Terms

Lookalike Audiences

A lookalike audience is a group of potential new customers, identified by an advertising platform's algorithm, who share similar characteristics, interests, and behaviors with a business's existing customers. Advertisers provide a source audience, such as a list of their best customers or page followers, which the platform analyzes to find common attributes. The platform then builds a new, larger audience of people who are statistically more likely to be interested in the business, making targeting more data-driven and less based on assumptions.

Benefits of Using Lookalike Audiences

Lookalike audiences offer a powerful way to scale customer acquisition efforts efficiently. By leveraging platform algorithms, marketers can move beyond guesswork and connect with high-potential users. This data-driven approach yields several key advantages for campaign performance and growth.

  • Targeting: Reach new, highly relevant audiences who mirror your best customers.
  • Efficiency: Save time and resources by automating the audience discovery process.
  • Cost: Lower customer acquisition costs and reduce wasted ad spend.
  • Scale: Expand your reach to find new potential customers you might not otherwise discover.
  • Performance: Generate higher-quality leads and improve overall campaign conversion rates.

How to Create Lookalike Audiences

This is how you can create a lookalike audience for your campaigns.

  1. Select a high-quality source audience, like your best customers, website visitors, or page followers.
  2. Choose your target location and the desired audience size, typically a percentage from 1-10%.
  3. The platform’s algorithm will then analyze your source to find new people with similar traits.
  4. Launch your ad campaign to this new audience and monitor its performance for future refinements.

Lookalike Audiences vs. Custom Audiences

While both are powerful targeting tools, they serve distinct strategic purposes in digital advertising.

  • Lookalike Audiences are algorithmically generated groups of new users who mirror your best customers. They are ideal for expanding reach and acquiring new leads, making them valuable for enterprises and mid-market companies focused on growth. However, their effectiveness depends entirely on the quality of the source data.
  • Custom Audiences consist of people who have already interacted with your business, such as existing customers or website visitors. This allows for highly targeted re-engagement and nurturing campaigns. Their main limitation is that they don't reach new prospects, making them best for retention-focused strategies.

Best Practices for Lookalike Audiences

To maximize the effectiveness of your lookalike campaigns, it's crucial to follow established best practices. These guidelines help ensure you're reaching the most relevant new users while optimizing your ad spend and improving overall performance.

  • Quality: Use a high-quality source audience, like your best customers, to give the algorithm strong, relevant data to model from.
  • Size: Test different audience sizes, from a narrow 1% match for high similarity to a broader 10% for greater reach.
  • Refinement: Regularly update your source lists and monitor performance to avoid audience overlap and maintain campaign efficiency.

Common Mistakes with Lookalike Audiences

Marketers often make avoidable errors that undermine their lookalike campaigns and waste ad spend.

  • Source: Using low-quality or outdated source data that misleads the algorithm.
  • Sizing: Selecting an audience size that is too broad, sacrificing relevance for reach.
  • Overlap: Failing to exclude existing audiences, leading to duplicated efforts and mixed messaging.

Frequently Asked Questions about Lookalike Audiences

How long does it take to create a lookalike audience?

Creation time varies by platform but typically takes between 6 to 24 hours. The algorithm needs time to process your source data and identify new users who match the specified characteristics, so it's rarely an instantaneous process.

Can I use the same lookalike audience across different ad platforms?

No, lookalike audiences are platform-specific and cannot be transferred. You must create a new lookalike audience natively on each platform (e.g., Meta, Google, LinkedIn) using a relevant source list, as their algorithms and user data are distinct.

What is the ideal source audience size for a lookalike campaign?

While platforms have minimums, a high-quality source audience of 1,000 to 50,000 people is ideal. This provides enough data for the algorithm to find strong patterns without being too broad, ensuring the new audience is both relevant and scalable.

Other terms

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Unit Economics

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Data Appending

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Headless CMS

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Hot Leads

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LPI

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Digital Analytics

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Demand Forecasting

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Customer Relationship Marketing

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Average Order Value

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Average Order Value

D2C

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Sales Methodology

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Personalization

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Account

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Lead Magnet

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Workflow Automation

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Lead Generation Funnel

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Functional Testing

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Load Balancing

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Objection Handling

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Data Privacy

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Spiff

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Multi-threading

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Lead Response Time

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Buying Cycle

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Unique Value Proposition (UVP)

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Marketing Mix

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Sandboxes

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Lead Enrichment Tools

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CPM

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Marketing Automation

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Sales Qualified Lead

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Lead Management

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Lead Routing

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Buyer

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Sentiment Analysis

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On Target Earnings

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Firmographic Data

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Cloud-based CRM

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Customer Churn Rate

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Buyer Behavior

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Data Cleansing

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Cold Calling

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SFDC

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GTM

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Low-Hanging Fruit

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Sales Forecast Accuracy

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Database Management

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Email Personalization

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Robotic Process Automation

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Email Engagement

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Weighted Sales Pipeline

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Commission

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Contact Data

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Qualified Lead

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CRM Enrichment

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Messaging Strategy

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Landing Pages

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Payment Processors

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Smarketing

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Tokenization

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Sales Prospecting

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CRM Integration

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Adobe Analytics

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Sales and Marketing Alignment

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Lead List

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DMP

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Bad Leads

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Lead Velocity Rate

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SDK

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Sales Velocity

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Microservices

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Escalations

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Business-to-Business (B2B)

Learn about B2B, including what is it, its key elements, the benefits of B2B partnerships, the differences between B2B and B2C, and strategies for effective marketing.

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InMail Messages

LinkedIn InMail messages are a premium feature that lets you directly message any LinkedIn member, even if you're not connected to them.

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Dark Funnel

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Annual Recurring Revenue (ARR)

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Sales Coach

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CDP

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Objection

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Sales Presentation