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In March 2018, Facebook announced they would no longer integrate with third-party data providers that enable marketers to create targeted audiences on its platform as a response to the Cambridge Analytica scandal. Consequently, I wrote an article about this entitled Facebook’s Red Herring, because that is exactly what it was–a very artful distraction and attempt to deceive consumers into believing Facebook’s action was about addressing their privacy. But that is not what it was about.
The Cambridge Analytica scandal was about data leaving Facebook and being used in ways that were not authorized by participants of the survey. The decision to dissolve third-party data partnerships is about data that goes into Facebook to segment audiences for relevant targeting. However, what consumers have not seen the same publicity on is that Facebook has modified their stance on third-party partnerships so their data can still be used. The point I made in my article is that Facebook demonized third-party data providers in the press by announcing their dissolution of partnerships while avoiding the same public scrutiny around the real reason for their action.
Marketers can still append third-party data, which is compiled by a vendor to provide context, to a customer or prospect outside of Facebook and then ‘onboard it’ for digital marketing. Marketers simply need to sign an agreement with an onboarding provider that includes Facebook’s new terms and conditions. They can then append third-party information to customer lists and create target groups, or they obtain prospect lists of their target groups from a third-party data provider. From there advertisers onboard that data and upload it via Campaign Manager to Facebook. Some onboarders such as LiveRamp have third-party data available in their platforms so prospect audiences can be created and pushed to Facebook without the need to purchase the prospect list with personally identifiable information (PII) from the third-party data provider.
Regardless of how the marketer goes about it, once data is onboarded or audiences are created in an onboarding platform, they can be activated (used for media purchase) on Facebook. Voilá – third party data is still being used on Facebook. Facebook’s move to divorce themselves from third-party data did not mean it couldn’t be used, they are just requiring an additional step that many marketers are already proficiently executing.
If you are unfamiliar with how consumer data onboarding works, here is a short explanation: Consumer data onboarders like LiveRamp, Neustar and Oracle move offline marketing lists containing PII such as CRM data, loyalty databases, prospecting lists, etc., to the online ecosystem and match or link (via a common identifier such as email address) to cookies and device IDs in a privacy-compliant manner. The reason this matching is considered privacy compliant is because consumer PII is anonymized. Marketers never receive which specific cookies and device IDs are associated with the consumer profile.
Sorry dear consumer, Facebook’s dissolution of third-party data partnerships continues to be a red herring and does not prevent such data from being used on their platform. Furthermore, Facebook continues to collect and store first-party data (i.e., owned by them) on you that advertisers can leverage for target audience creation; and they have those rights because it is buried in the required terms and conditions you consented to when your account was created.
So, while Facebook has demonized third-party data in the press right after the Cambridge Analytica scandal (even though completely unrelated to the latter’s dubious use), they have not prevented its use. Frankly, I find Facebook’s use of first-party data and passive surveillance via their pixel on other websites resulting in those creepy retargeting advertisements much more intrusive then my being a member of a target audience based on my demographics and other modeled assumptions.
Consumer trust is the new “oil” in today’s data economy, and it requires more than lip service. Perhaps it is time for Facebook to figure that out.