News

Facebook’s Privacy & Data Issues – What’s the impact on advertisers?

05.04.18

by Jared Lake, VP of Digital Strategy

It has been a rough month for Facebook…in the news. And while there will definitely be changes made, the impact to the advertisers that rely on the platform will be minimal.

Many brands, including several we work with at Ocean Media, have thoroughly evaluated and tested the platform and determined that Facebook and Instagram are essential parts of their marketing mix. Additionally, we find Facebook is an efficient way to add incremental reach to a well-rounded video advertising strategy.

Those core strengths that make Facebook so valuable will remain intact. When used correctly by the advertiser, Facebook excels in its ability to identify the most relevant audiences for its ads. As Mark Zuckerberg noted in his testimony on Capitol Hill, this data isn’t sold or exchanged directly in any way with 3rd parties or advertisers. It is, however, used with great accuracy to determine what audiences the advertiser should bid on and show ads to. It’s this very specific and rich Facebook data set that allows advertisers to run very efficient and targeted campaigns.

However, some things ARE going away such as:

  1. 3rd Party Data – From the likes of BlueKai, eXelate, Exeperian etc. New policies will be implemented to enable the use of this data via direct relationships with advertisers and the data providers. New AdSets can still be created using this data until July but all use of this data will be discontinued in September. This is data that although available, isn’t heavily relied on by most advertisers for the majority of their Facebook campaigns.
  2. Planning & Research Tools – Essentially all reach and insight data has been removed for custom audiences. This is the biggest impact to come out of all of this because custom audiences are representative of anyone who converted on an advertiser’s site. Facebook’s audience insight tool provided very useful data in defining new target audiences.
  3. Browsing History – Facebook collects consumer data to improve ad performance based on actions from within Facebook’s ecosystem as well as across 3rd party websites that are leveraging developer tools and tracking from Facebook. Consumers can now clear the history collected from 3rd party sites and/or opt out from future tracking. If consumers choose to change their privacy settings and opt out this will impact the accuracy of the data advertisers use for targeting. As with most updates to privacy settings, the use of this feature is not expected to be substantial. Therefore, advertisers should not expect significant impacts to the accuracy or effectiveness of Facebook’s targeting.

Something else that didn’t happen in all of this is a meaningful decrease in people’s use of Facebook. #deletefacebook resulted in a few high profile deletes, but it’s estimated to have only resulted in about 20,000 additional account deletions than would have occurred anyway in the same time period. Privacy settings were also largely untouched.

Facebook is an important and efficient advertising platform that continues to evolve, with new advertising products regularly announced. Instagram Stories have proven to be an effective brand and DR channel. Dynamic Product Ads (DPA) have also proven to be an effective tool for ecommerce brands to show relevant products to consumers and/or retarget based on their browsing history on the site.

We think the advertising community can universally agree the primary area in need of improvement is real progress towards breaking down the walled gardens. Facebook’s Advanced Measurement platform has not yet delivered on the promise of cross-channel digital measurement and even if it does deliver, it would create a situation where Facebook is essentially grading their own homework. Unfortunately, hiding behind PII and privacy could create a convenient excuse to reinforce the garden’s walls.

While some of these changes will impact the tactics that advertisers use to plan and buy on the platform, the core value proposition for brands on Facebook remains intact.  Facebook will continue to remain a high reach, cost efficient component to most media strategies.