Tag Archives: Facebook

If it’s free, you’re the product

Having been in the media industry for *cough* 20 years this year, the scales fell from my eyes a long time ago. I assumed that everyone approached media and advertising with the same slightly raised eyebrow as me, so when people who don’t work in media (and hence probably do real jobs) express righteous anger at Facebook redesigns, their dwindling sense of privacy or misguidedly share one of those annoying “I hereby do not give you right to do blah blah…..” notices I am genuinely surprised that some people really haven’t figured it out.

For the avoidance of doubt, Facebook is a commercial entity, as is Google, as is ITV.

They are not publicly funded like the BBC, therefore their sole reason for creating ANYTHING is to make you use it and watch it – so that they can sell advertising around it. In addition to that, they can get more money for their advertising if they know more about their audience (yes, that’s you).

To give an example – imagine that Disney are selling their new animated kids’ movie. They may be willing to pay a certain amount for their ad to be seen in front of a thousand people. If those people can be proven to be parents, then their perceived value of those eyeballs grows. This makes the newspaper/magazine/TV station/website publisher much happier, and gives them an incentive to find out as much about you as they can, to increase your value to their advertisers.

If there is even further information available about viewers/listeners/users, such as the age of their children, whether they’ve liked other Disney animated films and if they’ve visited one of the Disney Parks in the last 12 months – that value can further grow enormously as it’s a good indicator that they’re more likely to buy the advertiser’s product.

Here’s an example of how it works on Facebook:

Facebook audience targeting

Facebook audience targeting

For the basic UK adult targeting above, Facebook recommends a CPC (cost per click) bid of between 25p to 54p, How much of this you’ll have to pay will depend on how fast you want to spend your budget, and supply and demand at the time you go live.

Now see what happens if you add some extra criteria about family status:

Facebook audience targeting with children

Facebook audience targeting with children aged 4-12.

As you can see, the number of people in the target audience has dropped (to less than 10% of the original number), and the price you’ll have to pay to show them your ads has increased, by about 30%. If these people respond more frequently to the ads and therefore the advertiser sells more DVDs, then it’s evidently still worth their while to pay a bit more, so everyone’s still happy.

But how much do they really know about me?

Well traditionally “brand” advertising has been sold around content, so you’ll see different ads around America’s Next Top Model than you do around Wheeler Dealers. The assumption is that certain types of people (gender, age bracket, purchasing habits) trend towards certain content.

Direct advertising, and especially since the growth of the internet is more likely to be sold around what we know about the person themselves.

ACORN advert for regional classification

ACORN advert for regional classification for advertisers

The 80s saw the launch of ACORN (A Classification of Regional Neighbourhoods) in the States, which segmented all US areas into demographic types – which was used to help advertisers to accurately target their direct mail and later TV, and now online across most countries.

Clearly people living in areas classified as “02 – Affluent working families with mortgages” will be worth more to the advertiser than “48 – Low incomes, high unemployment, single parents”.

It has ever been thus and means that where they can, advertisers will use the most detailed criteria available to increase the response to, and decrease the wastage of their advertising activity.

Social media, and people’s increasing willingness to share personal data has led to an explosion in the levels of targeting that an advertiser can access. To continue the Disney/Facebook example:

Facebook targeting options, Disney

Facebook targeting options, Disney films

There are so many targeting criteria that can be used to target the Facebook audience, and all these options make the audience more valuable to the advertiser (and to Facebook). Disney films, parks and characters can be added to the interest category, and these people set up as a segment so that they will see the ads that are most targeted to them.

If the advertiser wanted to target grandparents also – say in the run up to Xmas, they can add extra age criteria to make it more relevant and tweak the ads even further.There is a segment called “babyboomers” who can be lured with nostalgic references to childhood toys of their youth.

Spooky?

Those who see the level of detail advertisers can access for the first time often react with horror – OMG!! They’re going to sell me stuff!!

Well my answer to that is

a) did you really think you get anything for free, really? and

b) at least the stuff they’ll try to sell you is vaguely relevant.

I’d be very bored very quickly if all the ads I ever saw were for golf equipment and incontinence pads (neither of which I have a need for, incidentally).

If you feel worried about your privacy then there are always ways you can prevent advertisers from knowing more about you.

  • Firstly, don’t be hanging around on Facebook. It’s like carrying a sandwich board around with you telling them how to sell to you, and when. If you must do, then set your posts to automatically show to “friends” only (not public), and don’t like/share ridiculous images that *obviously* aren’t going to suddenly start moving if you write a comment
  • While you’re at it, tick the “opt out” box on every form you ever fill in 
  • Delete your cookies after every online session
  • Go and live in the desert, although you may just end up re-classified as “Self sufficient, rejecter of society, interested in green issues”.

