Lookalike Audience
A target audience that platforms (Meta, Google, TikTok) create based on your existing customers' traits. 'Find people similar to my best 1,000 customers.' Expands acquisition beyond interest-based targeting.
In practice
A lookalike is the 'clone' of your best customers. Instead of relying on interest targeting that's a guess, you tell the platform: 'here are the customers who bought the most — find more like them.' The algorithm finds hidden patterns you can't spot manually.
Common misconception
'A 1% lookalike is always the best.' 1% is the most similar but small. 3-5% is less similar but larger — sometimes better performance due to volume. Always A/B test 1% vs 3% vs 5%. In smaller markets, a 3-5% audience often works better.
How to fix it
Lookalike not converting? (1) Check source quality — a lookalike from 100 purchases is weaker than one from 1,000. The source must be large and high-quality, (2) Check that the source is 'best customers,' not 'all customers,' (3) In Meta: a lookalike from a customer list beats one from website visitors, (4) Wait 2-4 weeks for the learning phase.
Example
Sports store: interest targeting (sports, fitness, running) — CAC $30. A 1% lookalike from the 500 most profitable customers — CAC $19. A lookalike from a 5,000-subscriber email list — CAC $23. The best-customers lookalike won.
Priority
Lookalike source priority: (1) customer purchase list (best), (2) high-value customers (LTV above average), (3) email subscribers, (4) website visitors. Always try a lookalike before relying solely on interest targeting.
Related terms
Keep learning. Metrics that touch the same area:
- eCommerce / Electronic CommerceMarketingAll business activity conducted online — showcasing products, ordering, payment, shipping, and post-sale service. The backbone of every online store.
- CPC – Cost Per ClickMarketingThe price an advertiser pays each time a visitor clicks the ad. Influenced by competition, Quality Score, and landing page relevance.
- CPM – Cost Per MilleMarketingThe cost of advertising per 1,000 ad impressions. A key metric in awareness-focused and brand-building campaigns.
- CPA – Cost Per AcquisitionMarketingThe amount it costs to get a customer to complete a desired action. A core profitability metric — if CPA exceeds gross profit, the campaign loses money.
- CAC – Customer Acquisition CostMarketingTotal marketing and sales spend divided by the number of new customers. Always compare to LTV. A healthy ratio: LTV at least 3x higher than CAC.
- ROAS – Return on Ad SpendMarketingRevenue generated divided by ad spend. A ROAS of 4 means $4 in revenue for every $1 spent on ads.
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