Facebook Outlines New, Privacy-Focused Approach to Advertising, In-Line with Industry Shifts

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Facebook Outlines New

Facebook Outlines New: For Facebook advertisers, this is a significant shift to note.

After its initial strong opposition to changing approaches to tracking user data that placed significant restrictions on the information the company could use in its ad targeting processes, Facebook now seems to have acknowledged that this is the new normal, and that it will have to work with app owners to update their systems to better comply with new restrictions on accessing audience response information to ads.

As Facebook explained:

“As Apple and Google continue to make changes to their browsers and operating systems, and with the changing regulatory privacy landscape, it’s important to recognize that digital advertising must evolve to be less reliant on individual third-party data. That’s why we are investing in a multi-year effort to build a portfolio of privacy-enhancing technologies and are working with the industry to develop these and other standards that will support this new era.”

Indeed, Apple’s App Tracking Transparency (ATT) update, which was introduced in April as part of 1OS 14.5, is already having a significant impact on the digital advertising sector, with Facebook advertisers in particular still adjusting their approaches and developing the best ways to mitigate the loss of audience information.

The true impact of the ATT changes is still evident, but reports indicate that more than half of all iOS users refuse to track apps when they are shown new tooltips.

This has led many to rely more heavily on a broader range of data tools to determine response to ads — but Facebook soon says it will have a range of new opportunities to consider in this direction.

Helping to provide greater insight within these data limitations, Facebook is developing a set of privacy enhancing technologies (PETs) for advertising that will minimize the amount of data collected and processed to help protect personal information, but also make it easier to understand campaign effectiveness.

“We believe PETs will support the next generation of digital advertising, so we are investing in years of work with academia, international organizations and developers to create solutions and best practices.”

Facebook says PETs will include “advanced techniques drawn from the fields of cryptography and statistics” that minimize processed data while preserving critical marketing functions such as ad measurement and personalization.

Facebook is exploring several ways to apply these approaches to new measurement solutions.

“Last year, we began testing our Private Lift Measurement solution with select partners, which uses a privacy-enhancing technology called secure multilateral computing. It helps advertisers understand how their campaigns work, while adding additional layers of privacy to limit the information that can be obtained by the advertiser or Facebook.”

Facebook says Private Lift Measurement will be available to advertisers next year and is also working on additional tracking tools, such as secure multilateral computing (MPC), which allows two or more organizations to work together to share data while limiting the information each party can learn.

“Data is encrypted end-to-end: during transport, storage and use, ensuring that neither party can see the other party’s data. MPC is useful for increasing privacy when counting results from more than one party, such as when reporting the results of an advertising campaign or training a machine learning model where the data belongs to two or more parties.”

Facebook is also exploring on-device learning, which will provide information about ad performance without sharing individual data, among other approaches to a new privacy-enhanced landscape.

Like Google’s Privacy Sandbox project, which aims to limit data collection but still track ad effectiveness, these new tools are designed to find some kind of middle ground so that marketers can maximize their ad spend while still meeting the growing demand for data control and restrictions from consumer groups.

But in order to leverage these new approaches, Facebook will need the cooperation of the industry:

“These technologies will only be successful for people and businesses of all sizes if there is industry collaboration and a common set of standards. That’s why we encourage platforms, publishers, developers and others in the industry to work together – on these technologies and other privacy-focused standards and practices.”

Facebook hopes that now that the initial implications of Apple’s ATT update have become clear, more industry groups will be forced to come together to find solutions – though that will depend on what the implications are for each platform and organization, and some are certainly happy to see Facebook losing its position as the clear leader in digital ad tracking.

Some platforms, such as Twitter, have said that they don’t see serious consequences from the ATT update, while reports also suggest that Facebook will be most affected by the change. Given its dominance in the digital ad space, perhaps some won’t be as eager to help it regain ground in this regard, while individual advertisers, who are also moving to first-party data tracking, may end up relying less on Facebook data to measure the effectiveness of their ads, which will diminish the impact over time.

That’s why Facebook needs to push now. And it’s clear that small advertisers, who lose the opportunity to hone their campaigns and cut ad spending by optimizing based on such data, will suffer the most from this change.

Perhaps by working with small business groups, Facebook can get this change adopted as an industry standard. But either way, it’s an interesting shift that will have a major impact on the entire digital advertising sector.

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