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What do Facebook’s data privacy woes mean for advertisers and their audiences?

As social media goes, this week has been a rough one for Facebook following its mea culpa that 87 million users’ data was harvested furtively by Cambridge Analytica.

On Tuesday, Facebook founder Mark Zuckerberg exchanged his signature hoodie for a business suit and tie to explain to Congress what went wrong and what additional steps the digital social and advertising giant would take to protect its data.

For now nobody, including Facebook, yet knows what will ultimately change about data privacy and the ability of advertisers to utilize that data for ad targeting. What’s certain is that policies will change — and with that, the best practices for social media advertising will change as well.

Indeed, even before lawmakers act, Facebook is already making adjustments to its data privacy policies. Almost on a daily basis now. This means that the targeted ad campaign that ran yesterday may be less effective and perhaps not even possible tomorrow. We’ve already seen changes in the types of data we can access for competitive reporting on both Facebook and Instagram. (Facebook owns Instagram.)

This is likely just the tip of the iceberg.

For PartnersCreative and advertising agencies of all sizes, Facebook has been a powerful and precise avenue for reaching audiences based on myriad factors including age, interests, education and geography — both where a customer lives and works, and where he or she is at any given moment. Ads are significantly more targetable on Facebook than in newsprint or radio — allowing advertisers to reach precisely defined audiences with relevant information while reducing the amount of useless “noise” that users must wade through. And, we can monitor how effective ads are and adjust accordingly. This makes smart use of our clients’ advertising dollars.

As to data privacy, it’s important to note that buying advertising on Facebook does not give us access to the actual, individual user data. We select targeting parameters for our ads — for example, males in Missoula, Montana, between the ages of 25-34 who are interested in fishing; and Facebook delivers ads to those users through its own internal algorithms. Cambridge Analytica, by contrast, is accused of extracting personal data out of Facebook for its own political purposes.

Still, users have reasonable concerns about the types of data that Facebook is collecting, what the company is doing with it, and what Facebook is allowing other companies to do with it.

Adding to the collective data-gathering angst is the enormous amount of money that hinges on the outcome. According to eMarketer, Facebook is the second-largest digital publisher behind No. 1 Google, bringing in more than $36 billion in 2017. In the realm of digital display advertising, Facebook is No. 1 by a wide margin.

Cynically it seems likely that Facebook — and its youth-skewed Instagram platform — may use this moment to draw a tighter veil around the types of campaign data available to advertisers and the types of integrations that are possible with outside media platforms. If that happens, Facebook would become an even more rigidly “walled garden” than it already is. This would not be good for advertisers.

Another likelihood is that government regulations may emerge, perhaps similar to the European Union’s coming General Data Protection Regulation rules. (Indeed, Zuckerberg has asked for government regulation.) If new laws are enacted they could significantly restrict the types of targeting that are possible on digital media. The GDPR rules, for example, even disallow targeting by geographical location — ironically making newspaper and other traditional local media a potentially better choice for location-based targeting once those rules take effect.

All of this means that the right campaign strategies, media mix and messages will be changing frequently for the foreseeable future.

While the shakeout continues, we recommend advertisers take some basic steps:

  1. Watch campaign metrics more closely than ever. Keeping an eye on targeting options and reach within the specific platform to meet campaign objectives is key. If there are significant changes within the platforms that will not help you meet your goals and maximize the use of your budget, it will be time to evaluate / re-evaluate and look for alternatives. There are many factors that could influence your decision to revise your campaign or move funds to another platform, such as reach, cost per click, click-through rate or interaction.
  2. Employ rigorous A/B testing. While we always recommend A/B testing to enhance campaign effectiveness, it will likely become more important to fine-tune your campaigns.
  3. Review media strategies with an eye toward how date privacy changes could impact the blend of media you can or should use.

In the coming months we will be monitoring and adapting our own best practices on behalf of clients as changes take root on Facebook and other platforms. We remain optimistic that social media will continue to be a valuable tool for sophisticated advertising campaigns that talk to the wants and needs of our clients’ customers. We’re not ready to #DeleteFacebook … but we do think it’s high time to #MakeFacebookBetter.