The Complete Guide to Facebook Custom Audience

One thing that distinguished Facebook from other online advertising platforms, is its Facebook Custom Audience. If used right, this could be the holy grail to your online advertising success. In this article I’ll walk you through how to set up Facebook Custom Audiences, and how to use them effectively.


What is Facebook Custom Audience?

Before you start using Facebook Custom Audience, you’re only unlocking 30% potential of Facebook advertising.

A Facebook Custom Audience from a customer list is a type of audience you can create made up of your existing customers. You can target ads to the audience you’ve created on Facebook, Instagram, and Audience Network. (source: Facebook)

Imagine now you can create highly targeted ads to your warm and hot audiences specifically – those who have already heard about you, or interacted with you at one point of time, probably your email newsletter subscribers or your previous customers. In any digital marketing campaigns, it is important to have clear understanding on which audience are we targeting.

These audiences we’re talking about here¬†are not just your¬†targeted audience by demographic, but at which segment the audience falls under. Audiences can be categorized into three (3) level:

  1. Cold Audience – those who are new to your brand
  2. Warm Audience – those who have interacted with you before
  3. Hot Audience – those who trusts your brand after being exposed to your brand for awhile


Facebook Custom Audience allows you to identify, and group your warm and hot audiences together under different categories, and with that you’re able to create target ads to drive them further down the funnel.


How to Create Facebook Custom Audience?

All the wonderful tools are right inside your Facebook Ads Manager. If  you have not, I strongly recommend you to set up Facebook Business Manager to get the most out of Facebook advertising. To start using Facebook Custom Audience, click on hamburger icon at the top left of your Facebook Ads Manager dashboard, and select Audiences under Assets.


Business Manager Property

Facebook is constantly adding new features and elements to the Ads Manager, and this menu has been expanding rapidly since early 2016. Be sure to revisit this menu to catch up with the changes from time to time.

Create Audience

Create Audience

Once you’re in the Audiences dashboard, you’ll see this – click on the “Create Audience” button to start and you’ll see this:

Select audience type to create

Select audience type to create

Select Custom Audience and you’ll be landing on this page.

4 types of Custom Audiences to be created

4 types of Custom Audiences to be created

There are 4 types of Custom Audience you can create with the tool base on:

  1. Customer File
  2. Website Traffic
  3. App Activity
  4. Engagement on Facebook

I’m going to walk you through on the Custom Audience creation, and I’ll share the effective strategy on how to use each Facebook Custom Audience to optimize your Facebook advertising campaigns.


Create Facebook Custom Audience with Customer File


Create Facebook Custom Audience with Customer FIle

This method is particularly useful for businesses that has been around for awhile with a strong customer database accumulated over the years. If you already have an existing database, you can import using file CSV/Excel file upload or directly copy and paste into the system. You may also choose to import your lists directly from Mailchimp if you have been using the system.

Customer File Import

Customer File Import

Customer file uploading or copy and paste is easy with Facebook Ads Manager. The system will take you through the 4-step to complete import.

Import from Mailchimp

Import from Mailchimp

If you choose to opt for Mailchimp import, just follow the steps to complete account linking and start choosing your lists to be imported and you’re done! Now, let’s talk about how to use the custom audiences created from your existing database.


Usage: Replacing Email Marketing or SMS Marketing

This is especially useful for brands with huge database. Say if you have 100,000 email addresses or SMS gathered over the years, traditionally if we use Mailchimp (for example) or SMS marketing, the cost would be ranging from RM1,000 to RM2,000 per blast.

With less than 20% open rate for both, generally we are reaching about 20,000 people with the amount spent, and with less than 3% click through rate, it is actually very costly.

Based on our case study, the average reach for every RM1 spent is 60, by spending less than 500 we would have reached the 100,000 once, and with 3% click through rate, you do the math.


Create Facebook Custom Audience with Website Traffic

This is the fun part. The biggest mistake most small businesses make when it comes to website traffic, is not paying attention to “unconverted traffic”.

I’ve worked with hundreds of local businesses, most of them talk about “number of visits vs number of enquiries/purchases/etc.” but very few of them questions like “what are we doing about the 97% unconverted traffic?”, or “why is our conversion lower than 3%?” and “what can we do to increase conversion rate by 10% month-by-month?”.

Crucial to ask those questions, and crucial to do something about the unconverted traffic.


Create Audience with Website Traffic

Creating Facebook Custom Audience with website traffic is fun with Facebook Pixel based on:

  1. Anyone who visits your website
  2. People who visits specific web pages
  3. People visiting specific web pages but not others
  4. People who haven’t visited in a certain amount of time
  5. Custom Combination

Let’s take a look at each of them and the usage.


Usage: Anyone who visits your website


Anyone who visits your website

This method allows you to generally capture everyone who visited your website up to the last 180 days. We usually use this custom audience to create the first layer of warm audiences Рgenerally used for top-of-funnel campaigns to drive general awareness to the brand such as general promotion, etc.


