“Facebook lookalikes just aren’t working for us anymore.”
Dreaded words for anyone managing Facebook campaigns.
Just like that one of your best performing channels has taken a hit and you are considering cutting budget altogether.
Unfortunately, no one is safe. It can happen to the best of us.
However, brands which are heavily reliable on lookalike models leveraging smaller seeds are particularly susceptible to saturation over time.
A seed audience might be large enough to build up a lookalike model but not large enough to sustain it over a longer period of time.
This occurs for a number of reasons including small conversion pools (or any other pool you are sourcing your audience from), inconsistent replenishment or extraction. Fatigued or underperforming creative might be exaggerating the issue.
Diminishing returns is a first indication.
Lookalike audience saturation presents itself in a number of ways but most commonly clients experience a decline in performance with CPAs getting higher.
In some cases this is accompanied by decreased reach and / or higher CPMs.
In order to determine the true source of the performance decline with some degree of confidence you should look at the following:
Reach over time: if you are seeing a downward trend here this is a good chance your campaigns are suffering from audience fatigue.
First impression ratio: this will help determine what is the ratio of users seeing your ad for the first time. If that is low it might be indicating that you are reaching the same people.
Funnel analysis: This is more so that you can exclude an alternative explanation to the diminishing returns. Looking at the funnel analysis will help you decipher if something else in the user journey is partly to blame. Make sure you compare between different time periods.
Refreshed / better creative: Facebook, in a similar way to Google cares A LOT about user experience on the platform. This includes your ads.
Facebook tends to favour viral or fresh content because it makes for a better experience and thus encouraging the users to spend more time on the platform. In contrast, it makes it harder to reach consumers with bad creative. Think of it as the equivalent of quality score.
Pros: sustainable in the long term
Cons: hard to know with certainty which creatives are good
Audience refresh: This is effectively creating a new lookalike from the same seed. Sometimes it helps to increase the affinity percentage at the same time.
Pros: quick to implement
Cons: you might be trying to mend a blurt wound with a plaster
Ad reset: Reseting your ads is almost like trying to jump start your car. It can work for a while but if the root cause of the saturation persists it’s not sustainable in the long run.
Pros: depending on the complexity of your activity it might be quick to implement
Cons: loss of historical data
Increase bidding: This is a bit of an obvious one. However, be warned!
By increasing your bids you might be able to remedy the issue with the decreased volume of conversions. Use this tactic sparingly however as over time it will make your activity pricier.
Pros: quick fix
Cons: it will cost you
New lookalikes: You can use a different and broader seed audience to create a new set of lookalike models.
Pros: it should allow you to reach some users that you haven’t reached before
Cons: after a point increasing the percentages is making the lookalike audience pointless
Branding: This includes feeding your funnel from the top by opening up the audience pool to include a broader set of users.
In practice, it translates into adding prospecting strategies, or even investing in a broader marketing mix.
Pros: long term effect
Cons: takes long to see results and requires a lot of investment
In conclusion, if you ever experience diminishing returns on Facebook audience saturation might be the root cause. It might sound counter-intuitive but refreshing creative can be one of the more sustainable methods to help remedy the issue. Increasing bids will work in the short term but should be avoided.