Final answer:
A lookalike audience consists of individuals who share similar characteristics with existing customers, helping businesses to target potential new customers that are likely to have an interest in their products or services.
Step-by-step explanation:
A lookalike audience is made up of people who share similar characteristics with your existing customers. This concept is widely used in marketing, especially in digital marketing strategies, to identify potential customers that are most likely to be interested in a company's products or services. By analyzing the data and behaviors of existing customers, businesses can target a new group of people who exhibit similar behaviors and interests.
For instance, if an online retailer has a consumer base that predominantly enjoys outdoor sports, the retailer might leverage that data to find a lookalike audience who share that interest. This involves using algorithms and data analytics tools to pinpoint the traits that characterize the existing customers and finding new individuals who resemble that existing audience. These lookalike audiences have not yet interacted with the brand, unlike those who have already converted on your website or are actively searching for products or services, and also unlike those who are completely unrelated to the business.