Facebook Lookalike Audience Saturation Part 2

This article picks up from where part 1 left off.

Now that we know why lookalike saturation occurs, we can discuss how to address it, by either reversing it or optimizing against it.

There are three main methods by which you can optimize a saturated lookalike and several alternative options.

Main Method #1: Raise Bid/Budget

The first main option is to raise your bid (if you are using a bid cap or target cost) or raise your budget if you are using lowest cost bidding optimization.

As covered in the on lookalike saturation, raising your bid incentivizes Facebook to show your ads to more people (raising your net reachable quotient) because A) it has your permission to charge you more per action and B) your increased bid raises the overall cost that is required to win the auction, and thus Facebook can charge other advertisers more.

While this option is the easiest way to unsaturate a lookalike audience, it is often not a long-term sustainable option as this will fundamentally increase the cost you pay to reach each user which can rapidly eat into your margins and drain your ability to continue spending at that rate, especially if your bid is already competitive. Raising your bid also does not change the intrinsic appeal to Facebook to showing your ads to people. This is like offering a 10% off discount to consumers who refer new users is not intrinsically motivating; as soon as the…