ReTargeter Blog

Navigating Facebook Advertising: Custom and Lookalike Audiences

In the past year, Facebook has ramped up its offerings for advertisers. Over the course of a year, we saw the launch of the Facebook Exchange, Custom Audiences, and most recently, Lookalike Audiences.

Here’s a breakdown of how marketers can leverage these highly compelling Facebook features:

Facebook Custom Audiences

As you may remember, Facebook formally launched Custom Audiences back in September 2012. This long awaited feature finally enables advertisers to target Sponsored Stories or Ads to users with whom they have previously engaged through partnerships with first-party and third-party data providers BlueKai, Axciom, Epsilon, and DataLogix. A powerful targeting tool, Custom Audiences provides advertisers with the ability to reach highly specific segments of their online and offline audience on Facebook. Brands are able to stay in front of their database and connect with past, current, and prospective clients on the social network with native Facebook advertisements.

Custom Audiences works by letting advertisers upload their customer databases and then matches those users to their Facebook Profiles using hashed email addresses or telephone numbers. Advertisers can develop creative that is targeted to these groups. For example, if one of your email lists contains people who attended a webinar, you can upload that list into Custom Audiences and serve creative that is specifically geared towards upcoming webinars or other relevant events. You can target dormant buyers with campaigns that will encourage them to return to your site.

The ability to reach your offline database online is not a new capability but with match rates sometimes reaching 95%, Facebook Custom Audiences provide a unique opportunity for advertisers to capitalize on their users’ social browsing.

Facebook Lookalike Audiences

Just last week, Facebook launched a global rollout of Lookalike Audiences. Building off of the Custom Audiences feature, this targeting tool finds audiences that “look like” the Custom Audience pool. In helping find people that are similar to existing customers, Lookalike Audiences puts brands in front of a larger, relevant audience, allowing them to reach new customers and grow their business.

Facebook offers two options for Lookalike Audiences campaign optimization: Similarity and Greater Reach. A Similarity match will generate an audience of the top 1% of people who are most similar to your custom audience in your selected country. Greater Reach will match the top 5% of people to your custom audience, which allows you to be in front of more people but the match will be slightly less precise.

According to Mashable, Facebook claims an online retail partner has seen a 56% lower cost-per-fan acquisition cost and a 94% lower cost per checkout with the use of Lookalike Audience targeting. The key to success with this feature, however, is a very large list in Custom Audiences. The more people available in your lists, the more information Facebook has to create a viable Lookalike audience.

Facebook Exchange

The Facebook Exchange, FBX, is Facebook’s real-time bidding platform. This platform brought retargeting to the social network and has proven to be a service with impressive results. What advertising on the Facebook Exchange allows you to do is stay in front of users who have already expressed interest in your brand.

FBX ad placement gives you the ability to target the right audience like never before. You can target based on previous site visits, a valuable insight to ensure you reach the right audience, or you can use Facebook’s traditional demographic info with Facebook Marketplace ads.


As a marketer, numerous touch points throughout the funnel will ensure your brand stays top of mind as buyers make their purchasing decisions. Additionally, nurturing campaigns can re-engage existing customers. Facebook’s advertising services help you stay in front of current and prospective customers while they browse the popular social network.



Case Study – Watters

Watters Logo | ReTargeter

Watters is the brainchild of designer Vatana Watters. For over 30 years, it has been the leader in offering luxurious designer bridal gowns, innovative bridesmaids dresses, classic special occasion dresses for mothers of the wedding, and adorable dresses for flower girls and junior bridesmaids around the world. Selling primarily at trunk shows and in third-party […]

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