https://digiday.com/marketing/facebooks-shutdown-third-party-data-affects-brands/
Source Image: digiday.com

What’s Going On?

On Thursday, March 28, Facebook announced in a very brief post that it will be shutting down “Partner Categories”, the product that “enables third-party data providers to offer their targeting directly on Facebook.” By shutting this down, Facebook will revoke the private access for data aggregators Acxiom, Oracle Data Cloud, Experian, Epsilon and others to Facebook’s data, as well as remove the third-party advertising targeting options that these third parties provided. Facebook will also be phasing out all private and public third-party capabilities from the site over the next several months (MarketingLand).

 

Why is Facebook Doing This?

There are two major reasons Facebook is making this move: Cambridge Analytica and GDPR. At this point, Facebook is doing anything it can to put out the fire that is the Cambridge Analytica scandal and gain back user trust. The move to shut down Partner Categories is just another step Facebook has made in recent weeks to improve its data practices. Although shutting down Partner Categories does not fix the breach exploited by Cambridge Analytica, it does represent a greater movement by Facebook to limit who can see its users’ data and clean up its privacy regulations.

 

Which brings us to the second reason Facebook is shutting down access for data aggregators: the GDPR. The EU’s General Data Privacy Regulations go into effect on May 25th, giving users more control over their data, and giving hefty fines to any company that does not follow the rules. Here is the official timeline of both meeting the GDPR rules and changing the Partner Categories:

  • May 10: After this date, you will no longer be able to create or edit campaign using Partner Categories built on audiences from the UK, Germany, and France; however, they will be allowed to continue running until May 24.
  • May 25: Facebook will no longer deliver to Partner Categories built on audiences from the UK, Germany, and France, and these targeting options will no longer be available for use on the platform. You will be notified to update any targeting containing impacted Partner Categories before this date.
  • June 30: Last day for creating new or editing existing campaigns using non-EU Partner Categories; they will be allowed to run until September 30.
  • October 1: All other Partner Categories will no longer be available as targeting options and Facebook will stop delivering against these audiences. You will be notified to update your targeting by this date. (Source: MarketingLand)

The important takeaway from this timeline is that firms and companies in the United States have a bit of a buffer until they lose access to the Partner Categories. However, even with an extra month compared to the EU, companies should still be preparing for strategies that do not include partner targeting on Facebook.

 

What Should We Expect?

The short version is that marketers are going to have fewer ad targeting options on Facebook. Without being able to use the same data from companies such as Acxiom, there will be fewer options for granular demographic and behavioral targeting on Facebook. While this could have some impact on performance in Facebook ad buying, marketers are still optimistic about using Facebook. In a recent Marketing Land article, one source stated “The direct-response targeting options that are not affected by this change, such as pixel-based retargeting, Custom Audience lists, and lookalike audiences will continue to function well and drive performance for most advertisers”.

 

The Custom Audience lists have become more important than ever. In general, these lists are created using first-party data gained from a company that is imported into Facebook for customer targeting. However, Facebook is now building a Custom Audiences certification tool to ensure that businesses receive the consent of users before using their data, especially for email lists. Tailwind’s source at Facebook has confirmed that third-party data is still usable, but it is on the advertiser to “represent and warrant that proper consent has been obtained for the use of any data uploaded to create a Custom Audience”. In reality, most of the changes coming to advertisers via the Partner Category and Custom Audience changes are simply Facebook adding teeth to the regulations they already had in place and, of course, cleaning up their act to try and get back in the good graces of the public.

 

So, What are the Next Steps?

When asked about who will be most affected, marketers in both MarketingLand and Digiday articles said that smaller businesses or businesses who heavily relied on third-party data through the Partner Categories instead of creating first-party data will struggle more. In that way, if you feel like a large portion of your eggs are in the Facebook basket, it might be time to start expanding your portfolio and gathering more first-party data. These changes will, in general, reduce the level of granularity with interest and behavior targeting, but this will not mean less-effective campaigns. Digiday stated that consumer packaged good companies have pulled back to wider-reach campaigns instead of hyper-precise targeting with strong signs of success. We might also see an increase in what 1st party data Facebook will offer on its own as these changes go into effect.

 

Ultimately, there is still a good amount of time before the Partner Categories fully go away, giving companies time to re-strategize. We at Tailwind do not believe in a single-pronged approach. Instead, we take a comprehensive approach to making your digital campaign soar. We believe social media is a place for highly personalized content and a place to discover. We seek to increase these experiences through good marketing and see these changes as one more step towards greater transparency online, something that we can all benefit from in the long term. Facebook taking responsibility, and in turn making advertisers responsible, for their users’ data can be a catalyst towards a more open and honest internet experience.  

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