The End of the Social Media Wild West Era
Announcements
There are about 200 to 250 million monthly active Facebook users above the age of 18. Cambridge Analytica gathered 50 million public profiles, roughly between 20% to 25% of the platform active users depending on whether you are a glass half full or half empty kind of person. Now Facebook is saying the breach was even worse, around 87 million people’s data. What does this mean for the future of digital advertising?
The Facebook scandal began because of Russian meddling and the unexpected election results. So, let’s break down the numbers. To reach 50 million people on Facebook 5 times in one month, you need approximately around $340,000, that is 23% of the people that voted (Voter-turnout-2016-elections) and 56% of all registered republicans according to Pew Research Center. According to the latest reports, Russia spent $1.25MM per month, definitely a game changer amount considering their potential reach and frequency. Moreover, this is using a relatively standard CPM, but fake news is usually really cheap.
Is this enough to win an election? From a pure media and digital marketing point of view, probably not. Did it make an impact? Definitely.
For people with vast experience in the advertising sector, and mainly on political campaigns, it is evident that a monthly budget of $1.25MM is nothing compared to the money spent on TV ads for a presidential election. So, what is the big deal? The privacy breaches? The Russian involvement? Alternatively, that finally, people outside the digital realm realized the potential and importance of Social Media.
IS FACEBOOK RESPONSIBLE?
Facebook’s CEO Mark Zuckerberg addressed the data situation with an acknowledgment of responsibility, “if we cannot protect your data then we do not deserve you". Both Google and Facebook’s ability for hyper-targeted campaigns is what is moving dollars away from traditional to digital. Moreover, maybe this is the problem, people do not like change, the status quo for some is everything that they know, and anything else outside of that frightens them.
Zuckerberg: “if we cannot protect your data then we do not deserve you"
Nowadays, everything that we do is recorded and used by marketers to create “personas” to give us better content and more relevant ads, our privacy is the cost of disruption and relevancy.
Moreover, regarding the data and its use for marketing purposes, sadly it is not new, it just got better. These practices had been around for a long time before Facebook and Google existed. In the past, we received mail, calls, and texts for products and services we did not want; I never authorized anyone to have my phone number, I am confident I did not give my phone number to a telemarketer or my home address, but to this day I am still being targeted… The difference? In digital we receive content aligned to our taste and demographics.
For example, I can tell you right now that out of those 220 million Facebook users we talked about, 49% are married, 62% went to college and graduated. They also click on 15 ads on average on Facebook, they like Groupon, and 48% of them use cash as their primary payment method. Also, 43% are buying pet products either online or in-store, and 81% of them have their pets in a house they own.
Knowing what we know, the dilemma is, do we use this information? As a business owner, would you want your company that sells dog food to be wasting money on the 67% that isn’t buying pet products? Moreover, as a user, would you like to get ads for dog food if you are a cat person?
WHAT DOES THE FUTURE HOLD?
The future now seems a little blurry. If the big tech companies do not handle the allegations properly, some restrictions could be put in place by Congress to avoid any breaches of privacy to end users. However, now we know for sure that Congress doesn’t have a clue about Facebook or digital, at all. So how can you regulate an industry you don’t understand.
Nevertheless, for now, everything is moving full steam ahead. Data mining and its use for digital marketing are just starting; Amazon’s latest business decisions: purchasing Whole Foods, Prime, Subscribe & Save, proves that they are all about learning everything there is to know about their customers. With this overflowing amount of data, any competent big data analyst will be able to create patterns of consumption and purchase behavior mapping; so get ready, it’s coming hard and fast.
In the very near future, targeting is not even going to rely on psychographic data. Instead, companies will show you an ad when it is precisely the right time. Why spend on a milk ad to someone that just bought a gallon, and according to their purchase history is not going to buy for another two weeks. Undoubtedly as a marketer, I shall serve them an ad then, and save the money now. It is immediacy and relevance at full speed. Moreover, it is not always noticeable or that far away either, VR and gaming can too be altered to show you content to influence your behavior.
The advertiser in me does not want you to have this next link, but as a token of good faith here is a Mozilla extension to help you not be tracked as much but know that in the digital age you are always monitored at least a little bit. For now, you can rely on Facebook’s self-regulation, removing third-party audiences might just be their first move in a series of PR related directions they are taking to keep their users and public opinion “happy.”
As a digital advertiser, I can honestly say, this sucks. However, stay on your toes friends, the targeting capabilities are still there, just disabled (for now) and as you read this someone is collecting your data and selling it.
P.S If you are interested to read more about this topic, here are some cool links:
