# How to Build Custom Audiences Using First-Party Data
In an era where privacy regulations are tightening and third-party cookies are crumbling, your business’s most valuable asset is its first-party data. By using the information you already own—like customer email addresses and phone numbers—you can reach your existing clients with laser precision and find new ones who look just like them.
For Australian small businesses, this means moving away from broad, expensive targeting and focusing your budget on people who have already shown interest in your brand, significantly improving your Return on Ad Spend (ROAS).
Why First-Party Data is Your Secret Weapon
First-party data is information you collect directly from your audience. Because this data is unique to your business, it allows you to create "Custom Audiences" on platforms like Meta (Facebook/Instagram) and Google Ads. This enables you to upsell existing customers, re-engage cold leads, or exclude current clients from seeing "new customer only" offers, saving you precious marketing dollars.---
Prerequisites: What You’ll Need Before Starting
Before you dive in, ensure you have the following ready:- A Customer List: A CSV or TXT file containing customer data (emails are most important, followed by phone numbers, first names, and postcodes).
- Privacy Policy: An updated privacy policy on your website that states you use customer data for marketing purposes (essential for Australian Privacy Principles compliance).
- Ad Accounts: Admin access to your Meta Business Suite or Google Ads account.
- Clean Data: Ensure your spreadsheet doesn't have duplicate entries or messy formatting.
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Step 1: Prepare Your Data File
Export your customer list from your CRM (like HubSpot or Salesforce), your POS system, or your eCommerce platform (Shopify/WooCommerce). Screenshot Description: You should see a spreadsheet with columns clearly labelled 'Email', 'Phone', 'First Name', and 'Last Name'.Pro Tip: For the best match rate, include as many identifiers as possible. Meta and Google use these to match your list against their users. If a customer uses one email for your shop but another for Facebook, having their phone number helps the platform make the connection.
Step 2: Format for Platform Requirements
Platforms are picky about formatting. Ensure all phone numbers include the Australian country code (e.g., +61). Remove any special characters or spaces from phone numbers. Emails should be all lowercase.Step 3: Navigate to Meta Audience Manager
Log into your Meta Business Suite. Click on 'All Tools' (the hamburger icon) and select Audiences. Screenshot Description: The Audiences dashboard will show a blue button labelled 'Create Audience' on the top left.Step 4: Create a Custom Audience
Click 'Create Audience' and select Custom Audience. From the list of sources, choose Customer List.Step 5: Agree to Terms and Prepare the List
Meta will remind you about their hashing process (which protects user privacy) and ask if your list includes a 'Customer Value' column. If you have a column showing how much each customer has spent, select 'Yes'. If not, select 'No' and click Next.Step 6: Upload Your CSV
Drag and drop your prepared CSV file into the upload box. Give your audience a clear, descriptive name, such as "All Customers - Exported [Date]" or "High Value Leads - Q3".Step 7: Map Your Fields
Meta will attempt to identify your columns. Review these to ensure 'Email' is mapped to 'Email', 'Phone' to 'Phone', etc. If any columns aren't recognised, manually select the correct identifier from the dropdown menu.Step 8: Finalise and Upload
Click Import and Create. Meta will now hash your data (turning it into anonymous code) and match it against their user base. This usually takes 1-2 hours to fully populate, though you can start building ads immediately.Step 9: Creating Lookalike Audiences (The Growth Phase)
Once your Custom Audience is ready, don't stop there. Select your new audience, click the three dots, and choose Create Lookalike.Select 'Australia' as your region and choose a 1% Lookalike. This tells Meta: "Find me the 1% of Australians who most closely resemble my existing customers." This is often the highest-performing targeting method for local businesses.
Step 10: Repeat the Process for Google Ads
In your Google Ads account, go to Tools and Settings > Shared Library > Audience Manager. Click the blue plus (+) icon and select Customer list. The process for uploading and mapping is very similar to Meta.Note for Google Ads: To use Customer Match, your account must have a good history of policy compliance and usually at least USD $50,000 (approx. AUD $75,000) in total lifetime spend. If you are a newer account, focus on Meta first.
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Common Mistakes to Avoid
- Small List Sizes: If your list has fewer than 100 people, the platforms may struggle to serve ads. Aim for at least 500-1,000 entries for best results.
- Neglecting Data Privacy: Always ensure you have permission to market to these individuals. In Australia, the Spam Act 2003 is strict; ensure you aren't uploading people who have explicitly opted out of marketing.
- Old Data: Customer habits change. If your list is two years old, your match rate and relevance will be low. Update your custom audiences at least once a month.
Troubleshooting
- Low Match Rate: If Meta says it only matched 30% of your list, check your formatting. Ensure the country code (+61) is present for phone numbers.
- Audience "Too Small": If your audience status says "Not Available" or "Too Small," wait 24 hours. If it persists, you may need a larger seed list.
- Upload Errors: Ensure your file is saved as a .CSV (Comma Delimited) and not an Excel Workbook (.XLSX).
Next Steps
Now that you have built your custom audience, your next steps are:- Set up a Retargeting Campaign: Show a specific offer to people who have bought from you before.
- Exclude Customers from Brand Awareness Ads: Don't waste money showing "Introduction" videos to people who already know you.
- Set up an Automation: Use a tool like Zapier to automatically add new CRM leads to your Meta Custom Audience in real-time.
Building custom audiences is the hallmark of a sophisticated marketing strategy. If you find the technical setup daunting or want to ensure your data is being used to its full potential, the team at Local Marketing Group is here to help.
For a professional audit of your current ad strategy or assistance with data integration, contact us today.