How the proposed changes to Facebook’s ad targeting might affect your marketing

There’s probably no doubt that you’ve heard the controversy surrounding the ongoing Cambridge Analytica saga, in which the consulting firm improperly mined data from over 80 million Facebook users.

Much of the public and press were shocked to learn that third parties had the ability to gather personal information from Facebook under the guise of research and quizzes like, ‘what type of dog are you’ (I’m a pug by the way), and collected information from your account. These ‘fun’ quizzes allowed access to your friends accounts too. Other third parties, such as Experian, collected additional data such as offline purchasing activity.

These third party services started off fairly harmless. The initial idea behind gathering and sharing data was to ensure content was seen by the right audience, allowing marketers to buy ‘hyper-targeted’ ads. Then Cambridge Analytica took it to a new level.

As a marketer, this news may be unsurprising. You may have already heard of, or used, these social media targeting techniques. However, now that the larger consequences of improper data mining have come to light, there is a demand for higher standards of transparency and accountability in how data is handled.

Facebook CEO Mark Zuckerberg has publicly apologized for this breach of trust and promised to do better for his 2.2 billion users. This means Facebook is taking preemptive steps to regulate the way that data is shared to avoid any future privacy violations (and PR disasters).

These future changes could have a huge impact for marketers who rely on Facebook’s targeting and custom match paid ads to drive awareness, purchases, customer acquisition, and retention. But never fear, Custora is here to tell you everything we know so far.

The first major change is the shuttering of ‘partner categories’. This was an offering that enabled marketers to purchase advertisements against a targeting criteria provided by third parties. For the retailer, it’s not necessarily about the type of ad it uses to be effective; it is the ability to target certain audiences and reach a much larger group of people. Facebook is now cracking down on how much of this data it makes available to advertisers.

The second announcement focuses on user consent. Facebook will now require retailers to demonstrate the email addresses used in custom audience targeting were correctly obtained. This will be done through Facebook’s Custom Audiences Certification Tool, which is currently being built.

In both cases, Facebook is trying to make sure that retailers aren't using customer data that has been obtained improperly — either third party attributes that might have been scraped, bought, and sold without the user's consent, or entire lists of customer email addresses that might have been rented/licensed/purchased without the user actually having any interest in or relationship with the brand.

Luckily, Custora’s strong first-party data orientation is designed to protect against these kinds of abuses of data — while driving a superior ROI for advertisers. Furthermore, our API relationship with Facebook will not be affected by these recent changes.

Custora provides rich predictive insights specifically so that retailers don't have to rely on third-party data. And more importantly, we've seen that Custora's predictive custom audiences out-perform demographic data (including third party data from partner categories) by a factor of 2-6x. But don’t just take our word for it. Custora’s customers are consistently seeing a lift in return on ad spend when using Custora insights to create better audiences. Crocs used Custora’s high value segmentation to target lookalike audiences on Facebook and achieved an unbelievable 40x improvement on ROAS.

Additionally, all users included in Custora's customer base are those who have either transacted with the brand or signed up for the brand's email list, which would qualify under Facebook's definition of "email addresses that were rightfully obtained with user consent.”

The long and short of it is: Custora's first-party insights are good for brands and good for end customers. While we are fully compliant with Facebook’s changes, we believe that the crackdown is long-overdue. Personal data sharing should have limitations to ensure it is kept in the right hands. From a marketing point of view, this is good for customer experience too. We enable marketers to use data-driven targeting, that has been rightfully acquired, so messages can be seen by people who actually care about your company or brand.

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