Facebook Custom Audience: Everything You Need To Know

A Facebook Custom Audience is one of the most powerful Facebook Ad targeting options available on their platform.
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Facebook Custom Audiences launched in 2012, and in the early days, David Fischer (Chief Revenue Officer at Facebook), would frequently say that "Custom Audiences are like butter." They make everything better and are a foundational part of scaling your ads 🍞.
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Granular targeting is one of Facebook's core strengths and why businesses from SMBs to huge enterprises run Facebook Ads. You can reach nearly any audience niches you'd like to target, thanks to their massive global population of over 1.5M Daily Active Users.
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On top of targeting, the recipe for a successful ad depends on multiple factors, such as your creative, messaging, call-to-action, and optimizing the landing page destination where you send people.
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But if you're not able to laser in on reaching people who are interested in your products and services, optimizing all other parts of your Facebook Ads can only get you so far.
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So let's dive in to everything you need to know about a Facebook Custom Audience! Including:
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What is a Facebook Custom Audience
How to create Facebook Custom Audiences (all 10 of them!)
The value of creating Custom Audiences
A new tool for improving your Custom Audiences
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What is a Facebook Custom Audience?

A Facebook Custom Audience is an advertising targeting tool that lets you create a segment of people using data you already have, and reach them with ads if they're on Facebook.
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The custom audience list can be made up of any combination of people from your CRM as well as people who visited your website, downloaded your app, made purchases in your retail store, and more. And you can use it for inclusion and/or exclusion targeting, or even create a Lookalike Audience to find new customers similar to your best ones.
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There are 10 different types of Facebook Custom Audiences you can create, using your own sources or Facebook sources. They're constantly expanding as Facebook increases their ad and platform offerings. Note: Each ad account can create up to 500 Custom Audiences.
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The 4 different types of Facebook Custom Audiences from your own sources:
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💻 Website traffic: Create an audience of anyone who's visited your site (as far back as 180 days) by adding the Facebook pixel to your site.
‍ Customer list: This is first option that existed when Custom Audiences launched. You can upload a CSV or TXT file containing your customer email addresses, phone numbers, and many other identifiers to match it with people on Facebook.
📱 Mobile App activity: If your mobile app is integrated with the Facebook SDK, you can target your ads to people who have (or haven't) taken key actions in your app, based on your app events. For example, people who installed your app but haven't opened it in the last 30 days.
Offline activity: Create an audience of anyone who's taken action offline (as far back as 720 days), such as made a purchase in-store, by uploading this list to Facebook and targeting people who match the list on Facebook with ads.

The 6 different types of Engagement Custom Audiences from Facebook sources:
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All of these audiences are based on people who've engaged with your content from Facebook's family of apps in the past 365 days.
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📺 Video: People who watched one of your Facebook or Instagram videos.
Instagram business profile: People who engaged with your Instagram profile directly or from an ad.
📃 Lead form: People who opened or filled out one of your lead generation ad forms on Facebook or Instagram.
Events: People who engaged with one of your Facebook Events.
📱 Instant Experience: People who opened your Instant Experience on Facebook or Instagram. Instant Experiences (IX) were previously called Canvas ads, and are fullscreen experiences that showcase your products or services after someone clicks on your ads.
📜 Facebook Page: People who've interacted with your Facebook Page or follow it.
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How to Create a Facebook Custom Audience

To create a Facebook Custom Audience, follow these 6 easy steps.
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💥 Pro tip: You can also skip all these steps and get help from Needls, a unique 24/7 RoboAgency we love, who takes care of all your Facebook and Instagram advertising (without the agency prices 😉).
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Step 1: From your Facebook Ads Manager, visit the Audiences tab.
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Go to your Facebook Ads Manager
From the hamburger menu at the top 🍔, under "Assets", select "Audiences".

Step 2: Click on the blue "Create Audience" button and select "Custom Audience"

Step 3: Choose a source you'd like to create a custom audience from

Now, you're ready to choose from any of 10 different types of Facebook Custom Audiences.

