My POV on Facebook’s Recent Privacy Challenges

What was once considered high-priced influence — to change customer buying habits, or impact voter behavior — is now within reach of anyone with a smart phone and a few hundred dollars.

I see this commoditization from multiple angles — as the CEO of a digital marketing agency, as a digital policy wonk (computer science/Cornell, business/Carnegie Mellon), lifelong reader of all-things psychology, and as someone who grew up in a country where foreign governments routinely influence elections.

Digital tools, like all tools, are inherently neutral. Whether they are used for greater good or nefarious ends depends on who uses them.

Some data-informed digital economy innovations have been embraced by consumers (Amazon, Netflix and Spotify recommendations engines).

Other uses of data and digital reach (Target’s “are you pregnant” algorithm) proved to be more invasive and presumptuous. Not every woman who buys large cotton balls, scentless soap, hand sanitizers and washcloths welcomes coupons for baby products.

Still other uses of data and digital reach may be seen as dystopian. Paid social ads that discourage citizens from exercising their vote — or worse, foreign governments influencing our elections with fake social media accounts and manufactured “news” are far more troubling.

Facebook Troubles

Facebook, as a leading attention merchant, finds itself in the thick of deep controversy. Its privacy practices, its partial reliance on data from corporate partners, and its lack of transparency to users are under scrutiny. It has become associated with the wide dissemination of fake news. Its algorithms appear to be cocooning us by serving up similar content with increasing shock value. The net effect of this is that Socratic dialogue and the ability to compromise are being endangered; our elections were partly hijacked by foreign actors who are sowing deep divisions in our society, putting even our democratic ideals at risk.

How has Facebook Responded?

Facebook, attempting to regain public trust, is beginning to make the following changes that will be completed in the upcoming months:

• Expanding privacy protections and making them more prominent. For instance, a Facebook user can choose not to be targeted based on his/her religion inclination, marital status or political affiliation.
• Cash rewards are being promised to people who report data abuse.
• Data access is being restricted on all apps. This includes limiting access to the events people attend, stricter protocols for gaining access to Facebook API, and restricting targeting people with religious and political affiliations.
• Closing the loophole for finding a person by phone number or email, a feature that was abused to gain access to additional information about a person.
• Increasing transparency to show people the source of political ads and news.
• Adding safeguards to prevent the creation and management of fake accounts.
• Phasing out corporate partner categories and relying solely on use profile data and their engagement habits with the Facebook platforms. This’ll end reliance on third party data such as home ownership, investments, credit card spending habits, and more.

What do Facebook Changes Mean on a Practical Level

App developers who rely on Facebook APIs, especially the ones who have been pushing the ethical limits, will face more roadblocks.

Facebook users will be the largest beneficiaries of these changes. In turn the Facebook advertisers will benefit too. Should a user take the time to refine the types of ads they wish to receive, the advertisers will now reach more receptive and right-fit prospects. We expect increased reliance on Facebook features such as lookalike and interest targeting – both based on Facebook’s secret sauce.

Facebook targeting based on political and religious preferences, and third party data will no longer be available. Facebook advertisers will increasingly rely on Facebook lookalikes and interest categories to create micro-segments.

We expect cocooning to continue since users are not likely to opt-in and see the news and ads with opposing points of view. Our pessimism is fueled by the broader shift away from liberal arts education towards practical education.

Finally, we expect foreign actors to increasingly influence our elections by making long term investments in cultivating authoritative sources sympathetic to their interests. Democratized digital tools have also democratized political influence.

Our Advice to Our Customers

Your ability to reach right-fit prospects should improve as Facebook users proactively manage their privacy settings. You’ll have to get more creative in defining and crafting micro-segments. While you’ll spend more time managing and testing the lookalike segments, Facebook and Instagram remain two of the most powerful tools to reach prospects. For that reason, we recommend you continue to use Facebook smartly.

Appendix: A Quick Primer on How Did We Get Here

Three forces have converged to create our current data privacy crisis.

1. Insights IN PSYCHOLOGY regarding INFLUENCE AND MOTIVATION.

In the last 65 years, deep research has been conducted, and hundreds of books have been published on how to influence and motivate people.

2. Pervasiveness OF MEDIA CHANNELS.

A hundred years ago, newspapers and other print wares were the tools of influence. Then came outdoor advertising, film, radio and television (broadcast, then cable). Most recently came the internet, which gave birth to Google and social media companies like Facebook, LinkedIn, Twitter, Instagram, Pinterest, and Snapchat.

3. Technology Revolution

Three technological revolutions have converged to escalate the privacy crisis.

• I. Computer speed soars (Moore’s law) while data storage costs have dropped.
• II. A sophisticated set of algorithms have been invented — like machine learning, data mining, predictive inferencing — to make meaning out of big data. Google, Facebook, Twitter and other channels have turned user data into a business model — offering advertisers clearer segments, cheaper ad buys and pinpoint targeting.
• III. “I Agree” and “I Accept” boxes have proliferated. This seemingly innocuous device has enabled data sharing between brands and between brands and governments. Every time you check off the box and click, you give away your privacy to others.

The combination of big data crunched by faster machines, and imbalance of corporate, government and individual power has led to the current privacy crisis in the U.S. Europe, where the balance of power has always leaned towards citizens, has done a better job of managing privacy.