If you’re a privacy advocate you might find it creepy or worrisome. But if you’re a marketer, you might be thrilled by the moves that Facebook is making to bring the online and offline worlds together.
AdAge highlights a number of initiatives that Facebook has undertaken to both show the offline sales impact of its ads as well as to bring offline consumer data to online targeting. Both involve the two-way flow of consumer data between online and traditional offline databases.
Facebook isn’t the first company to try any of this, but its scale puts it in a better position than others to successfully execute.
The hook for the article are several recent data partnerships that Facebook has initiated, including with Epsilon, Acxiom and Datalogix. According to the AdAge article:
Facebook is partnering with data giants including Epsilon, Acxiom and Datalogix to allow brands to match data gathered through shopper loyalty program to individual Facebook profiles, much like it’s done previously with marketers’ customer data from their CRM databases. Datalogix, a company with a rich trove of loyalty-program data, gained notice last fall after Facebook partnered with the firm to decipher whether users exposed to ads on the social network ended up buying any of those products in stores.
The bulk of the piece, however, goes on to discuss Facebook’s Custom Audiences targeting, which we previously covered. Custom Audiences enables marketers to upload and segment their CRM databases and find those corresponding individuals on Facebook. In turn, this allows for highly personalized and uniquely targeted ad campaigns. Match rates are typically much higher on Facebook than other online sites or ad networks.
Facebook’s more recently announced Lookalike audiences tool enables marketers to reach new users on Facebook that match Custom Audiences’ profiles and thus extend the reach of that product.
I had an extensive discussion with Facebook about privacy safeguards in Custom Audiences. And I imagine that all the programs rounded up in the AdAge article offer privacy controls to varying degrees. Still, the amount of information now available and flowing through the broader Internet and marketing ecosystem makes many people who know something about all of it uncomfortable.
There are a number of privacy bills in Congress, and the FTC has recently stepped up its privacy advocacy and scrutiny. It’s not clear whether any legislation will be passed in 2013 around privacy and the use of consumer data. However, the ambition is to pass something comprehensive that covers both online and offline third-party data collection.
Regardless of whether any new legislation is passed, the FTC arguably has authority to intervene in any situation involving a perceived misuse or abuse of consumer data. Yet so far, absent some egregious episode, the FTC has basically exercised restraint (though Google and Facebook have both settled FTC privacy investigations). The agency also recently issued a mobile privacy report with some sweeping (and potentially burdensome) recommendations that many in the industry find distasteful.
The Europeans are taking an even “harder” line on privacy and asking for more publisher/network transparency, explicit permissions and user control over whether and how data are used in marketing.
The stuff that Facebook is doing with company and consumer data, bridging online and offline, is very innovative and may dramatically change online marketing over the long term. However, the company should also be exceptionally clear about its privacy safeguards in place.