In the post-iOS 14 world, eCommerce brands have faced two significant challenges in their Facebook advertising: high customer acquisition costs and lower quality lookalike audiences.
This, to be technical, sucks. The magic Facebook advertising machine from the past is largely just that: in the past. But rather than dwelling on what was, we want to focus on what can and will be. Facebook remains a powerful advertising platform with a vast amount of data, and you can still leverage it as part of a balanced advertising strategy.
Going forward, the key will be to leverage your customer data to power true lifecycle marketing in Facebook and optimize it as an acquisition channel, which you can now do with Daasity Audiences, a tool that allows brands to push any data into their marketing channels for one-to-one personalization. But what would this lifecycle marketing look like?
- Automatically updating customer data in Facebook daily
- Retargeting your existing customers on a cohort basis and showing them personalized ads
- Targeting existing buyers to nurture them to become Multi-Buyers and High Value Customers (HVCs)
- Retaining HVCs or pushing your Churning/Lapsed HVC data into Facebook to retarget them, showing them personalized ads, and driving them to repurchase
- Building lookalike audiences based on your own customer data for optimized acquisition
Here’s a visual to explain further:
Get the right message to the right customers and supercharge and reinvigorate great marketing tools to maximize their potential. Clearly marketing to your customers at every distinct phase of their lifecycle with your brand is the Facebook advertising strategy you should start using yesterday.
Bringing Lifecycle Marketing to Facebook
Lifecycle marketing considers the entirety of a brand’s relationship with a customer. This means the early touchpoints with them, their first purchase, when they’re a loyal customer, when they’re an HVC, when they’ve churned or lapsed, and the tactics to deploy to reactivate them as customers.
It’s been something of a holy grail to bring true lifecycle marketing to Facebook advertising, but it’s now possible with your own data and Daasity Audiences. Your data is more powerful, relevant, and necessary than ever since Apple’s privacy changes in iOS 14 have slowed the mighty river of data into Facebook to a trickle.
Via Daasity Audiences, you can retarget any segment of your existing customers based on your current customer segments (in the visual above, we’ve added a few examples of segments, such as Gender), and nurture them into HVCs.
Additionally—and most importantly—you can focus on your current HVCs and retarget your Churning or Lapsed HVCs to reactivate them as customers.
Retargeting your Churning or Lapsed HVCs
Your HVCs are the lifeblood of your business. You do not want to lose them. Some of them may not have purchased from you in a while, but that doesn’t mean you should let them go. In fact, you want to do everything you can to reactivate them as customers and keep them as long as possible.
Here’s where we can add another layer of sophistication to your Facebook advertising strategy to make sure they stay.
What you want to do is coordinate your customer winback campaigns across email, SMS, and Facebook. So, for example, if you have email and SMS flows for Churning HVCs and Lapsed HVCs, you want to design specific ads on Facebook for them to ensure you’re pulling out all the stops to make sure they purchase again.
You can offer a “Welcome Back” discount or another type of heavy discount that will get them back in your marketing funnel.
Optimizing your ads with exclusions
To maximize your retargeting’s efficiency, you need to customize your campaigns to exclude those who you don’t want to target.
A dirty secret about the nature of customer acquisition on Facebook, particularly post IOS-14, is that many customers who eCommerce brands “acquire” are actually re-acquired, which means that brands are spending far more on customer acquisition than they need or should be.
To combat this, especially in light of how expensive acquisition is on Facebook (which shows no sign of cheapening), we highly recommend running exclusions in order to avoid acquiring the same customers more than once. The key here is to consider who you are excluding based on the content of the ads you run.
Here are a few ideas:
- Exclude single purchasers in cold prospecting ads: It’s inevitable that Facebook will target some existing purchasers when running your cold prospecting ads. Send your customer data back to Facebook as an exclusion to ensure that you are only spending your acquisition budget on acquiring first-time customers (as it should be).
