In the old days he might have told us to get lost, but today you can assure him
that you’re not actually going to contact a single customer on his list. You
just want to find out how old they are, and what pages they liked on
Facebook.
We don’t know how that would really work out, but let's say that the dealer
agrees to sell you a list of 5,000 people for $250. All he is going to provide
you is their name and email address.
It doesn’t sound like much – but that’s all Facebook needs to get to work.
When you upload the data, Facebook is going to use its system and all the
data it has collected over the years to compile a list of customers – that didn’t
buy from your dealer on the other edge of town – but who are similar in
every respect. That is your lookalike audience.
When you advertise to a lookalike audience, that is as if you have optimized
your ad campaigns by running them for the past 6 months. You’ll find that
the performance of ads that use a lookalike audience outstrip those that don’t
by a massive margin. These will be your highest value customers.
You don’t have to buy or borrow a database of people to create a lookalike
audience. You can also create them from the data that you’re generating in
your own ad campaigns. You can use people who’ve liked your Facebook
page to create a Lookalike audience. Although that will be your data alone, it
takes time. From my experience, I’d recommend 5,000 people to create a
good lookalike audience. You need to reach a certain threshold in order to be
able to get enough data on demographics etc. in order to create a new list of
similar people that will be responsive.
Another way you can create your own lookalike audience is to generate an
email list using traffic campaigns. If you’ve had an online presence, you
might already have one. So if you’ve been advertising your Chevy trucks
online outside Facebook for years until now, and you’ve collected thousands
of names and email addresses on your signup form, then you already have a
base list of people with characteristics that are going to be associated with
people who are interested in buying Chevy trucks. You can upload that list to
Facebook, and have it gone to work to create an audience that you can then
hit with Facebook ads. Some services, like Mail Chimp, have been set up so
that you can simply import directly from Mail Chimp to Facebook.