What is Look-alike Modeling and How Does it Works?


By analysing the data we can recognise who are the company’s best customers. After that we can use the data to target them specifically with relevant advertising. But how can you reach more similar kinds of people to gain new high quality customers and decrease the cost of sales?

Look-alike modeling is essentially finding groups of people (audiences) who look and act like your best, most profitable customers. Look-alike modeling is not a new entrant in the advertising industry; it has been around for years helping advertisers and marketers expand their digital audience base and at the same time maintain the relevancy of targeting with little risk. So, why are marketers still hesitant to increase their marketing spend towards look-alike modeling if it is so efficient in converting? Our guess is that they are simply unaware of the opportunity.

Let’s learn a few things about look-alike modeling:

Why use Look-alike Modeling in your marketing efforts? – Look-alike modeling is a powerful tool for targeting new, high-value customers, but many marketers don’t have a clear grasp of what this modeling method involves. Look alike modeling not only helps in saving money but also empowers the marketers to better allocate their marketing spend. It also helps the marketers better understand their customers and the actions which drive conversion.

How does Look-alike Modelling work? – The look-alike modeling process typically involves the use of data enrichment to expand the set of attributes that are used to create the modeled audience. The smaller seed audience from customer can be enriched with added attributes using 3rd party data within a data provider or a DMP. This enriched seed data can then be analysed for patterns of similarity with the data provider’s total audience. The larger audiences based on this enriched data will then “look like” the seed audience.

Where does a DMP come into play with look-alike modeling? – Data Management Platforms are a unifying technology that bring together your data from any source. You can centralise what you know about your most important target audiences from these different data sources. Once you have identified the seed audience, the DMP analyses it, applies proprietary algorithms and finds more user profiles that match the original audience.

For more information:

Relevant can help advertisers directly and enable the growth of data driven marketing services for others as well by providing media and advertising agencies technology and support services. In addition, we train people to get the most out of these solutions and will be able to help them improve services to their customers. If you have questions do not hesitate to contact us or send contact request.

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