Lookalike Modeling: A New Way to Find Your Most Promising Prospects
Imagine you have a highly engaged customer who opens all of your emails, regularly reviews your inventory and makes frequent purchases. If you could somehow reach more customers like this subscriber, your company would have no problem beating sales goals and increasing marketing ROI.
To increase your success, you know you need to target more customers like this one. But how do you get started? How do you know which attributes of this shopper you should be seeking in other potential prospects? Furthermore, even if you’ve determined which characteristics are most important, how do you find consumers who share these same interests and behaviors?
That’s where the marketing industry’s newest secret weapon comes into play. Behold lookalike modeling: your new favorite strategy for finding and reaching your best prospects.
What Exactly is “Lookalike Modeling”?
Lookalike modeling is a methodology advertisers often use to define consumers most likely to engage with your marketing messages. This model considers common traits or behaviors among current customers, and seeks consumers who share those same characteristics. The strategies advertisers use to achieve lookalike modeling vary but, regardless of tactic, the end goal is to drive conversion by serving up marketing messages to a more targeted section of consumers.
In other words, lookalike modeling is a way for you ensure better spend of your customer acquisition budget.
TowerData’s “Lookalike Modeling” Solution
Recently, we’ve talked a lot about hashed emails—the holy grail of consumer data. To help you leverage your database, and harness the power of these hashed emails, we’ve developed our own lookalike modeling tool.
Here’s how it works:
- First, we isolate your best customers based on your needs and business model. For example, a clothing retailer may define “best customers” as those who have made multiple purchases in the past 6 months while a discount travel site may qualify anyone who has booked a vacation in the past year.
- Next, we analyze your “best customer” segment and define commonalities. These traits may include anything from household income and age to activity on social media platforms.
- Finally, we identify all customers within our expansive database who share the same characteristics as your best customers, and pull their hashed emails for your targeting efforts.
Once you’ve obtained your hashed emails, you can upload the list to the platform of your choice. This way, your display budget will be spent targeting consumers who, according to data, are the most likely to behave like your most valued customers.
Additionally, Tower Data can model using fields social media networks may not be able to fulfill. For example, while social media sites are limited by the amount of information individuals choose to include in demographic profile data, as well as user-controlled privacy settings, TowerData's lookalike modeling tool can create models using information including age, homeowner status, income, home value, marital status, the presence of children, and more, with greater accuracy.
Lookalike modeling can not only help you save money and better allocate marketing dollars, it can also help you better understand your customers and the actions driving them to convert. You can use this newfound knowledge to enhance your content, offers and campaigns.
Interested in revolutionizing your targeting through lookalike modeling? Contact us to learn more about our newest data tool.