Last month, Mark Zuckerberg appeared before Congress to testify about Facebook’s mishandling of data. His testimony to senate committees was due to a recent scandal where it was revealed that Cambridge Analytica, a consulting firm used by the Trump campaign, misused the data of 87 million users to profile voters. Shortly after, Whatsapp founder Brian Acton started a twitter hashtag that took off urging people to “#deletefacebook.” Other celebrities and influencers followed suit, with Tesla’s founder, Elon Musk, posting “What’s Facebook?” and deleting his companies’ accounts.
How is Facebook Responding?
Facebook recently confirmed they will no longer provide data from third party aggregators from ad targeting. The company also said they are using artificial intelligence to monitor future election interference and have added 5,000 positions in security and community operations. While artificial intelligence has greatly improved, it is still not able to catch context the way a human can. Lastly, Mark Zuckerberg said Facebook would investigate all applications that have access to large amounts of consumer data.
Growing Consumer Discontent and Distrust
What are the foreseeable consequences of growing consumer distrust? It is likely advertisers like Facebook could face a regulatory backlash. That said, according to a Reuters online poll, only 41 percent of Americans trust Facebook to obey personal information laws.
How Will This Affect Advertisers?
A growing concern in the advertising industry is that if Facebook restricts the data available to advertisers it will negatively impact their ability to effectively target in their digital advertising campaigns.
A few notable brands have pulled their advertising because of their concerns about the violation of privacy. Mozilla, an open source web browser, and auto parts retailer Pep Boys both have stated they will pull their advertising due to the breach.
Most advertisers say they will continue to advertise on the platform. With over 2 billion users, and no strong contender for an alternative, they can’t ignore the platform. It is unlikely a mass exodus could happen. Many users have been on the platform for decades and have an extensive network they have built over the years.
It’s too early to determine if the latest breach will have a significant impact on advertising. That said, advertisers should look out for new changes in regulations and data privacy moving forward. These could have a lasting effect on digital advertising and the use of data for campaign targeting. On May 25th, in the EU, General Data Privacy Regulation or GDPR goes into effect. It is possible that similar legislation could be implemented in the United States, as Americans closely watch the results of this legislation. For now, advertisers will have to wait and see what is next.