Learn how to set each of them up, plus key tips in the next few how-to sections!

Step 4: Create your Custom Audience and wait for it to populate

Once you've selected a source and created your Custom Audience, from your Audiences tab, you'll find the list of all your Facebook Custom Audiences. This includes their name, size (only available for custom audiences created from customer lists), availability and more.

The availability "Ready" state means you can start using that custom audience in your ads.

Step 5: Create a new ad based on your Custom Audience

There's 2 ways you can create an ad from a Custom Audience.
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Option 1: From the Audiences tab, simply click on the Custom Audience name, and in the window that appears, select Actions at the top-right and then "Create Ad"

Option 2: Return to your Ads Manager tab, then click the green plus icon + on the left and select "Create Campaign"

Step 6: Setup a New Campaign and Ad Set, then find your Custom Audience
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If you select Option 2 and create a new Campaign, from your new Ad Set, scroll to the Audience section.
Under Create New Audience or Use Saved Audience, simply search for the Custom Audience you'd like to target.
Below is an example if we wanted to retarget our Website Custom Audience named "Website visitors".

From there, just setup the rest of your Ad Set and Ad details, and launch your new ad! 🚀

Now we'll give you a look into how to setup each of the different Custom Audience types.
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How to Create a Facebook Custom Audience From Website Traffic

Website Custom Audiences are the basis for all the retargeting ads you may see when you visit a website and then get targeted not long afterwards with their ads 😉.
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As a pre-requisite, you'll need to have the Facebook Pixel installed across your webpages so you can track your website activity, conversions and other important events (e.g. completed registration, add to cart, signup).
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Step 1: Select "website traffic" as your audience source.

Step 2: Choose the types of website visitors to include or exclude.

You can created targeted segments, such as:
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All your website visitors (as far back as 180 days)
People who only visited specific webpages e.g. your pricing page or a product page
Based on visitor time spent e.g. target the top 5%, 10% or 25% percentiles
Based on pixel events you've created e.g. signup or purchase

It's then easy to mix and match them like we do, such as retargeting people who visited our pricing page but excluding those who haven't yet signed up.
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💪 Pro tips
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If your goal is customer conversions, and you're retargeting your website visitors, start by creating a list of your existing customers. Then, be sure to exclude your current customers from your ads so you don't waste any dollars targeting them.

How to Create a Facebook Custom Audience From a Customer List

Step 1: Select "Customer list" as your audience source.

Step 2: Select from 3 different types of customer lists

A CSV or TXT file that includes your customer LTV (this is helpful for creating Lookalike Audiences based on your highest lifetime value customers)
A CSV or TXT that doesn't include LTV
Importing your email contacts from your CRM (Mailchimp)

Note: Ensure you own the data from the lists, and are following GDPR legal guidelines when uploading data from people living in the EU.

Step 3: If you choose to upload a list directly, add key customer data identifiers to your file.

The definition an identifier from Facebook: "An identifier is used to match your customers to people on Facebook. To improve your potential match rate, include as many identifiers as possible as columns in your file. Data will be hashed prior to upload and we will not store it after the upload is finished."

There are currently 15 different identifiers you can use:
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Email
Phone number
Mobile advertiser ID
First Name
Last Name
ZIP / Postal Code
City
State/Province
Country
Date of birth
Year of birth
Gender
Age
Facebook App User ID
Facebook Page User ID

Then, upload your file in a CSV or TXT format, give it an easy to remember name, and create it.
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💪 Pro tips
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Create different types of lists, such as your highest value customers so you can retarget them with new product betas. Or create a list of your lowest value customers, so you can test ways to educate and upsell them to become stickier users.
Include as many customer identifiers as possible to increase you Custom Audience match rates, as match rates vary in the US based on data you upload. For example, using 300,000 email addresses of people who visited their website, WordStream saw a 50% match rate. Clix also saw 50% match rates when uploading a list of 30,000 customer email addresses, but when they uploaded the phone number, first name, last name, email, city, state and zip code – the match rate increased to 80%.

How to Create a Facebook Custom Audience From App Activity

As a pre-requisite for running Facebook App Ads, you'll need to have the Facebook SDK installed in your iOS or Android app so you can track and optimize actions taken in your mobile apps.
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Step 1: Select "App activity" as your audience source.

Step 2: Create an App Activity Custom Audience based on app engagement

There are 4 different types of engagement you can target (up to 180 days ago):
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People who opened your app.
Most active users, based on percentiles (5%, 10%, or 25%).
Users by purchase amount, based on percentiles (5%, 10%, or 25%).
Users by segment, which you can create based on their actions, demographics, device information and more from the Facebook Analytics tool.
Based on your app events. Note: Facebook provides standard events in the SDK, and you can also create custom events specific to your app.

Once you've selected your engagement rules, name your audience and then create it!
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How to Create a Facebook Custom Audience From Offline Activity

Creating Offline Custom Audiences is similar to a Customer List, except that you'd upload a list of customer activity that happens, you guessed it - offline.
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You can then target them based on their offline activity, such as an in-store purchase or booking.
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Note: to automatically send Facebook your offline conversion events data, you can use their Offline Conversions API.
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Step 1: Select "Offline activity" as your audience source.

Step 2: Create an Offline Activity Custom Audience based on offline events

You can select multiple events they've taken offline (as far back as 720 days), to better segment the audience you're targeting.
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On top of that, you can refine your data based on the value of the custom value or aggregated value. For example, if you set your offline event based on purchase, you can add an aggregated value where the frequency is "2" meaning they purchased at least 2 times, or based on a minimum value of $20, meaning they had purchases of least $20.
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How to Create a Facebook Engagement Custom Audience

First, start by selecting any of the 6 Facebook sources for your custom audience.

We'll give you a snapshot of what you can do when using each of the Facebook sources below.
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A Video Engagement Custom Audience

You can create an audience based on how long they've viewed your video (in seconds), or how much of your video they've seen (as a percentage).
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Since people tend to drop off after the first 3 seconds of watching a video, you can start with a shorter viewing audience to capture a larger number of people. But also experiment with people who are more fully engaged with your videos and likely to be more responsive to your ads.
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💥 Pro tip: Get some video ads inspiration from the top B2B Facebook Video Ads here.
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An Instagram Business Profile Custom Audience

You can create an audience based on people who've met any or all of the criteria based on their interaction with your Instagram business profile.
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Anyone who visited your business profile (regardless of the action they took).
People who engaged with a post or ad. This includes: likes, comments, saves, carousel swipes, tapping call-to-action buttons or sharing a post or ad using direct message.
People who sent your business profile a message.
People who saved any of your posts or ads.

💥 Pro tip: Learn how to retarget people who've clicked on your Instagram bio link.
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A Lead Form Custom Audience

If you're running Facebook Ads for Lead Generation, you can target people who've taken any or all actions on your lead gen forms.
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For example:

Anyone who opened a form.
People who opened but didn't submit a form (e.g. target them with ads that bring them to your site to learn more).
People who opened and submitted form (e.g. target them with ads on success stories, to encourage them to become a successful customer like others).

An Event Custom Audience

If you've created a Facebook Event for an in-person event, conference, or even an online webinar, you can target people and segment them based on any or all activity they've taken on your event page - from people who've RSVP'd to people who've purchased tickets.
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An Instant Experience Custom Audience

Instant Experiences (IX) are ads that open up a full-screen experience promoting your products or services. So this gives you the ability to target people who've engaged with any of your Instant Experiences, including people who opened your IX or clicked on any product links in it.
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A Facebook Page Custom Audience

Targeting people who've interacted with your Facebook Page is another way to re-engage people that've actively taken the step to follow or engage with your business.
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You can choose any Page actions, from people who simply went to your Page and didn't take any specific actions, to people who engaged with a post (which shows they're highly engaged), to people who sent a message to your Page (another high engagement signal) and more.
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Why Should You Create a Facebook Custom Audience

Here are 4 major benefits of creating a Facebook Custom Audience.

