What if your top customer had a clone? They’d probably be at the top of your prospects list since you know their pain points and the exact way to gain their business.
Many refer to this as lookalike modeling.
Lookalike modeling is a marketing effort to find individuals who are showing similar behaviors or acting like your target audience. Below we list the top four questions you should ask before considering a lookalike model for your business.
What Is Lookalike Modeling?
The first question when considering lookalike modeling is, “What even is it?”
Most define lookalike modeling as an advanced analytics methodology that can be leveraged to identify and acquire potential customers who show extremely similar behaviors and characteristics as your existing customers.
Lookalike modeling relies heavily on algorithms and machine learning techniques to analyze customer behavior and buying patterns. It then uses those insights to find those with similar attributes. Some say it’s one of the best approaches to ensure your marketing dollars are being used effectively.
This use of analytics can help businesses because it’s likely those identified as “lookalikes” will turn into loyal customers. Even more, targeting lookalikes can help your business better optimize campaign budgets and improve marketing effectiveness by polishing your existing strategies.
How Does Lookalike Modeling Support Marketing Efforts?
One of the first steps in every business strategy is identifying your ideal customer profile (ICP). While it can be difficult at first and may take some trial and error to nail down the perfect persona, once you do finally find them, never let them go.
Nurturing and maintaining relationships with those that match your ICP will help you retain customers and keep their loyalty. Alongside those relationship-building efforts, continue finding individuals who think or act like them—this is where lookalike modeling comes into play.
Lookalike modeling helps grow your reach, giving you a much larger pool of potential customers (AKA a recipe for success). This tool helps marketers seek audiences with behaviors that equal those of your ICP which gives you a greater chance of converting them. Further marketing benefits include:
- Improving lead generation.
- Reducing marketing spend.
- Enabling more accurate targeting.
- Better understanding your customers.
- Increasing conversions.
- Boosting brand awareness.
How Do You Build a Lookalike Model?
Lookalike modeling works using a combination of data, algorithms and machine learning. The process is typically carried out through a data management platform (DMP) and requires three key steps:
- Collect audience data.
Without any historic data on your existing target audience, there’s no way to build out lookalike modeling. Start by collecting a wide range of audience data—from your own channels and third-party sources such as websites and surveys. Remember: The more data you have collected, the more accurate the lookalike model will be. - Define audience attributes and behaviors.
Next, define your most engaged, profitable customers or core audience. Consider attributes and behaviors like location, purchase history, frequency and quantity of purchase, browsing history, and interest shown in a specific product. The more strict you are in defining these attributes, the better your chances of finding good quality prospects. - Generate your lookalike audience.
Once you have decided on the attributes and behaviors of your core audience, an algorithm is applied to find people that match. Users are then scored on an individual level based on their similarity to the core audience. The highest scoring profiles become your lookalike audiences.
*Tip: To ensure your marketing efforts aren’t identical to your competitors’, consider what uncharted datasets you could dig into to build better lookalike audiences.
Is Lookalike Modeling a Continuous Effort?
Yes—and it should be! Lookalike modeling is not something you do once and walk away from. It’s important to refresh your models regularly so you can best maintain the information and insights you collected while building your lookalikes.
In fact, machines learn best (and more) the longer your models are run. This gives them ample time and opportunity to adjust your defined lookalikes for 99% accuracy.
Additionally, as your business grows, there will be more data to analyze and at some point your target audience may shift. Continuing to collect fresh data on your key demographic is important to utilize lookalike modeling to the best of its ability.
Get Started With Lookalike Modeling Today
As soon as you’re ready to launch a lookalike modeling campaign, our team of experts is ready to support you. Contact us today to learn how we can help you generate more leads.
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