool air. I hope it's awesome where you are. We're kind of like enjoying the last of summer here in. Well, I'm saying the last of summer. Honestly, it's February. It could still be hot next month. So we'll see what happens. All right. Before I have to dash for the school pickup, I really want to talk to you about lookalike audiences because, yeah, I've been doing this for more than ten years, and lookalike audiences have been around for a while, but I still get people sort of not sure about what lookalike audiences are when they use them, what they're really good for. 

So I wanted to have a chat about it. So let's look at it, what it really is, because you might kind of go, I've heard the term, or maybe you haven't, but you don't know what it is. So when a Facebook ad strategist talks about a lookalike audience, they mean an audience that Facebook can create for you. Well, you have to plug in the settings and the parameters, but you can create this audience in Facebook with people who have similar traits to those who are in a custom audience that you create. Now, let's first look at what a customer audience is, because you kind of might go, hang on, what you just said, lookalike audience. Now you're talking about custom audience. Might have lost me there. So a custom audience in Facebook is an audience that you can create based on people who have already had interactions with your brand. For example, you can upload your customer database to Facebook, and then that is a custom audience. So you've then created it in Facebook. That is a custom audience in Facebook. Or you can create a custom audience of people who have visited your website in a specific time frame. For example, you create a custom audience of everyone who has visited your website in the past 180 days, because that's the limit, you can't go past that. This only works if you have the pixel installed on your website. So there's no point in creating a custom audience if you haven't actually tracked with the Facebook pixel who has gone to your website, because Facebook won't know who's gone to your website. You can also create a custom audience of people who have watched a particular video. So if you create videos on Facebook or on Instagram, because Facebook and Instagram kind of work together. So let's say you've uploaded a reel or a video and you kind of want to create a custom audience of everyone who has watched that particular video. So those custom audiences can be used in retargeting. And I'm pretty sure that if you're on Facebook or on Instagram, that you're familiar with retargeting, even though you might not know that that's what it's called. So imagine you are scrolling, I don't know, some website. You're visiting a website and then the next day you're scrolling on Facebook or on Instagram and you see an ad from that particular website or even that particular product that you've been looking at that's called retargeting. And they have set up a custom audience of everyone who has visited their website. And you can get as particular as a specific product and things like that. So that is a custom audience. So when you create a lookalike audience, you can basically tell Facebook to find people who are similar, for example, similar to your customer database that you've uploaded, or similar to those people that have visited your website, or similar to people who have visited or watched a video. So you basically tell Facebook, here's my custom audience. Here's a list of all the people who have purchased from me or everyone who's on my list. Now, I want you to find people who have similar traits that could also be the right audience for me. And that is what is called a lookalike audience. And it's super powerful and I really just love using it because in a way, it makes it easier. Facebook knows so much about us, so why not tell it? Hey, here's who already likes know. Here's already a list of people who bought from me. Can you find me more of those people? And when you create a lookalike audience, you can select a country that you would like Facebook to find these people from. So, for example, if you have a majority of people purchasing in Australia, but you want to branch out into the US, you can literally say, here's my australian audience, I now want a lookalike audience, like people that are similar to this audience, but I'm going to a different country. And you can also select a percentage of people that are most similar to your custom audience. I know it gets a little bit trickier here. So, for example, if you choose Australia and 1%, then Facebook creates an audience for you with 1% of all Australians on Facebook who are most similar to the custom audience that you have uploaded. Now, there is a bit of maybe not controversy, but some people say, don't only use 1%. Some people say, go broader. I am someone who says, test it. So you can say, because the way it works is 1% is the most similar to your custom audience. And then if you go 2345 all the way up to ten, that's meant to be not as similar, but still has some traits. I'm someone who goes, I create a lookalike audience for the 1%, but then I also create a lookalike audience from one to 3%, and then usually three to five or six. Sometimes I list them all, zero to one, one to two, two to three. Sometimes I go literally five to 10%. So one to five, five to ten, and test it, because you just don't know. You might get people in that five to 10% that actually perform better or are more likely to buy from you than the 1%. So you need to test it. And in order to create a lookalike audience, you need 100 people in the custom audience that you created that are based in the same country. So if you uploaded your entire customer database and you wanted to go into a certain country, but you haven't sold 100 to that particular country, it won't actually work. So it doesn't necessarily need to be the same country as the audience that you're building. For example, you can upload a list of over 100 Australians and then create a lookalike audience of Canadians. You can do that. So test it, play with it. Sometimes there's changes, but so far, that's how it