After the Cambridge Analytica scandal, advertisers rethink Facebook data
Marketers might need a fallback plan for personalizing online campaigns, as precision marketing is at risk in the wake of the Facebook-Cambridge Analytica data scandal.
Regulation has never looked more likely for Facebook and its peers. Facebook founder Mark Zuckerberg has been called before regulators on both sides of the Atlantic to explain how it upholds user privacy. For an online ecosystem founded on companies like Facebook selling user data to advertisers, regulation could have big ramifications.
No advertiser has openly spurned Facebook yet. Instead, advertisers will wait to see how the threat of regulation develops, according to eight agency executives interviewed by Digiday. In the meantime, they are likely to investigate how their own campaigns and apps are using Facebook’s data.
“If Facebook were forced to change the way it uses data or the way its ad products work, then advertisers may become less enamored with it,” said Debra Aho Williamson, principal analyst at eMarketer.
Ultimately, “you must use your conscience, not just your data, to make your decisions,” said one agency executive, who noted that none of the agency’s clients have voiced concerns about the data breach despite being employed to manage Facebook campaigns. “The cost of advertising on the two biggest and most effective sites in the world is you need to be prepared to monitor them, and you need a policy in place about how you work with them.”
Establishing a data strategy that acquires and processes personal data the right way just shot to the top of marketers’ to-do lists.
“If you’re a CMO, then you’re looking at the way you’ve used Facebook’s data and seeing what tactics you can move away from that will still give you reach, but have zero liability,” said another agency executive, who spoke to Digiday on condition of anonymity.
From the drop in Facebook’s share price to the spike in people researching internet privacy, the Cambridge Analytica scandal demonstrates the extent to which bad practice can damage consumer trust. The General Data Protection Regulation is a natural consequence of events like these and is more important than ever to brands.
Ed Preedy, managing director for GumGum’s European business, said the artificial intelligence company is now seeing brands “rightly scrutinizing how the data they use is sourced as well as exploring how contextual solutions can help serve relevant ad messages without the same reliance on data.”
Advertisers are thinking twice about how Facebook data is handled now and could be handled in the future. Scrutiny into the social network’s data practices could blunt targeting and measurement across all its platforms. If Facebook advertisers have less data to use or have limited access to third-party measurement, that could affect how much brands are willing to pay for its ads, and consequently, the social network’s bottom line. Even then, observers believe the social network will pull through; a regulated Facebook would still be too big and brands hard-pressed to find an alternative technology giant that offers data as rich as its own.
“Advertisers have a shared responsibility with Facebook and Google to force change,” said Alex Miller, founding partner at agency Byte London. “We will have more influence by working collaboratively with the platforms rather than by threatening to boycott them.”
Facebook shares its regulatory woes with its peers. The web is littered with companies profiting from people’s data. Indeed, the share prices of Amazon, Apple, Netflix and Google also tanked amid the global backlash to the Cambridge Analytica scandal.
Matt Brittin, president of EMEA business and operations for Google, said he was “worried about consumers trusting technology” at such a turbulent time. When addressing the potential risks posed by regulation to Google’s advertising business, Brittin noted the difference between the intent data Google sells to advertisers and the more people-based alternatives from its rivals. Distinct from social, Google “neither knows nor cares who you are actually,” Brittin explained. “What we know is that someone in Kings Cross, London, is searching for running shoes.”
“When it comes to Google, the advertising value is created because of our ability to connect intent to an answer that is commercially valuable,” Brittin said. “We don’t have social graph data on you, but we do make it possible for companies to combine their data, like CRM, with those [search] patterns.”
‘You’re not going to get it all right’: IBM CMO Michelle Peluso on managing through a crisis
As marketers manage another crisis, they are thinking about how to help their teams as well as how they should be advertising.
‘Stand for something’: As protests continue, tone-deaf influencer marketing is in the spotlight
Questions about diversity in influencer marketing, opportunism and the need for brands to get comfortable with influencers taking a stance on politics and racial issues are bubbling up now as this may be a moment of self-reflection for the influencer marketing community.
‘There isn’t a talent pipeline problem’: Confessions of a black advertising exec
In this edition of our Confessions series, in which we exchange anonymity for candor, we hear from a black media buyer who believes brands need to do more to support for Black Lives Matter and that agencies still haven't truly changed their hiring policies.
SponsoredVideo: Marketers discuss the future state of less interruptive in-stream ads
In a new video, experts from GumGum, The Martin Agency and Pinterest discuss the future of video advertising — and outline their vision for how video ads can be less disruptive.
Member ExclusiveDigiday Research: Over half of brands say they handle marketing ‘mostly’ with internal resources
Digiday’s quarterly benchmarking survey found that about 83% of marketers are managing their marketing either mostly in-house or completely in-house. That's up from the 55% of marketers six months ago who said the same.
Member Exclusive‘Our job is to sell’: Marketers, moving past coronavirus response, return to selling products
Marketers need to get back to the job at hand: Keeping the squeaky wheels of capitalism turning.