To spread the business more widely, social media is the best platform. When we are talking about social media, Facebook is always considered as the leading platform. Facebook has almost 1.45 million active users daily and nearly 2.45 million monthly.
Being a businessman if you are active on Facebook and not doing any Facebook advertising you might be behind your competitors.
Today we talk about How to create a Customer Lifetime Value Lookalike Audience on Facebook.
Before we create the lookalike audience CLV(Customer Lifetime Value), let’s come and understand what is Customer Lifetime Value and how to calculate it.
Customer Lifetime Value(CLV)
It is the predicted profit value that a user earns until the customer keeps buying from him or we can say that it is the total profit money which customers spend in your business to make you profitable until he is left buying from you.
This simply reflects that, the longer the customer is buying from you, the more you will earn and get profitable.
How to calculate Customer Lifetime Value
Here we are going to explain the above definition with a numerical example.
Suppose there is a shoe store. They are selling each shoe pair at $50 with a 15% profit. On average, a person buys a single shoe pair twice a year for five years.
So above numerical states that if a person buys a single shoe pair twice in a year for five years he will give you $75 of profit over that period.
Now we discuss how to create a Customer Lifetime Value Lookalike Audience
1. Click on ‘Ad Manager’.
2. Click on ‘Audiences’.
3. Click on ‘Create a Custom Audience’.
4. Click on ‘Customer List’.
5. In this window, Facebook gives guidelines on how to make the CLV life and what are the Identifiers in the CLV file. Facebook only allows either an excel sheet or CSV(Comma Separated Value for uploading the CLV.
6. Download List Template: Facebook allows you to down a sample CLV excel sheet.
7. See Formatting Guideline: Facebook allows you to first see the formatting guidelines for CLV.
8. Import from Mailchimp: If you have the Mailchimp integration then you can directly fetch the customer file from Mailchimp.
9. Click ‘Next’.
10. Now Facebook is asking ‘Does Your List Include a Column For Customer Value?’
Yes: It means you have to enter the customer lifetime value column on your list.
11. No: Just continue without entering the customer lifetime value column.
12. Upload your CSV file here.
13. Give the name of the audience.
14. Click on ‘Next’
15. Confirm Custom Value Column: Facebook asks to select the value for CLV.
16. Edit data Mapping: Here you have to map the data accordingly to upload it.
17. Create an LLA (Lookalike Audience)
Here it is the final step to create the LLA. Just click on ‘Create Lookalike’ the LLA will create.
In this guide, we learned about how to create a Customer Lifetime Value Lookalike Audience. Cloning the existing customers and targeting them will really generate the best revenue as per my personal experience. This LLA gives a great advantage to generate more purchases.