- Exclude paused and churned subscribers when you’re running ads targeting subscription customers. By filtering these segments out, you can speak directly to your active subscribers and deliver special content and offers in your ads since you are confident they are subscribed to your brand.
- Exclude HVCs or customers who have never used a discount code from your ads promoting a heavy discount. Save your discounts for the customers who care more about them, rather than the customers who already love you or who aren’t price sensitive.
Building Lookalikes You’ll Love the Look of
By piping your own first-party customer data into Facebook via Daasity Audiences, you’ll supercharge Facebook and tailor its lookalike-building powers to your brand specifically.
To build the most valuable lookalikes, we recommend pushing data from five major customer segments into Facebook.
Current High Value Customers (HVCs)
Your HVCs are the customer group responsible for the majority of profits, they’re your biggest fans, and they are the segment most likely to account for the majority of your purchases for years to come.
There are a number of ways of segmenting your customer base in order to identify your HVCs, but we recommend using RFM Analysis to segment your customers into deciles (10 groups).
This is a reliable measurement of customer value over a time period based on Recency (how recently a customer has purchased), Frequency (how often they have purchased), and Monetary (how much they spent).
By pushing your HVC customer data into Facebook, Facebook will be able to create custom audiences based on their contact information. After that, you can run Facebook, Instagram, and Messenger ads to those new audiences that specifically target new potential HVCs.
In the face of expensive customer acquisition, increasing the likelihood of acquiring valuable customers is crucial, and by using Facebook’s powerful targeting system along with your own customer data, you can. To determine how much you can invest, determine what your LTV:CAC ratio is.
While your current HVCs are the best starting place for building lookalike audiences in Facebook, another great bet is to build lookalikes based on Multi-Buyers. The definition of a Multi-Buyer may vary. At Daasity, for example, we define a Multi-Buyer as a customer who has purchased at least twice within the last year.
Because Multi-Buyers have high potential to become HVCs with the right nurturing, building lookalikes based on Multi-Buyers means that you’re making an investment in not only potentially new Multi-Buyers but also new HVCs.
Customers Who Have Never Used a Discount
Besides passing data into Facebook for customers on a strictly value or profit contribution basis, another segment to consider is customers who have never used a discount or promotion with a purchase.
While it’s likely that you have excellent customers (among them, HVCs) who have used a discount, if a customer has never used one, it may indicate something about their behavioral tendencies or sociodemographic data. For example, they may simply be folks who are more likely to buy without needing to be discounted. Excluding these customers from promotion-heavy ads is a great way to preserve margin.
Customers Who Have Used Discounts
On the flip side, customers who have used a discount (or, as the case may be, frequently use discounts) are also a great audience to include and run promotions or sales to.
They’re likely more cost-conscious shoppers. With that in mind, you can likely drive more sales from them via promotions. That said, in running these promotions, make sure you’re accounting for margin.
If you have a subscription program in place for one or more of your products, you likely place a high value on your subscribers and value them as customers. If they’ve signed up to pay for and receive your product(s) every month, it means they love what you have to offer.
In the same way that you can push data from non-discounting customers into Facebook, pushing subscriber data into Facebook may bring you a new population of profitable customers that will subscribe to your offering as well.
Think through the acquisition path that was most successful for your current subscribers and push new prospects (based on the lookalike audience) through a similar funnel.
Daasity Audiences + Facebook = Lifecycle Marketing
Daasity Audiences allows merchants to automatically push customer data into their marketing platforms for one-to-one messaging and segmentation. You can push your customer data and customer segments directly from Daasity:
Find more of the folks who will love you the most by combining Daasity’s data with Facebook’s targeting and acquisition system. Then, leverage Daasity Audiences with email and SMS (Klaviyo and Attentive), pass individual zero- and first-party data, and build targeted campaigns based on the data. With these bases covered, voila: A complete Facebook advertising strategy.
If you’re interested in learning more about Audiences, we’d love to show you how it works. We wanted to build a marketing tool so powerful and flexible that it sounds too good to be true.