Marketing professionals, sales teams, and business owners are constantly chasing new audiences to target. This is only natural, as the more you grow your business and the more customers you reach, the greater your success. It is the core element of all business: the need to achieve stronger and greater consumer support.
But, let’s face it..it’s not a “piece of cake” targeting new audiences, especially when they are beyond who you normally encounter or engage with. There are a lot of unknowns in increasing your audience targeting size, and marketers and publishers need to evolve with the technology around them.
While Lookalike Modeling isn’t a term that is new to the marketing technology industry, it is still widely misunderstood. It is a tool that has been used by companies to expand their digital audiences while maintaining clear and relevant targeting practices. This piece will take a look into what Lookalike Modeling is, how it works, and why it is so important for advertising campaigns.
What is Lookalike Modeling?
If you are looking to increase your targeting efforts with high performing audiences, the answers don’t lie in a mass chain of random messaging to consumers who have zero interest in your product. Instead, your focus should lie on YOUR high performing audiences. What is it about your highest performing audiences that set them apart from the rest? Do they have common interests? Are they from the same geographic area? The best way to acquire new, high performing visitors is to focus on users who resemble your existing visitors, the users who have already shown an interest in your product or service.
Lookalike modeling is a process that utilizes machine learning to statistically analyze a given seed audience (already high performing audience), identifying the demographics, characteristics, and different combinations of those and other data points. New audiences are then created, and continually updated, composed of users that match these learned insights.
For example, let’s say your are hoping to target people who are more likely to click on your ad or watch your video. Lookalike modeling uses machine learning to find more users who will take that specific action. This means your campaigns can scale to reach more people, with a high engagement rate.
How does Lookalike Modeling work?
Let’s say you are a clothing brand looking to boost online purchases for an upcoming sale. The first step would be to place a pixel– a small segment of tracking code– on your purchase confirmation page. This will allow you to track the behaviors of purchasers– during the current sale– as they move throughout the web.
The demographic and behavioral data points of anyone who completes a sale and makes it to the confirmation page can be ingested into a DMP platform and analyzed to identify which behaviors and patterns are most common among the audiences. Once those customer characteristics and data points are identified, you can use them create your new seed audience and ultimately engage with an even greater target audience.
It’s a truly incredible process that uncovers the hidden attributes that can optimize your performance for future campaigns. Icing on the cake? It’s all done in a centralized platform.
Why Use Lookalike Modeling?
Well, I guess the question would be, “Why not”? As an advertiser, when consumers within a specific audience converts, it’s a fulfilling feeling. And while you want to hold on to that high performing target audience, you still want to ensure you are growing your brand following.
By using a lookalike modeling tool, it helps you to identify a larger pool of possible customers. You can use the tool to seek audiences with behaviors that match up to your target audience, and so you have a greater chance to convert them. It’s essentially the same as building a robust profile of existing customers, only you are doing it for the audiences you have yet to reach out to and engage with.
In summary, Lookalike Modeling offers marketers and publishers a valuable approach to reaching new or current consumers in a cost-effective way, ultimately helping companies to grow the scope and reach of their businesses. Why not take advantage of your already high performing audiences and increase your brand awareness? As the industry continues to look for new and innovative ways to reach new consumers, lookalike modeling will help marketers stay true to their core and use what they already know to improve campaign success.