5 Ways to Take Advantage of Facebook's Strongest Audience Type
Targeting is one of the most important pieces of any successful advertising campaign. At Bamboo, we are constantly testing audiences to find which will drive the best performance. Time after time, we find that we come back to Facebook Lookalike audiences to achieve this.
Lookalike audiences are composed of people who share the same basic characteristics of your current customers. You can build Lookalike audiences from a multitude of sources, including either a customer list, pixel data, mobile app data, or fans of your Facebook Page.
Lookalikes have many layers. This makes them powerful, but also often more difficult to operate unless you’re experienced. We’re here to guide you through best practices we’ve learned after years of using them.
Lookalikes are Consistently the Best Performing Audience Type
After analyzing tens of millions of dollars in ad spend, here’s how performance stacks up by audience type on Facebook:
As a result, we find that Lookalikes frequently make up >60% of overall spend in our campaigns.Though it’s fun to be creative in researching targeting options - from “people recently engaged” to people who are fans of the Starbucks page - the results suggest that keeping Lookalikes front and center is best practice in most cases.
Lookalike Sources: The Possibilities are (nearly) Endless
The source is the original audience group you are attempting to replicate through building a Lookalike audience.
Imagine you have an app that lets people book restaurants. You could use sources to generate Lookalikes such as:
The possibilities are nearly endless. Facebook supports source files that contain over a dozen different types of data, from e-mail to mobile ad ID, which it will try and “match” on. The best practice is to include as many pieces of information as possible to improve match rates. Average match rates vary, but you should aim for at least 50% match.
Lookalike Sources: Which to Choose?
The importance of the source of Lookalikes cannot be overemphasized. Lookalikes are, after all, the direct result of your input.
Which type of Lookalike source should you prioritize? After looking at thousands of campaigns with hundreds of Lookalike options, here are the top source types we identified, with examples from our fictional restaurant app:
Lookalike Sizes: 1% Truly is Best
When you make a Lookalike, you must choose a percent tier. The options range from 1% to 10%.
A 1% Lookalike is telling Facebook to find the top 1% of people on Facebook that look like your original source file. This should result in the most relevant audience, but it also creates the smallest Lookalike size. A 10% Lookalike, on the other hand, is larger but potentially less relevant.
Which Lookalike size is best? After thousands of Lookalike campaigns, we found that 1% or 2% Lookalike sizes drove the best CPA performance 67% of the time. Larger Lookalikes have a place in allowing you to reach broader audiences and spend more easily, but they shouldn’t be relied upon to drive the best performance.
Lookalikes are Always Improving
As powerful as they already are, Facebook isn’t content with the current state of Lookalike audiences. They are relentlessly rolling out new updates to increase adoption and allow for more control. This is, after all, one of the most important parts of their entire advertising platform. Here’s what’s new lately:
At Bamboo, we trust Lookalike audiences to increase the reach and accuracy of our campaigns. We have seen massive success resulting from this targeting type and we encourage you to see how it can impact your ad campaigns.
Here’s a recap of the 5 tactics we recommend to fully take advantage of Lookalike audiences:
1. Lead with Lookalikes - In most cases, the majority of your budget should go towards Lookalike audiences.
2. Test through multiple sources - With countless variations available, spend time pulling in audiences from your customer lists, fan pages, and more to see which performs best
3. Prioritize sources built around top purchasers - More often than not, the source list of your best current customers will produce the best Lookalike
4. Stick to 1-2% Lookalikes for best performance - While larger % tiers offer greater reach, the quality of these audiences will likely be less than smaller 1% or 2% segments.
5. Follow along and test out new Lookalike updates early - Adopting new Lookalike updates can pay off and give you a leg up
In 2004, Mark Zuckerberg unleashed the beast that is Facebook from his Harvard dorm room. Today, Facebook has over 1.8 billion monthly active users and millions of businesses on the platform. With this incredible scale, Facebook has found itself in the position of being the dominant player in connecting people to businesses via advertising campaigns.
When comparing Facebook to more traditional advertising channels, its strengths are immediately clear: Facebook is cheap to advertise on, provides a wide array of creative types, allows for A/B testing on audiences and creatives, contains advanced targeting techniques, and has an incredible reach that defies geographical borders.
