What Is a Lookalike Audience?
Lookalike audiences are a targeting feature used in online advertising where an advertiser targets consumers who are similar to their existing customers.
Historically, identifying potential customers who were similar to a brand's existing customer base largely amounted to a time-consuming guessing game. The maturation of data engineering solved that riddle: By collecting and analyzing customer information, common characteristics among an advertiser's current customers are derived and used for finding people who match those characteristics in the larger pool of potential customers.
That exercise results in pinpointing new customers who are more likely to be interested in the advertiser's products or services, and thus most likely to convert.
Lookalike audiences can be culled from a number of sources. Some common lookalike types include:
- Customer file-based: created from the advertiser's customer data.
- Website visitors: created from the data of people who have visited the advertiser's website ( a pixel usually generates this data).
- Engagement-based: created from the data of people who have engaged with the advertiser's organic content.
- Conversion-based: created from the data of people who have completed a specific action (e.g. made a purchase (a pixel typically generates this, too)).
- Remarketing: created from the data of people who have interacted with the advertiser's ads in the past.
The lookalike-audience strategy is sometimes confused with another popular approach known as retargeting. The primary difference between the two: Retargeting targets people who have already interacted with the advertiser's website or ads with the intention of reminding those people of the advertiser's products or services and encouraging them to complete a specific action, such as making a purchase. A lookalike audience may include past, current, and/or future customers.
And then there’s the lookalike antithesis, audience suppression, a practice that excludes individuals from being targeted because they are already familiar with the brand or have previously engaged with its advertisements. Audience suppression is used to avoid wasting ad spend on individuals who are unlikely to convert, while lookalike audiences aim to find new potential customers. Both methods can be used together as part of a comprehensive digital advertising strategy to increase the efficiency and effectiveness of campaigns.
How Lookalike Audiences Work
Defining a lookalike audience begins with creating a seed audience to work with. Lookalike audiences work by using algorithms to analyze the characteristics and behaviors of an advertiser's existing customers — the seed audience — and then finding new people who are similar to those customers. The algorithms consider various factors such as demographics, interests, and online behaviors to identify similarities.
Once a lookalike audience has been created, the advertiser can use it to target their advertising to that new group of people. For example, if the seed audience is made up of people who have purchased a particular product, the advertiser can use a lookalike audience to find and target new people who are similar to those customers and thus likely to be interested in the same product.
Why Lookalike Audiences Are Important
Lookalike audiences can do wonders for a business’s growth and overall marketing and sales operation, including:
- Increasing reach: By targeting people who are similar to their existing customers, businesses can reach new audiences who not only have a propensity to convert but are also likely to influence those around them to do the same.
- Improving efficiency: Lookalike audiences can help businesses streamline their advertising spend by targeting people who are more likely to be interested in their products, reducing the cost of advertising and improving the return on investment. Simultaneously, businesses save time and resources through the process automation that lookalike audiences bring to the table.
- Enhancing targeting: Because lookalike audiences allow for targeted advertising based on similarities to existing customers, savvy businesses are able to implement more relevant and effective advertising.
- Expanding their customer base: By reaching new people who are similar to their existing customers, businesses can expand their customer base and grow their business.
Lookalike Audiences Examples
Part of the beauty of lookalike audiences is their viability across industries. To put this into real-world perspective, here are some hypothetical examples:
- E-commerce: An online clothing retailer creates a seed audience composed of consumers who have purchased their products in the past. The retailer then creates a lookalike audience based on that seed audience and targets them with advertising for similar clothing items.
- Travel: A travel agency builds a seed audience of customers who have recently visited their website, then creates a lookalike audience that it targets with ads for the upcoming season’s vacation packages.
- Beauty: A beauty brand generates a seed audience of people who have engaged with their social media posts at some point over the past 3 months. The company then creates a lookalike audience and targets them with ads for the skincare products featured in those posts.
- Finance: A bank creates a seed audience of customers who successfully applied for a loan over the past 12 months, then creates a lookalike audience and targets them with ads for credit card products.
- Fitness: A fitness business pulls together a seed audience of people who have visited their gym at least once over the past 6 months without becoming a member. The resulting lookalike audience is targeted with ads touting a limited-time membership discount promotion.
How to Build Your Lookalike Audience
To create an effective lookalike audience, follow these 8 steps:
1. Gather data: Collect data on your existing customers, such as demographics, interests, and online behaviors. Some resource to leverage:
- Customer lists
- Email lists
- Form respondents/responses
- Login pages
- Engaged users
- Website activity (usually generated by a pixel)
2. Create a seed audience: Use the data you have collected to create a seed audience of your existing customers. This seed audience will be used as the starting point for building your lookalike audience.
3. Choose a platform: Select a platform such as Snapchat that offers lookalike audience targeting.
4. Select target-audience size and similarity level: Decide on the size and similarity level of your target audience based on your advertising goals. The larger the audience size, the less targeted your lookalike audience becomes — a larger audience may reach more people, but may also include individuals who are not as similar to your target audience. We recommend starting with 1-10% and growing from there.
5. Build the lookalike audience: Use the data from your seed audience to build a new audience of people who are similar to your existing customers. The digital advertising platform will use machine learning algorithms to analyze the data and identify similarities.
6. Target your advertising: Once the lookalike audience has been built, use it to target your advertising.
7. Monitor, test, and refine: Continuously monitor the performance of your lookalike audience and make adjustments as necessary. Test and refine different aspects of your targeting such as the size, similarity level, and ad creative to find what works best. Optimize your lookalike audience over time to get the best results.
8. Use different lookalike audiences for different campaigns: Create separate lookalike audiences for specific advertising campaigns to target specific groups of people for whom those campaigns promise to be the most effective and relevant.
Lookalike audiences and Snapchat
You can develop your own lookalike audiences for Snapchat Ads. In fact, Snapchat offers the kinds of lookalike audiences mentioned at the beginning. Snapchat offers a quick, straightforward way to connect with Snapchatters through Snapchat Ads Manager.
- Select from three different lookalike options: Similarity, Balance, and Reach.
- Step through the process and Snapchat will do the work for you from there.