In an attempt to address growing privacy and security concerns, Facebook has announced that they are shutting down Partner Categories. Yesterday, they revealed that they will slowly abandon the advertising tool over a six-month period. It comes to no surprise that Facebook is ceasing activity with third party data providers given the rough few weeks they have had following the Cambridge Analytical scandal.
It is easy to see how Partner Categories could turn into another PR disaster for Facebook. They have received a lot of backlash in recent weeks due to their data privacy practices. Cutting off advertiser’s access to Partner Categories seems like a prudent move while they are trying to repair their image with the public.
While Facebook users will probably take comfort in this change, it could be bad news for advertisers. The tool was designed to help target relevant users by providing advertisers with more insight on their consumers. However, for Facebook users, it feels like more of an invasion of privacy than anything.
What are Partner Categories?
Partner Categories became available as targeting options in the platform in 2013 with the goal of helping advertisers reach their target audiences. The tool can be used to reach users in the United States, United Kingdom, Brazil, Australia, France, Germany, and Japan.
Facebook partnered with data brokers, such as Oracle Data Cloud, Epsilon, and Acxiom in order to gain more insight on their users’ daily activities and interests. The tool uses the third party data to segment users based on the information they collected, and in turn, advertisers could use this data to target relevant audiences with their ads. It should also be noted that there is a charge for using partner categories, and many advertisers did not realize this.
Essentially, these major data brokers collect information about users that is not available to Facebook, like what type of car you drive and when you bought it. From there, these data brokers pass your information along to Facebook and they link the data to your profile. Consecutively, audiences are segmented into meaningful groups, and are shown advertisements that are relevant to them.
For example, if you wanted to advertise home refinancing, you could use Partner Categories to narrow down your audience to homeowners, whose home market is in the range of $250,000-$500,000, and primary spend using their credit card.
What happens now?
Facebook confirmed to Techcrunch that this is a permanent change. They also stated that they would to continue to work with these data mining companies to “measure ad performance and provide metrics”. In the future, Facebook intends to review their partnerships with these companies.
Many advertisers do not use Partner Categories, but for those who do, they have a transition period of a few months before it is fazed out completely.
Over the last week or so, advertisers have noticed that their Facebook campaigns have not been performing as well as they had previously. Many people were running very broad campaigns, and they were simply relying on the Facebook Pixel to optimize their audience for them. Could the recent decline in performance be due to the Facebook pixel no longer using these partner categories in its optimization?