All retailers hope and dream that their best customers will become frequent and even regular shoppers because well…they are the retailer’s best customers. While their best customers may already be frequent visitors, this is not always the case. If only you could clone your best customers. More of them would surely increase your ROI. Well, that cloning thing’s not going to happen soon. So, while science works out the kinks in the cloning process, retailers do have another route to find near-clones of their best customers – utilizing various database management tools to find lookalike audiences.
For retailers to find customer lookalikes, they need to first dig deep into their existing customer database and analyze who their best customers are. Determining exactly who the best customers are will be based on different factors for different retailers. For some, it’s lifetime value. For others, it’s frequency of shopping or it could be size of purchases.
Once you’ve analyzed the data and really understand who your best customers are, you will be able to break them down into customer segments defined by commonalities and traits. These could include household income, age, marital status, presence of kids, lifestages, and many other data points. Each identified customer segment will then be able to help retailers begin marketing to their best customer lookalikes – prospects who match the profiles of their best customers. A match made in database heaven!
However, doing database management on a retailer’s existing customer data is not the only tool that can help to identify lookalike audiences.
The social media giant is like the Neil Clark Warren of matching retailers with their ideal customers using Lookalike Audiences. This is an amazing tool to help retailers find new customers via digital and social channels. There is not one, not two, but three different paths retailers can take with the tool to discover customer lookalikes.
- Custom Audiences: Using the Custom Audiences tool, retailers are able to upload a list to Facebook of their existing customers (this could be your list of best customers culled from your database) and utilize Lookalike Audiences to target prospects that resemble customers from that list.
- Website visitors: Retailers are able to install a Facebook pixel on their website. Using this helps them to target lookalikes based on people who have visited specific pages on their site.
- Page fans: Lookalike Audiences is able to determine prospects based on people that like a retailer’s Facebook page and serve up marketing to them.
Facebook will never match the greatness of eHarmony in helping people find their soulmates, but retailers will have no problem finding matches of their best customers using the Lookalike Audiences tool. One of the three paths are bound to help you achieve finding your best lookalikes. No clones needed.
Twitter offers a tool similar to Facebook’s Lookalike Audiences, called Tailored Audiences. The tool has a comparable method to finding someone who has already expressed interest in a retailer and is more likely to be targeted as a lookalike. But the two tools are not clones of each other. There are some differences between each of them. Twitter’s Tailored Audiences also offers three different paths for retailers to utilize when targeting lookalikes.
- Lists: This path (similar to Facebook Custom Audiences) gives the retailer the ability to use their own lists to target specific users. They are able to either target their existing customers by uploading an email address list or Twitter handles to target relevant lookalikes and influencers.
- Web: Tailored Audiences gives retailers different ways to target people that have visited their website. They are able to either collect the data using Twitter’s website tag (this is available through Twitter Ads), or retailers are able to utilize Twitter’s Official Partner Program.
- Mobile apps: Retailers are able to reach a target audience, and further lookalikes, who have taken action in their mobile app, such as install or sign up. Data of who is using the app is then collected by the retailer with conversion tracking.
Having multiple options to target lookalike audiences through the social network helps retailers really hone in on a target that best fits their needs as a business. Like a dating site for retailers where they get to choose which options they want to be matched with, giving you the best possibility for a perfect match.
Whichever database management route you choose to target a lookalike audience (existing customer database, social networks, digital channels, all of the above.), it will benefit you by bringing in more customers who look and act like your best customers. The big question to answer is, “How will finding lookalikes of your best customers prove to be a success and help to increase your retail marketing ROI?” The answer is simple.
- Lookalike marketing extends the reach and frequency of the retailer’s message.
- Lookalike targeting allows retailers to hone in on prospects who share many qualities of their existing customers. It’s not only an efficient way to target, but it can yield sales results and also give retailers the ability to gain more customer information in their database.
- Advertisers know that a retailer’s existing customers are their best customers. So lookalikes are the next best thing! Until that clone thing gets perfected, anyway.
Finding lookalikes is just one way using your data can help your bottom line. In future posts, we’ll explore other ways database management can increase ROI for retailers. If you have any questions in the meantime, just give Yaffe a shout or leave a comment below.