While Facebook now reigns as a king of advertising, it has undergone several major changes along the way. How did it get here, and overcome innumerable obstacles along the way? Let’s take a look…
Here is a timeline illustrating some milestones leading to Facebook’s massive success as an ad platform:
Facebook Begins Its Ad Takeover: 2004 - 2006
Facebook has profited off the idea of selling ads since its inception. When Facebook only functioned as a way to connect college students, it sold Flyers (essentially ad slots) to students promoting parties or other campus activities for a small price. Advertising proved Facebook’s primary source of revenue and kept the company afloat even in its earliest days.
When Facebook first attempted to sell ad space, it had 70,000 total users (55% from Ivy-League schools and the remaining 45% from other schools) and it sold itself on the immense amount of purchasing power college students held.
With its limited reach, Facebook also could only target on a narrow scope. However, this was revolutionary compared to the targeting abilities of traditional media such as print or television. For example, advertisers could target by college, degree type, courses taken, class year, age, gender, dorm, personal interests and other parameters relevant to the segmentation of college students.
During this end of this time frame, Microsoft became the exclusive provider of all Facebook advertising, this includes banner ads and sponsored links.
Facebook Begins Ramping Up: 2007 - 2009
During these years, Facebook went through a few major changes. For one, the application is now available on mobile, something that will add fuel to the fire in coming years. Then next, businesses are able to create pages to promote themselves on the platform through buying advertisements. This will prove to be a significant step in Facebook’s evolution to become more business-friendly.
With businesses beginning to advertise on Facebook, Facebook unleashes a first edition of its audience targeting tool and ads manager. Now, businesses can use targeting to reach their preferred audience and navigate Facebook ads on their own with a self-service offering.
Facebook Tightens Its Grip in The Mobile Ad Space: 2010 - 2013
Facebook now introduces its mobile app, which allows users to access the service even more readily before. With this will come the introduction of mobile ads, a robust addition to Facebook’s ad tool. These ads appear natively within the News Feed to avoid clutter and noise (another huge milestone for FB ads).
Mobile ad revenue saw exponential growth from its beginning in 2012 and by 2016, mobile contributes 84% of total ad revenue. By concentrating on a mobile-first basis early on, Facebook sets the standard for mobile initiatives.
The importance of this time cannot be underestimated. Facebook was able to not only weather, but actually excel, through a seismic shift in consumer behavior from web to mobile.
Facebook’s new “Social Graph” and cookie-based targeting allow marketers to find potential customers. This gave way to Custom Audiences, a feature enabling marketers to penetrate specific ads to a relevant audience, as well as Lookalike Audiences (people who share characteristics with your Custom Audience). This is where Facebook started fine-tuning its targeting and became a threat to traditional forms of advertising.
In addition to Facebook’s tools for creating audiences, now advertisers can sync their existing customer information to Facebook to increase data and better target custom audiences.
Facebook Continues to Control the Market: 2014 - 2017
This is where Facebook starts refining their existing ad platform. Sponsored stories are completely removed from Facebook as it continues to streamline content and better target audiences. Ads start to blend into organic content as the platform matures.
New features such as carousel ads, lead ads, group ads, and countless others are now available to advertisers. With a wider array of tools, advertisers now have a diversified approach on the platform.
Facebook also rolls out Facebook Audience Network, or FAN. FAN enables advertisers to expand its campaign’s reach to other mobile apps. It signals Facebook trying to host ads beyond its own site and apps. In face, Facebook claimed FAN the “second-biggest mobile-ad network and the biggest native-ad network” with $1 billion in revenue.
With Facebook ads holding strong, Facebook also unleashes Instagram ads during this time frame, which allows advertisers another unique platform to use in targeting audiences and testing creative.
Our Predictions for 2017 and Beyond
We don’t know exactly what Facebook will roll out in coming months or years, but we predict it will include these four themes:
1. Focus on locality: Our timeline shows as Facebook ads progress, audience targeting becomes more granular. In becoming the best platform for creating and targeting audiences, we predict that Facebook will zoom in on local targeting tactics.
