Could savvy marketers take advantage of increased Facebook Custom Audience transparency?

Marketers can create Custom Audiences from a variety of sources. These include their own websites via a Facebook tracking pixel, as well as their own customer files. The latter, which match individuals to their Facebook accounts using information such as email address and phone number, have proven to be especially effective and thus popular with marketers.

At the same time, Custom Audiences enables the kind of advertising that some consumers find creepy. After all, many consumers might feel that they’re being stalked when they see this advertising because many, if not most, aren’t familiar with the ways that the personal data they supply to businesses they interact with can be used to target them on platforms like Facebook.

Perhaps with that in mind, Facebook, facing a seemingly never-ending string of bad headlines that has soured its reputation with consumers and intensified scrutiny of its practices, has made changes to Custom Audiences to reduce the potential for abuse, increase transparency and ensure compliance with laws such as GDPR.

What’s going on at Facebook, and will it affect advertisers?

Last year, the world’s largest social network began requiring marketers to certify that they have obtained consent to use Custom Audiences data they upload. Then it began requiring marketers to specify the origin of that for possible display to end users as part of a Why am I seeing this ad? tool that users can access if they want to learn more about why a particular ad is appearing in their News Feed.

The company also updated its terms to ensure that audience data shared by a company with a third party such as an ad agency was done with Facebook’s knowledge.

In 2019, the company has continued to expand what it reveals to users about the ads they see. In February, it announced the Why am I seeing this ad? section for an ad could display the name of the business that uploaded the user’s data and detail the specific information that was used to match the user to a Custom Audience.

Now, as part of a broader push to help its users understand why they are seeing content in their News Feed, Facebook has updated the Why am I seeing this ad? tool to include the names of any marketing partners with whom Custom Audience data was shared, as well as the dates on which the data was uploaded and, where applicable, shared.

An opportunity in the making?

This move won’t immediately affect Facebook marketers, at least as far as their ability to employ Custom Audiences is concerned. But that doesn’t mean it won’t have an impact.

Until now, companies have been able to advertise their wares in digital channels with a high level of confidence that the intimate details of their activities are largely opaque to the public. That is changing, and while consumers might not spend the time to investigate the whys and hows of the ads they’re seeing on Facebook, marketers should consider the possibility that their competitors could.

For example, with some effort, it’s not inconceivable that a company could find ways to use the transparency tools like Why am I seeing this ad? to learn about the data its competitors are collecting from customers and how they are employing that data in their Facebook ad campaigns. It could also use the tool to learn about marketing partner relationships that aren’t publicly known.

With an understanding of how their competitors are targeting their customers on Facebook, and which partners they are working with, savvy marketers might even be able to adjust their own Facebook marketing strategies to positive effect.

While hypothetical at the moment, companies would be wise to start thinking about how increased transparency could create competitive risks and offer new opportunities to monitor and respond to competitors.