1. Retargeting website visitors to bring them back

From our own experiences, and those of others in the industry, retargeting simply works. ComScore found that with retargeting, 26% of people who are retargeted are more likely to complete a purchase, and 70% of people are more likely to convert.
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If you aren't already creating retargeting ads, you may be missing out on opportunities to convert people who already expressed some interest in your products and services, but may have left and forgotten about them.
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💥 Pro tip: Test special offers or tailor your messages to people who visited key pages on your website, to more effectively entice them to come back and signup or complete a purchase.
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2. Find new customers by turning your Facebook Custom Audience into a lookalike audience

If Facebook Custom Audiences are the king of retargeting and reaching existing leads and customers, then Lookalike Audiences are the king of new customer acquisition 👑.
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Lookalike Audiences are a highly effective tool in your acquisition toolkit, as you can reach people who look similar to your best customers in just a few clicks, without having to creatively find ways to reach your ideal audience.
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The basis for a Lookalike Audience is your Custom Audience. And as you saw earlier, you have lots of different ways to create engaging Custom Audiences. So it's easy to then turn any existing Custom Audience into a Lookalike Audience.
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💥 Pro tip: Learn all about how to create a Lookalike Audience in this guide .

3. Upsell, educate, or announce news to existing customers

The end goal for any business is ultimately revenue from happy and retained customers.

To get there, you can use Custom Audiences as a way to upsell your customer base on additional features by showcasing them in ads. Or even promote success stories about people in higher plans and the tangible benefits they've seen.
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It's also a great way to announce new product launches or company news, and stay top of mind when your customers are active on Facebook.

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4. A/B test different messages and products to different segments

Running online ads as a whole are a great way to A/B test your creative, content, value props, messaging, and more.
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So Custom Audiences give you a great playground to get immediate feedback from existing customers. For example, when you're launching a new product, you can test different benefits, creative (videos vs. images), and more to see what resonates best.
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You can also use this to tweak and optimize your acquisition ads, and how you message and promote your products in marketing materials to brand new customers.
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Facebook Custom Audience + PixelMe = ❤️ Amazing Targeting

As a bonus benefit of why Facebook Custom Audiences are so powerful, is that they give you an edge on others through link retargeting.
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It's a newer retargeting technology we built that lets you embed a Facebook pixel (or any advertising pixels) into short links you share. You can then automatically build a Website Custom Audience from people who clicked on them, and retarget them.
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So when you share links to PR articles, send people to your YouTube videos, encourage people to download your iOS or Android apps, or simply curate and share 3rd party content - those clicks are no longer going to waste 🎉.
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💥 Pro tip: Follow our step-by-step Facebook link retargeting guide here.

Track & Target Away 🎯

Facebook is known for their famous mantra "Move fast and break things". At an F8 Developer conference in 2014, they embraced an updated version: "Move fast with stable infra." They committed to still moving quickly, but fixing all major bugs within 48 hours.
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Though this was in the context of technical product launches, the same can be applied when launching and A/B testing your ads, to ensure you have a stable foundation for measuring and optimizing them for a high ROI.
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So we'll end with key tools that help you do marketing attribution, and let you see which ads and channels work best so you get the most out of your budgets 🚀.
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Facebook Attribution: Facebook's own free attribution tool that shows you purchase and conversion paths across their family of apps and other sources.
AppsFlyer: A leading mobile app attribution tool for measuring all your paid & organic app installs, and optimizing your ad spend.
Bizible: A leading attribution tool for B2B enterprises. It connects straight into Salesforce so you can measure and optimize your efforts for higher revenue.
Smart Attribution: The first Customer Attribution tool that shows your customer journeys and ROI across your ads, so you know where to spend your dollars.

Want to automatically track the ROI from your Facebook Ads? Try PixelMe for free 🎉. Or just message us from the blue chat icon in the bottom-right corner with any questions! 💬
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