Usage: People who visits specific web pages


People who visits specific web pages

This method allows you to capture visitors who visited specific pages in your website. You can either use exact URL equals or URL contains for your targeting. What’s the difference? Let’s take a look:

  1. URL equals – useful if you want to track specific landing page. For example, you want to track visitors who visited your web page for “web design” service, who visited You can use this method to segmentize your visitors who are more likely to be interested in each of your services.
  2. URL contains – useful if you have a website with vast number of pages, for example ecommerce website. We usually use this to track specific funnel layers such as “add to cart”, “checkout”, or “complete purchase”. These URLs usually have a specific words despite the variables unique for each order, so we will use URL contains “/shop/cart/“, “/shop/checkout/” or “shop/thank-you/”. You may also use this method to capture visitors based on category, and use them to create specific promotions for these visitors according to their interest.


Usage: People visiting specific web pages but not others


People visiting specific web pages but not others

This is custom audience that combines 2 types of conditions – those who visited any web pages but not others. You can use this custom audience to capture those who visited any of your pages but did not complete a certain goal, such as completing a purchase. It helps you further identify your unconverted audience to help you narrow your ads targeting to those that matters to your business.


Usage: People who haven’t visited in a certain amount of time


People who haven’t visited in a certain amount of time

If your business has a long cycle of conversion, this might be a useful custom audience you can consider using. Remember we always receive emails from marketplaces saying they misses us and want us back plus offering us RM5 discount voucher or something? Imagine you can do this for your visitors, but via Facebook ads with definitely better CTR than emails. This helps you capture old visits and turn them into converting opportunities by offering personalized incentives or rewards.


Usage: Custom Combination


Custom Combination

Last but not least, the most customized custom conversion. You can add multiple conditions to create hyper narrowed custom audience that is so specific, you will be able to create hyper targeted ads that locks down to those less than 100 visitors who went through different pages but did not convert in the past 3 months. The possibility is almost endless.


Create Facebook Custom Audience with App Activity

Next is custom audience based on app activity. Before you can start using this custom audience, you must setup your apps with Facebook. Visit this page and follow the steps.


Create Facebook Custom Audience with App Activity

Facebook is becoming one of the most important platform for mobile apps marketing. Facebook Analytics for Apps is also a robust to help you understand the activities within your app. Once your app is integrated with Facebook, you can create custom audiences based on:

  1. Action taken – target everyone who downloaded your app in the past 30 days to create onboarding ads that educate your users and move them along your conversion funnel.
  2. Action not taken – target those who have not perform a specific action on your app, for example in-app purchase or signup or complete purchase.
  3. Combined action – you can also narrow down your custom audience based on a combined action, for example those who have added product to cart in your app, but did not purchase. This helps you hyper-target highly potential users that are more like to convert.
  4. Segment – you can also create custom audience based on segment, such as genders, platforms or top 10% launches.


Create Facebook Custom Audience with Engagement on Facebook

This is one powerful way to create custom audience based on their interaction with your videos, lead forms or canvas ads, which are Facebook native features.

Create Facebook Custom Audience with Engagement on Facebook

Create Facebook Custom Audience with Engagement on Facebook

You can create custom audiences based on your video views, lead form opens and canvas. Let’s take a look at each of them and the usage.


Usage: Engagement on Video

If you’re not aware, Facebook is putting a lot of effort in growing their video content. It is proven that video generates more reach¬†compare to other ads types on Facebook.


Engagement on Video

It is obvious Facebook is trying to become the leading video sharing platform (Facebook has beaten Flickr since 2013, if you still remember it), and we can see from its move of placing video as its center of advertising strategy.

You can now create custom audience based on the amount of time she spent watching your video, or based on the the percentage of video she watched. This gives you a good way to segmentize you audience together based on the perceived interest in your brand, common sense is if someone cared enough to watch  up to 75% of the video, she must be interest.


Usage: Engagement on Lead Ads

Lead generation ads is one of the best advertising tool ever created by Facebook. It helps marketers convert their page likes from mere numbers into actionable database.


Engagement on Lead Ad

Since this is a native Facebook feature, you can create¬†custom audience based on action taken (or not taken) to further group your audience for your funnel. You can create¬†custom audience base those who opened your form, opened but didn’t submit and those who opened and submitted. We usually use this custom audience to create lookalike audience for audience expansion based on those who opened as reference. You may also consider excluding those who submitted to a lead form from future lead generation ads.


Usage: Engagement on Canvas (Now Instant Experience)

Canvas is a new ad format that allows you to create “immersive and expressive experience on Facebook for businesses to tell their stories and showcase their products”, according to Facebook. It is an ads format that combines videos, still images and call-to-action buttons.


Engagement on Canvas

If you use canvas ads, you can create custom audience based on those who opened your canvas, or those who clicked any link in your canvas. The usage is pretty much similar to those of website traffic, mainly to group “unconverted audience” and segmentize audiences based on their actions taken for retargeting and move them further through the funnel.


Retargeting matters

It is important for any businesses that plans to start advertising on Facebook to have a clear objective in place, and most importantly a funnel. Without having a crystal clear direction on how you wish to guide your audience to go through their “customer journey” and to reach your goals, you are most probably wasting your advertising budget.

Before you start using Facebook Custom Audience, you’re only unlocking 30% potential of Facebook advertising.

To learn more about how to advertise effectively on Facebook, join our Master Class.