By now, you’ve probably heard the news: Facebook will no longer allow advertisers access to third-party data. It’s a logical next step for the network, which has come under increased scrutiny for its role in the 2016 Presidential Election, and most recently for sharing user data without permission to Facebook advertisers and advertising partners.
Facebook stock ($FB) took a hit as a result of the news, dropping 18 percent over the two weeks following the news, and while banning Cambridge Analytics from their platform was certainly an expected response, denying advertisers access to all third-party data is a more drastic step. However, it was a step that they needed to take to reassure investors, users, and advertisers alike that they’re committed to ensuring the security of their users.
Now that the dust has settled, Facebook’s advertisers are left asking how this announcement affects their marketing plans, budgets, and most importantly, results?
You may be surprised to hear this, but unless you’re in the 1 percent of the Facebook advertisers, or you’re targeting a very niche market (such as people who are interested in “pretending to text in awkward situations”), you won’t notice much of an impact on your marketing. Sure, the ability to target users by income is going to go away—and that’s not nothing, especially for brands that sell to or serve the more affluent—as is the ability to target users based upon the number of kids that they have or how many bedrooms are in their home.
There are ways for advertisers to cope with this and even get around it if they’re willing to do just a little bit of extra work. We’ll detail that in just a minute, but first, let’s remember why we’re here in the first place.
Why is Facebook turning off access to partner data?
It’s not just the scandal with Cambridge Analytica. The start of GDPR (General Data Protection Regulations) in the EU on May 25 means that advertising platforms globally will need to be more thorough in ensuring that data cannot be mapped directly to individual users, and Facebook taking this step will help ensure its compliance with a ruling that could cost them 4 percent of their annual global earnings if they don’t.
What will be missing?
This is not an exhaustive or verified list, but some of the things that we anticipate that Facebook advertisers won’t be able to use as audience criteria anymore include:
- Income (different from Household Income – HHI – which is publicly available)
- Purchase Intent (including the types of stores users are likely to shop at)
- Job Roles (particularly corporate executives, but keep in mind that Facebook removed targeting by education, field of study, job title and employment in 2017)
- Targeting by race (never explicitly an option, but Facebook has stepped up to remove racial signifiers in ads targeting in the past year-plus) or sexual preference (which was removed recently for reasons not related to the third-party data updates)
- In-market audiences
We found that Facebook had placed people into all sorts of bizarre categories such as people with an interest in “Breastfeeding in Public” and “Pretending to Text in Awkward Situations.” /5
Full dataset here: https://t.co/sSAj1xYfJ6
— Julia Angwin (@JuliaAngwin) March 29, 2018
What won’t be missing?
Again, this isn’t a verified or complete list, but it should provide some idea of what types of information is still out there for advertisers to use for targeting:
- User behavior data (i.e. whether a user is more likely to use credit cards or cash)
- Brand Affinity (including, but not limited to, brand pages that users like or would be interested in)
- Household income
- Homeowner status
- Relationship status
- Age, Gender, Location, Page Likes
Where did Facebook come up with some of this data, anyway?
While a lot of the data in question does indeed come from third-party sources such as Experian, Oracle, and Acxiom, a lot more of it comes from Facebook users themselves. Shocked? Don’t be.
We also found that 600 of the 29,000 categories Facebook offered to advertisers were from data brokers. They were extremely specific and often financial, such as income between $100k and $125k or frequent shopper at dollar stores. /6https://t.co/S4Yo2nEa1T
— Julia Angwin (@JuliaAngwin) March 29, 2018
If you were a member of Facebook in its early days, you may recall that you could list your interests in freeform so long as they were separated by a comma, each of your interests would appear in your profile, regardless of how far-reaching they seemed, how culpable or innocuous they made you seem or how genuinely ridiculous they were. I should note here that I know people who have listed “pretending to text in awkward situations” as an interest—and this was back when T9 was the default method of sending a text.
Excuse me while I pour one out for my 20-year-old self.
In 2010, Facebook required users who had listed any interests to either renounce that interest or to join a newly-created “community page” dedicated to that topic. Essentially, they programmed a community page for any and every interest that had been expressed by the platform’s then-480 million users and required people who shared these interests to subscribe to an RSS page for that interest. They were asking users to confirm whether or not they actually were interested in that thing—and yes, 2.9 million people told Facebook that they were, in fact, interested in Pretending to text in awkward situations.
It’s a long way of saying that not all of this data is purchased by Facebook from third parties—a lot of it was given to the network consensually, whether users knew it or not.
What’s next for Facebook advertisers?
As I said at the beginning of this post, there are going to be a lot of Facebook advertisers—those who only use the platform because of its advanced display inventory, those who only use it to target locations, genders, ages or affinities—that aren’t going to be affected by this change. For those who are affected, however, there are a few steps to take.
First, audit your advertising audiences. This seems obvious, but not everyone—not even every Facebook advertising agency—is going to do this. Some won’t conduct the proper levels of review, while others will just pull their money from the platform, creating an opportunity for their competitors to gain access to more inventory without spending more (and as competition decreases, costs will likely dip too). Make sure that those audiences don’t contain any third-party segments.
You’ll know when you’ve found third-party data because Facebook will tell you.
If you see the “Source: Partner Category…” disclaimer in the bottom right of your selected audience target, know that it’s going to go away. And if you’d like to learn more about what new type of target you should use to replace it, we’d be happy to have a conversation with you.
Next, create new ad sets that don’t feature this targeting.
This doesn’t mean that you should create new ads because you can duplicate existing ads into a new ad group with only a few clicks. It just means that you’ll want to create new ad sets that don’t rely on Partner Category data for targeting. A few examples of how this could be done:
- Use Household income instead of Income
- Use Interest targeting instead of In-Market targeting
- Pair age, gender & location targeting with affinity targeting
Finally, create ads that speak more directly to these new audiences
This change will cause some concern initially, but it’s actually an opportunity for marketers to better target and better analyze how their messaging resonates with their core audience. Embrace that opportunity, and treat it as a chance to start fresh with a platform that still offers endless creative and targeting opportunities to help grow your brand’s awareness and authority.