2. Increased automation: Using bots to chat with potential customers will allow businesses to increase communication without fatiguing employees. This will allow brands to gather more information about who their leads are/what questions they have and target their advertising accordingly.
3. A “Shop Now” feature: With many people consulting Facebook for new products and trends, we think it will be natural for a “Shop Now” CTA to be featured. This will take Facebook advertising from just a place of consideration to a place of purchase.
4. Going Live: With Facebook rolling out its live stream feature, we predict live advertising won’t be far behind. This will enable brands to engage with their audience in a unique and real way. In fact, Facebook has already started testing real-time advertising. This article on Digiday explains how Facebook is making efforts for brands and publishers to start going live with their campaigns.
Let us know your thoughts on our predictions and comment with predictions of your own!
With a smaller audience than both Facebook and Instagram, it’s easy for Twitter to be overlooked at first by marketers. But, when one look beyond size, Twitter is a tremendous opportunity for those who know where to focus. Since Twitter won’t win on scale, their team has continued to to invest in product and ads offerings around what make the platform unique.
In many ways, events are a perfect representation of this. From awards shows like The Golden Globes to the spirited battles of March Madness, events are when Twitter most comes alive.
Not only are events exciting for Twitter users, but they’ve also proved to be incredible opportunities time and time again for performance advertisers. In fact, we’re going so far as to say they’re amongst the strongest offerings right now that differentiate Twitter from other platforms. And, we have the performance to prove it.
Case Study #1: Event Targeting and Political Buzz
Our team was very excited to test Twitter event targeting during one of the biggest events of 2016, The Presidential Election. Specifically, Twitter offered specific event targeting options around major milestones in the campaigns, including each Presidential Debate night. This was the perfect match for one of our media clients.
With everyone in the United States seemingly turning to Twitter to follow each word of each debate, we saw engagement and audience sizes grow significantly.
Compared to non-event targeting during the same time, our media client saw event targeting drive the following gains:
Case Study #2: Event Targeting and Sports Mania
Sports is another vertical in which we found success with Twitter event targeting. Twitter offers sports targeting ranging from global events like the Olympics to more targeted events like specific NFL games.
We tested dozens of sports event options with our sports client, a mobile ticketing app.
Compared to non-event targeting campaigns, our sports client saw event targeting drive the following gains:
How Do I Create a Successful Event Targeting Campaign?
Like any ad campaign, there are a few best practices to follow that yield maximum results.
1. Select your audience: Creating the perfect audience begins with research. Before you can start building an event targeting campaign, you must build an audience profile with basic demographics in the Twitter ad account.
2. Match your audience to an event: For an event targeting campaign to be most impactful, you must choose an event that appeals and resonates with your audience. In Twitter Ads, you can delve deeper into the demographics of people talking about about a specific event. For example, here is St. Patrick’s Day audience summary for 2016. It displays relevant information advertisers can use for future St. Patrick’s Day targeting.
3. Use event-specific hashtags and keywords: Use trending words and phrases to appeal to your audience. In Twitter Events, you can see what other people have been saying about your event and use those insights to tailor your campaign.
4. Go live: A successful events campaign relies on more than just creating the right audience. Use captivating creative, effective copy and remember to tag relevant people or brands when going live.
There is huge opportunity to make a splash on Twitter using event targeting in March. Whether you’re targeting foodies, theater goers or recent college grads, events are always happening!
Here are a list of a few events going on this March:
Austin Food and Wine Festival
Beauty and the Beast Movie Premiere
Chelsea Flower Show
Paris Fashion Week Spring 2017
UK Budget 2017
According to eMarketer, mobile advertising is on track to hit more than $195 Billion annually by 2019 - up from just over $19B in 2013 - it is obvious that the mobile has gone mainstream. That is no surprise given that the average U.S. adult now spends more than three hours on their mobile device per day. If you are not reaching customers on their mobile device, you’re missing a special opportunity.
The vast majority of time that people spend on their mobile devices is being spent within apps.
To fight for a slice of those three hours per day that people are using their device, developers have created more have made more than two million mobile apps for the Apple App Store and more than 2.2 million for Google Play. Once the apps are made, the focus of developers shifts to promotion and driving awareness. As a result, mobile app advertising budgets have exploded.
