The news is true: Facebook will no longer allow advertisers to purchase or use 3rd-party data for targeting. A statement released to Click Here Publishing from Facebook confirmed this news:
“Over the past week, we announced important changes to reduce the amount of data that apps can request from users and ensure that people have more control over their information on Facebook. Now, to build on these efforts, we are going to be more restrictive in the way that we use data for advertising on our platform, particularly as it relates to information from third-party data providers.
Specifically, over the next six months, we will remove the ability to use
Partner Categories, a targeting solution that enables third-party data providers to offer their targeting directly on Facebook. While leveraging third-party data is a common industry practice and we’ve put good protections in place, we believe this step will help improve people’s privacy on Facebook.
We understand this may impact your advertising efforts on our platform, and we will work with you through this transition. In an attempt to minimize disruption, we will allow time for you to update your targeting. In light of the General Data Protection Regulation (GDPR) in the European Union, we have created a timeline to comply with the regulation:”
Why the change?
Facebook has announced the change to personal data usage after the recent updates in the Cambridge Analytica scandal. The beginning of this scandal occurred in 2015 after a huge Facebook data leak. Many believe this data was used to skew perspective of the election and encourage Russian involvement.
So, What are Partner Categories?
Partner Categories are anything added by request. This includes Oracle, Axciom, Experian, TransUnion, Datalogix data for owners of specific vehicles, Mastercard spend categories, Visa spend categories, Polk data information about specific vehicle shoppers, and comScore TV data showing exposure to certain shows or TV ads.
Giving Time for Change
The first phase of this is happening quickly in other parts of the world. Audiences pulled from UK, Germany, and France data will be discontinued May 25th. After that date, campaigns using this targeting will cease to deliver.
Luckily, for US advertisers, these campaigns have a little longer to phase 3rd-party data out. Advertisers can continue to add and integrate 3rd-party data into their campaigns until the end of June. Facebook will begin prohibiting the addition of these categories to new ad accounts beginning in July. Accounts with the 3rd-party targeting already added can continue to run as is until October 1st, as long as no changes of any kind are made.
No Need to Freak Out Yet
While this may seem like a blow to Facebook advertising, especially for automotive Facebook advertising, this is a great opportunity to explore more custom advertising solutions based off of customer engagement. Custom advertising solutions can be built by targeting residents of a particular geographical location and then using their engagement of higher funnel advertising. Ads can also be served based off of behavioral interests declared on Facebook and used to serve more relevant ads to smaller groups of people.
Many people don’t know that excluding the use of these 3rd-party data sources can actually make your ads less expensive. By using 3rd-party data, you consent that up to 15% of your advertising spend may be used towards managing the cost of Partner Categories. Facebook elaborates about partner categories here.
By removing the use of Partner Categories, you will likely reach more people in your targeted area or increase your current frequency.
1st-Party Facebook Data
Going beyond those initial tactics, using what our industry is now referring to as “1st-party data” will become even more important. 1st party data is self-derived, not purchased. 1st party data includes website remarketing, serving ads to people who have watched your videos or using your CRM data list to create your audiences.
2nd-Party Data – The Lookalike Audience
This 1st-party data which is relevant to your business can also help you create 2nd-party data – your lookalike audiences. Lookalike audiences can be created from your original data list to get new Facebook users who may also be interested in your business.
Lookalike audiences work like this: John buys your product. You have John’s info. You run John’s info through Facebook and Facebook pulls John’s friend, Bruce into the lookalike audience, because they both live in the same area and have the same hobbies.
Facebook does not serve the ad to John, they serve it to Bruce, who shows a high propensity of being interested in purchasing your product too.
While the removal of 3rd-party Facebook data is happening, we still have time to use the data and plan for future campaign changes. This will be an opportunity to use more custom audience sets per client and allow us to be more creative with moving users down the purchase funnel and being there for all the little micro-moments in between.