What Facebook is Doing that Has Privacy Advocates Up In Arms

According to a recent article in Financial Times, Facebook is working with a company called Datalogix that can track whether people who see ads on their site end up buying those products in stores.

Datalogix has purchased data from about 70 million American households largely drawn from loyalty cards and other programs at more than 1,000 retailers. By matching email addresses and other identifying information associated with those cards against emails or information used to establish Facebook accounts, Datalogix can track whether people bought a product in-store after seeing an ad on Facebook.

According to Financial Times, “The emails and other identifying information are made anonymous and collected into groups of people who saw an ad and people who did not. Datalogix compiles a report for Facebook and its advertisers to measure which creative approaches and demographic targeting persuade people to buy specific products offline.”

Facebook and Datalogix have measured 45 campaigns and, in 70% of the cases, they’ve generated a 3 to 1 ROI. In other words, for every dollar spent by the advertiser on a Facebook ad, they generated $3 in incremental revenue in-store.

Despite the uproar this kind of activity has created for Facebook, it’s probably not anything you should be worried about, as I’ve stated below.

Why I Don’t Think You Should Be Bothered by What Facebook is Doing:

The Direct Mail Industry Has Been Doing this for 45 Years. Facebook isn’t the first organization to tie purchase data into marketing data. The direct mail industry has been doing that since the mid-1960s. Despite what privacy advocates have said, Big Brother isn’t controlling you any more today than he was in 1965.
Facebook Isn’t the Only Company Doing This. The truth is, just about every company that tracks data digitally is trying to connect the dots between an online view of an ad and a final purchase in a store. Facebook isn’t the only one — they’re just the largest one.
Datalogix Provides a Way to Opt-Out of this Program. Facebook users are automatically included in the advertising studies conducted with Datalogix and can’t directly opt-out via their Facebook account. They can, however, go to the Datalogix website and opt-out there. (We’ve provided the opt-out link here for those of you who would like to delete their names from the Datalogix list.)
Whether You Like it Or Not, You’re Just a Statistic. As much as you’d like to think Facebook or any other data company knows you as an individual, the fact is you’re just a statistic to them. Sorry. You’re a data point that’s part of a sea of other data points used to target people who are interested in certain products and/or services. Nothing more, nothing less.
You Can Always Opt-Out of Using Facebook and Other Social Sites. If you’re a huge privacy advocate or if you have something to hide from the rest of the law-abiding public, then you can simply opt-out of using social media sites and the internet and go on your merry way.

I’m sure my point-of-view won’t be shared by privacy advocates and vast swaths of people living in the woods of Montana and Wyoming. For those of you in that camp, feel free to leave your comments below. And if you’re on the other side of the fence — in other words, if you realize that this has been going on for 45 years with very little negative effect — feel free to leave your comments, too.

Posted by Jamie Turner, Founder of the 60 Second Marketer and co-author of “How to Make Money with Social Media” and “Go Mobile.” He is also a popular marketing speaker at events, trade shows and corporations around the globe.