Want to pay for mobile app installs? There are now millions of publishers, networks, supply-side platforms, demand-side platforms, ad:tech vendors, and agencies all fighting for your budget and they can all deliver your desired result.
Here's the secret: Of the many mobile ad agencies, only a handful are worth investment.
With around $100MM in mobile app advertising budget managed to-date, we’ve learned a lot. We are now experts in budget allocation on mobile. In this Whitepaper, we hope to give you the tools you need to make a smart mobile advertising agency hiring decision.
One of the most important decisions a mobile app developer will make in their business is how and where they choose to promote their app. When choosing an advertising agency partner, that partner will quite literally change the trajectory and outcome of your business. We want to make sure that change is a good one, so we’re sharing a questionnaire that you should give to every mobile advertising agency before you choose to hire them!
Mobile Advertising Agency Questionnaire
2. Are you mobile-first?
For many traditional “one stop shop” media agencies, mobile is a shiny new toy. They want a piece of that budget and sell accordingly. Unfortunately, most of them are all bark and no bite. They will be learning how to do mobile advertising well on your dollar. Make sure to choose an agency partner that has managed mobile campaigns at scale and has strong relationships in the industry that they can leverage on your behalf from the start.
3. What verticals do you have expertise in?
Mobile experience is critical in a partner but mobile is a platform, not a vertical. If you are trying to grow the customer base of a finance app and you’re speaking with a partner who works primarily with games, they will likely waste your money while learning how to buy ads for finance apps. Make sure you partner with someone who knows your vertical well and again, can leverage their expertise on your behalf from the start.
4. What networks would you recommend that we buy on?
In the early days of mobile, the ad network landscape was very fragmented. Advertising at scale on mobile required the active management of many partners, the building out robust cross-channel reporting, and a technical integration with each. That is a bygone era. Facebook and Google now make up ~67% of all global mobile advertising spend. With this shift from many networks to few, the expertise required to be successful has changed quite dramatically as well.
If a mobile advertising agency is pitching you on “managing all of the networks for you” today, take that pitch with a grain of salt. If the agency has proven expertise in Facebook and/or Google at scale for mobile products in your vertical, trust that you’ll be able to easily spend $1MM+ per month with better ROI than you’ll see with the “organizing complexity” crowd.
If they specialize in mobile display (or anything that isn’t paid social and/or paid search), you should find a partner who is great at paid social and/or paid search first since it’s higher upside and typically higher ROI as well. The best mobile advertisers typically separate the mobile display team, the mobile + paid social team, and the mobile + paid search team, regardless of whether those teams are agencies or in-house staff.
5. What “MMP” do you recommend that we use?
Teams who truly understand how to do high ROI mobile advertising know how to do mobile attribution effectively. We use the term “MMP” interchangeable for Mobile Measurement Partner and by Mobile Measurement Partner, we always mean a 3rd party mobile attribution provider.
Here is a list of providers that are an acceptable answer to the MMP question today (organized alphabetically so we don’t play favorites and please let us know if we’re missing any!):
If you hear any of the following responses, we recommend that you run. Fast.
These responses aren’t necessarily bad ones if your question is “What analytics provider do you recommend?” but they don’t do the attribution necessary for running paid mobile app install campaigns at scale. They are mosting used interchangeably with the list above.
Bonus points if they mention the list we recommend above and also call out one of the mobile Data Management / SDK management platforms because they work quite well and reduce advertiser dependencies if they decide to switch providers:
6. How much does your biggest client spend per month with you?
If you are an advertiser hoping to spend $10K per month and the agency that is pitching you says their biggest client is spending $1M+ per month with them, you probably want to find another option as you won’t be a priority for their team.
The inverse of this is also true. Don’t hire an agency to spend $1M+ per month that doesn’t do it actively with other clients. Success at scale is a specialization in itself.
7. What do you think our cost per install will be?
This is a great question to ask because it’s a trick question. A good mobile agency should answer with, “Who cares?”. Mobile app installs are one of the first steps in a funnel that should generate revenue and then a long-term customer relationship. The latter two are significantly more important and what your agency should be optimizing for. That being said, good mobile agencies should be able to give you cost per install ranges that they see in your vertical coupled with a caveat that cost per install shouldn’t be the main KPI.