has been, that you have to have 100 people in the same country. When should you use a lookalike audience? So when do you actually use this kind of audience? Because there are people that essentially are in a cold audience. They look like the people who are your audience, but they don't know you yet. So I'm going to say, as with any marketing activity, it really depends on your goal. So I often use lookalike audiences when I'm running list building campaigns, and I want to find more people who in a sense look like those who are already on my list or my clients. So it is entirely up to you. But think about it like they are, in a way a cold audience. And it's good to remember that a lookalike audience based on your customer database is most likely going to be much higher quality audience than a lookalike audience of people who have watched a specific video or who like your Facebook page. Because you can literally make lookalike audiences based on a lot of different things. But if you create it based on your customer database, that's probably the most similar. Facebook is going to find the most similar people to who already buy from you. Every single lookalike audience will perform different like to another one, and sometimes doesn't very happen very often. But sometimes a lookalike audience actually performs worse than a complete cold audience made up out of interest. So you need to test it. So the best way to learn which lookalike audiences are the best for your business is basically to create a few different ones and just test them. Test them against your 1%, your 5% to 10%, but also a lookalike audience based on your customer database. A lookalike audience based on your website. Visitors like all sorts of different lookalike audiences, but also test them against cold audiences. Now here's one thing that you need to remember about lookalike audiences. So when we talk about audiences, we divide them into cold, warm and hot. And like I said before, a cold audience is an audience who has never heard of you before. They don't know you. They haven't had any interaction with your brand. So when you use a lookalike audience, you need to absolutely remember that these people have never heard of you. They are a cold audience. So even when I say a lookalike audience and like testing it versus a cold audience, what I mean by that is, well, your lookalike audience is based on people who have already had some interaction with you, but they're still cold. When I talk about a cold audience, I mean an audience based that you've built based on interests, they are both still cold, but we need to have some separation between them. So you need to treat them as a cold audience. Even though they've been sourced in a way from a warm audience. They look like a people who know, like and trust you, but you still need to engage in the process of building a relationship with them. They don't know you yet, even though they are most likely interested in what you have to offer. So hopefully that makes sense. Now, how can you use a lookalike audience in your ads? Well, firstly, use them to grow your list. That's what I would use them for. So use them to grow your list by setting up an ad to promote your free download or your free webinar or whatever you got free. So you can set up ads to a lookalike audience to promote your freebie. To build your list and to get extra specific, I sometimes use some hacks by layering the audience. So the way I do this is by using a lookalike audience and then adding in specific interests or even other options to further narrow down the audience. You don't have to like, you really don't have to. You can now, in a way, cast a little bit wider in Facebook. Facebook knows so much about us now that a lot of the time they actually get it right. We don't have to press that many buttons anymore. So start experimenting with lookalike audiences, but do it in strategic way and see what it can do for your business. We still use lookalike audiences a lot in my clients ads, so start playing with it. Just remember, it's a cold audience and try different ones. I know once upon a time everyone was saying, don't use anything that's broader than 1%. That has changed a lot. So I would say test it. Go and have a play with it. Because everything and every single business is different. We need to absolutely test everything. And at some point you might say, okay, well, past 3% doesn't work for my business. So you might go, I'm only going to use lookalike audiences that fall between the zero to 3%, but you don't know that until you test it. Whereas I have clients we can use all the way up to 10% of the lookalike audiences. So have a play with it. Test it if you have no idea what to do or how to do this, and you're really keen to learn more about Facebook ads because they are such an amazing tool to grow your list, to sell out more of your courses, to have launches, to attract new clients. 

So if you're keen to learn more and you want to know how to use it to sell more of your online courses, please go and check out my free masterclass because I have a free masterclass on how to sell more of your online courses with meta ads. So Facebook and Instagram ads. And to get to the masterclass, go to biancamckenzie.com/masterclass. I'll also include this link in the show notes. So go and have a look at how you can actually use Facebook ads to sell more of your courses, and one of those pieces is lookalike ads. Anyway, that is it. I have a few more minutes before I have to dash on the school. 

I really, really love helping you with your marketing, so if this was helpful, tune in again next week because I have way more tips for you on Facebook ads, marketing, all sorts of things. Thank you so much for joining me. And remember, if you're ready to take your business to the next level with Facebook and Instagram ads, make sure that you visit newschoolofmarketing.com to download practical, free resources. Subscribe to the podcast so that you never miss an episode. And remember, I can't wait to go on this journey with you. Until next time, take care. And don't forget, market your business every day.