Customer relationship management (CRM) refers to the strategies, practices and technologies that a business uses to analyse and manage customer data, helping them to improve customer relationships and drive sales.
A CRM system helps businesses manage customer accounts, keep their customers’ contact details up to date and track customer interactions.
But how can CRM data be used in paid social campaigns, and how does it work?
How CRM can be used in Facebook
You could be forgiven for thinking that CRM and Facebook are targeted at opposite groups; salespeople looking to manage opportunities and people wanting to connect with their friends online.
But CRM works on the notion that the more data you have about your customers, the stronger your relationship management will be. When you consider that Facebook is a master when it comes to collecting data on its users, it’s not difficult to see why CRM vendors would now want to offer ways to make the most of the social media giant’s potential.
When it comes to Facebook, CRM is known as a ‘custom audience’. A custom audience is a type of audience made up of your existing customers. It allows you to target your ads to the audience you’ve created on Facebook, Instagram and Audience Network.
So, we know that you can use CRM systems in social media platforms like Facebook to nurture customer relationships. But how do you go about it?
How to use your custom audiences to nurture customer relationships
Custom audiences allow you to take your paid social advertising one step further. Although Facebook’s parameter targeting has value when prospecting to new users, without custom audiences in place, it would be impossible to create advanced retargeting strategies or target users that are more relatable to your brand. Facebook gives us four key areas of opportunity when we look to utilise CRM data:
Re-target people who have already purchased from you
The quickest and most effective way to target users outside audiences created with the Facebook pixel is to re-market to users based on a number of CRM variables, e.g. purchasers, newsletter subscribers, etc.
Targeting to previous customers with new product ranges, offers or generic advertising can be an efficient way to increases sales. However, brands that have higher AOVs or long product life cycles may need to manage ad frequency and position to ensure that they do not create a negative brand affinity.
Exclude current purchases
This ensures there is no overlap and is relevant to all members of your audience. After all, if you’re aiming to find new audiences, you don’t want to use your budget on customers you already have.
To do this, you’ll need to create a custom audience list. Then, when you’re putting your ad together, you can target a relevant interest but choose to exclude the custom audience list you’ve just created. That way, you avoid targeting the same users twice.
Create a Lookalike audience
A Lookalike audience allows you to reach new customers who are likely to be interested in your brand because they’re similar to your best existing customers.
To create a Lookalike audience, choose a source audience (this is simply a custom audience created with your mobile app data, pixel data or users that have liked your page) and Facebook will find the qualities that users in that audience share. It will then use this information to find people similar to those users.
During the creation process, you’ll get to select the preferred size of your Lookalike audience. The thing to remember is that similar-sized audiences are more likely to match your source audience. Creating a larger Lookalike audience will certainly increase your reach, but you risk reducing the level of similarity between the two. Generally speaking, your audience should have 1,000-50,000 people in it.
And don’t forget source quality! You’re more likely to get satisfactory results if your source audience is made up of your best customers, rather than all of your customers.
Create a lifetime value audience
A customer lifetime value audience represents the net profit you expect to be attributable to any given customer over the duration of their relationship with your business. That value can be broken down into the following factors:
How often your customer makes a purchase within the purchase cycle
- How much a customer spends on each purchase
- How much you think your customer will spend during your business’s relationship with them
- The length of time you expect the relationship between your business and your customer to last
Bear in mind that you mustn’t use any one of these predictions alone to represent your customer’s lifetime value. Rather, you should combine each estimation into a formula that relates to your business goals and use the results to get a better feel for lifetime value data.
A lifetime value audience is a more advanced form of CRM that can be used as the source for a value-based lookalike audience. To create a lifetime value audience, you’ll need to clean up your customer list to remove any duplicate entries.
When you’ve calculated your lifetime value data, you’ll need to upload the customer list to Facebook. Using Facebook’s built-in functionality, create a lookalike audience, asking Facebook to index by Overall Lifetime Value primarily.
Takeaway
CRM is a very useful tool for Facebook and there are many ways to utilise it, but it will be most effective as part of a full paid social strategy.
If you’re unsure where to begin, our expert team are here to help. Don’t be shy, get in touch for a natter about how we can help you make the most of your Facebook data for flawless, successful campaigns.