Frankly, it’s a part of the world we live in, and whether you engage with it or not is your choice. You will see ads around every media you interact with, but you only make the advertiser’s job easier if you volunteer information to them. Choose wisely and carefully what you share with the public and commercial entities, and remember:

Never write anything online that you wouldn't put on a postcard

Never write anything online that you wouldn’t put on a postcard

Facebook and Atlas

The first thing I knew about Facebook’s purchase of the Atlas ad serving suite from Microsoft last week was a trail of disbelieving social media commentary by colleagues saying “What? Are they insane?”. By “they” here they mean Facebook, as the overwhelming view amongst past and current digital media operators is that Atlas is a “pile of s***” and that Microsoft must be glad to be shot of it, even at the rock bottom price of $100million.

Facebook has an enormous job to do to regain the trust and support of the online marketing community for Atlas or anything else that they build based on its skeleton. I have spent the best part of the last 4 years complaining about Atlas to the tech support teams, to the product leads and vainly shouting and throwing objects at my screen when another huge spreadsheet of thousands of bespoke tracking URLs is lost in the ether at midnight when the campaign needs to go live by 8am.

When all pleading made no difference I made a very vocal point of persuading clients to move their advertising to other solutions wherever possible, and I am not the only one.

It wasn’t always thus – 5 or 6 years ago Atlas was the defacto ad server for every digital agency I knew, so much so that Google seemed to have played a slightly inferior hand with its 2007 purchase of Doubleclick, and Microsoft’s decision to buy Atlas seemed to make perfect sense.  MS did make a classic 2nd mover mistake of desperately throwing money at the problem however, and the purchase raised gasps throughout the market with its $6.3billion cost (Yes, $6.3 billion) – more than double what Google had paid for its acquisition.

Granted that $6.3billion cost (Yes, $6.3 billion) was for the whole aQuantive group, which also included Razorfish (which they later sold for $530 million) and Drive PM, which was absorbed into the Microsoft Media Network (and arguably did add value to the offering). This didn’t hugely impact the end result however, which was still that Microsoft wrote down $6.2billion in 2012, mostly due to the aQuantive purchase, for which Atlas is the biggest culprit.

So how did Atlas go from the dominant ad server in a growth market, to losing the entire GDP of a small country (such as Liechstenstein) in 5 years?

Without seeing internal figures its impossible to say how much Microsoft has invested in Atlas technology since its purchase, but as a user it’s clear that the fundamentals haven’t changed since the mid 2000s. Every team I have worked on has been shouting in frustration at the Atlas team for years about usability and how they literally *hate* using it. The only tech in advertising that stimulates more frustration is DDS (cue bloodcurdling scream).

In the 5 years since Atlas was bought there have been multiple changes in the digital advertising space along with the rest of the technology world, most if not all of which expose Atlas as inferior to more nimble competitors:

The growth of paid search bid management software 

Atlas search offers a very basic click tracking function rather than any operational help to the search operator. This means that any serious campaign will need another software such as Marin on top to ease the thousands of optimisation tasks and data analysis, which just adds cost to the technology stack, and yet more cookies with more potential data discrepancies into the mix.

Cross digital measurement attribution

Atlas “Engagement mapping” garnered a bit of support for about a minute until we realised that many competitor tags couldn’t be placed in the UAT (Universal Action Tag, their container tag solution). What’s the point in running an advertising campaign where your media choices are dictated by your tag provider, not their performance? Any cross-media tracking that exists needs to at least include all paid media (and preferably direct & organic driven traffic too), so again Atlas offers only a partial solution at best

Facebook & other social network launches

Facebook has obviously been a market changer for the advertising world, and its growth has also created a market for Facebook campaign management software. Good Facebook campaigns need hundreds of targeting clusters created to maximise creative performance, and this scale of tracking and the speed with which it needs to be done is impossible with something like Atlas.

Across all digital media many widely used technologies were developed to manage one type of media, but the market direction is towards bundling search, social and display management capabilities into the same technology. If that technology is already being used, such as the ad server (Doubleclick) or search bid management software (Marin and Ignition One) then the consolidation of technology saves an enormous amount of time and complexity.

The consolidation daddies of digital marketing technology are now Google and Adobe.

Google has an ad network, an exchange, an affiliate network an ad server and a free analytics suite sitting on the same technology stack as AdWords, the worlds largest global advertising platform. In the time it’s taken Atlas to lose all its customers, Google has totally rebuilt Doubleclick, and Doubleclick search, is adding new functions almost weekly.

Meanwhile Adobe’s frenzy of acquisitions in the last 2 years have added a Data Management Platform (DMP) and search management to its “Marketing Cloud” which now offers end to end creation, tracking and optimisation for video, social, search, site analytics and landing page testing.

While I understand that Facebook want to have access to technology that helps them to prove that FB advertising works, they’d have been better buying a small, nimble FB specialist plus a small ad serving company and building their own solution. Either way without site side analytics and/or search management their offering will not cover the full picture that a digital marketeer now wants to see (preferably with one login).

Add to this that unpicking someone elses’ tech to rebuild it and re-gaining the support of a busy, cynical group of people (with lots of shiny other options) is not a small task. Facebook will do well to learn from Microsoft’s mistakes that being the dominant force is not an unassailable position to be in. Watch out Facebook –

Only the paranoid survive.

Andy Grove