8. May I interview my Account Manager?
It’s critical that you work with an Account Manager that not only meshes with your in-house team, but also one that you know has the expertise needed to add value. Interview your potential Account Manager with the same questionnaire that we’ve outlined here as you might be being sold by an expert even though the agency plans to give you a not-so-expert Account Manager. If you allow it, the not-so-expert Account Manager may be learning on your dollar.
9. May I speak with a Client Reference?
Asking to speak with a client reference is one of the most valuable things you can do while vetting an agency partner. Try and ask for a reference from a client that your potential Account Manager is actively working with as well. If the client is a well-respected mobile advertiser and they like their service quality, it’s likely you will to. Bonus points if they advertise in a similar vertical to you!
10. Why should we choose you vs. hiring in-house?
Strong mobile agency partners know whether or not their value outweighs an in-house resource. They should be able to quantify this in tangible terms. You should also look for a partner that aims to augment your in-house efforts and be a true partner vs. thinking of themselves as an alternative to your in-house teams. The largest scale mobile advertisers typically have both an agency partner and an in-house team.
11. Why do you specialize in mobile?
The best mobile advertising agencies are enchanted by the possibilities that mobile grants them and that passion will work on your behalf every day. If they lack that passion, you will lose out on the halo effect that comes from it.
At Bamboo, we love what we do because we can create truly personalized relationships with billions of potential customers. Never in history have we been able to market directly to an individual customer in such a personalized way at scale. We covet the opportunity to connect with customers this way.
At Bamboo, we might get a little too excited about seeing ads in our own social feeds. They give us a chance to understand what tactics other companies are employing for their ads, and give us inspiration for our own campaigns. In this post, we decided to flip the script and give credit to some of our favorite non-Bamboo ads on Instagram!
After monitoring thousands of Instagram ads over the past few months, here are 10 that stood out:
1. Compare A New Behavior to a Familiar Behavior - Retale
What we love: Though Retale is a digital ad and coupon app, they understood that their audience may still better recognize a physical representation of a weekly circular. This familiar imagery draws the audience in, and only then connects the concept to their app.
2. Show Your Product in Action - QuickBooks
What we love: Rather than trying to explain how easy it is to take photos of receipts, QuickBooks simply shows it in a very tangible way. The strong copy below mentioning thousands saved on average doesn't hurt, either.
3. Build a Theme Around Your Products - Amazon
What we love: During the holidays, Amazon themed a campaign the “12 Days of Deals” to attract customers. This theme gives the ad a sense of organization, rather than being a random collection of product shots.
4. Feature High-Profile Brands - Poshmark
What we love: Everyone recognizes the Nike swoosh. Here, Poshmark leverages a more well-known brand than themselves (Nike) to draw attention and ultimately drive a conversion. While there is no text, we know from the copy that Poshmark is an e-commerce service where users can purchase well-known products for a discounted price.
5. Include Powerful Text - Getswitch
What we love: The color, font and copy of the text stands out and uses a strong CTA to inspire viewers. Changing jobs is no small feat, so the boldness of this ad from Switch is appropriate.
6. Display Real Interfaces - Lifesum
What we love: This ad features a sneak peek into LifeSum's interface. This ad also impressed us by positioning the device in a relevant background - a gym setting.
7. Showcase A Credible Quote - MATCHCo
What we love: Utilizing a quote from a reputable source such as Good Morning America establishes credibility and immediately draws attention. Not only does MATCHCo use the quote as the focal point, but it keeps the Good Morning America font and branding to further its purpose.
8. Use an Animation - Hiponcho
What we love: In a sea of images and text, animation can be a powerful way of differentiating your product as Poncho demonstrates here.
9. Highlight a Compelling Offer - CupsApp
What we love: CupsApp pairs a strong visual (pleasant coffeeshop environment) with a compelling offer. If they wanted to go one step further, they could add in copy or a sub-headline with an expiration date for the offer to add urgency.
10. Include a Diagram - Albert
What we love: Playful, yet informative, this diagram addresses the common problem of complex financial advice. Given that Albert is a finance app, the use of diagrams is especially fitting.
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