What marketing without the crutch of Facebook’s third party data will look like

With Facebook crisis op eds dropping left, right and centre, Victor Condogeorges provides a comprehensive guide to the reality of our post data-breach future.

Since Facebook publicly admitted to the Cambridge Analytica ‘data scandal’ which influenced an election back in 2015, there have been a number of changes happening in the advertising space for Facebook.

These changes have started to breach the background, with some changes that may impact the market dominance in the previously insurmountable duopoly they’ve held with Google.

I’ll list a few.

Facebook’s share price dropped significantly – its biggest drop ever – taking their share price back to what it was in June 2017.

Users have started to use the boycott hashtag #DeleteFacebook – which is gaining popularity both from peoplecelebritiesand bots. This is starting to fizzle out now as it turns out people have zero control over their addictions.

Users have ‘become woke’ to what the data that Facebook has on them means. Turns out consumers want privacy above relevant ads.

Publishers are starting to ‘quit Facebook’

Third party data partners aka “Partner Categories” have been cut.

Here’s what these (potentially) mean

Less investors

Investors may be a little more cautious with tech investments that are focused on gaining revenue by harvesting data to the point that they have started suing Facebook.

Thanks Christopher Wylie!

Wylie, the Cambridge Analytica whistleblower

Data aggregators which were previously at risk to GDPR mandates coming in now have that to deal with as well if they’re ever thinking about going IPO.

Less reach

So with this happening, there will undoubtedly be users leaving the platform and curtailing their addiction. Or at least trying to.

This means less reach. I don’t imagine it will be anything more than a little bump in the road for Facebook, but it is something that will be affected.

Reach and targeting has been Facebook’s one, two punch combo that has worked wonders for a long time in getting the platform to where it is today.

Users are more aware/concerned with data protection

This creates a great opportunity for third parties to create a shield for users and protect them from unauthorised data harvesting for political gain. Browsers like Firefox have already jumped on this.

Of course, there’s an irony here. Three billion Yahoo accounts were compromised and no one bats an eyelid. 50m Facebook users had their data used against them for political gain and the world loses its mind.

Less data targeting capabilities

The impact this potentially creates can be defined into two schools of thought from a media value front.

Less targeting capability will increase the cost per result, because you won’t be able to target the users you deem most relevant to your product.

Ads will be less relevant to users. There’s a heap of data in the Facebook platform, but that’s where it needs to stay. We never had a problem with it being there so long as it wasn’t used against us politically. That seems to be a taboo area for consumers to deal with, even though they’re influenced to consider purchasing products every day.

From the market’s perspective, the ecosystem needs to be as closed off as Apple’s. Third-party integrations will be closed, resulting in a garden that is even more walled off than before.

Pulling the pin on third-party data means there will be a crossover of time where people will have to learn how to do their targeting differently. Back how it used to be done. Define a persona, develop a segment, model the audience. Get under their skin.

Short term: Less clicks, less relevance, less results, higher CPC

Long term: Marketers that understand their audience better than a cookie cut “xx persona” or “xx segment” and develop a better way to find and understand their audience.

Less targeting capability will decrease the cost per result, because you won’t be wasting money on data you didn’t actually need.

While the data targeting capability with partner categories is powerful, typically the way it has been used in the past hasn’t allowed the system to have the same optimisation capability as a machine learning algorithm would do on an open field. No surprises here for those that believe in the algorithm, but let me play this scenario out to you.

You have a target audience of mums. You use third party data segment to target people who have purchased baby products in the past 30 days and have been identified and matched within the platform.

This data then costs you from 10-20% on top of your existing CPM, according to Facebook. Which means that by you targeting this segment only, it needs to work 10-20% more efficiently than an open plane that a machine learning algorithm can find you an audience for.

That’s right: you thought that people that buy baby products are your right audience, but the machine found out that people that are into cycling are more cost-effective for the outcome you’re trying to achieve, but you never gave it that opportunity to find that audience because you thought you were smarter than a machine learning algorithm.

My prediction

I am predicting the latter will happen. Some marketers will become surprised to see that going super granular on their targeting doesn’t achieve as strong a result compared to going broader and focusing on the context of the user, not just their behavioural attributes.

Context rules, we just never noticed because we’ve been distracted by the depth of data we can get out of the platform.

Some may feel discombobulated with this change for a short while. Meanwhile, us relics will feel back at home and have an opportunity to train the art of developing a segment and understanding an audience again, and for it to be adopted out of necessity rather than opinion.

The understanding of the audience will get deeper and the next wave of marketers who use paid social media will get a better result out of the platform and for their clients.

Targeting has way more depth to it than just picking that segment and targeting it. The PEOPLE you are targeting have other interests beyond that which has defined them as a segment. Now you will need to dig deeper to understand that the mum who buys baby food also loves reading a specific type of content, and that content is the best place to reach them, not their purchase history or cookies.

Victor Condogeorges is digital investment director at Bohemia Group. This article first appeared on LinkedIn.


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