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The Cambridge Analytica Scandal: Adjusting Your Facebook Advertising Strategy in the Aftermath

Insights / 03.29.2018

Red Door

The Cambridge Analytica scandal has been an active topic of conversation in the digital advertising industry, with the growing concern around what data digital platforms have access to, and how they use this information to "speak" to consumers. We’ll break down the nature of the controversy, how Facebook, users, and advertisers are taking action, and what our experts at Red Door Interactive recommend as the best next steps for brands. 

WHO IS CAMBRIDGE ANALYTICA?

Cambridge Analytica is a political consulting firm, based in the U.K., that focuses on gathering voter data for political campaigns. Cambridge Analytica has worked on the Ted Cruz 2016 campaign, the Ben Carson for President 2016 campaign, the John Bolton PAC, and most notably—the 2016 Trump for President campaign.

Cambridge Analytica was founded by Steve Bannon and Robert Mercer.

WHAT HAPPENED? WHAT IS THE SCANDAL?

The story that’s been all over the news recently revolves around data Cambridge Analytica collected from Facebook users, and then transferred to the Trump campaign. The scandal? Sharing this information is against Facebook's data policy.

The data in question was collected by Cambridge Analytica in 2014 when it created a personality quiz on a downloadable app for users to take. According to the NY Times, "The idea was to map personality traits based on what people had liked on Facebook, and then use that information to target audiences with digital ads."

Included in the data collected by Cambridge Analytica were details on user identities, their associated friend networks, and things that the users had liked. Passwords or other sensitive pieces of information were not collected, according to Facebook, except for the locations of users.

Facebook stated that this scraping of data was not a data breach—developed by Dr. Aleksandr Kogan, a psychology professor at Cambridge University, the app was permitted to collect this information for academic purposes. What Facebook didn’t know, however, was that Dr. Kogan had provided Cambridge Analytica with the user information, a violation of the social platform’s terms of service. The amount of data shared is estimated at over 50 million raw files. 

When Facebook discovered the violation in 2015, it removed Dr. Kogan's app from the site and required proof that the data provided had been destroyed.

Cambridge Analytica has since certified that it had destroyed the data, but Facebook is planning an audit to confirm the validity of this statement, hiring a digital forensics firm to investigate. Facebook has suspended Cambridge Analytica and Dr. Kogan from the social platform.

In the meantime, the Federal Trade Commission is looking into whether Facebook violated the 2011 consent agreement for user data privacy.

HOW FACEBOOK IS TAKING ACTION

Facebook is also acting quickly to reestablish trust among users by:

  • Giving priority to local news sources in the News Feed.
  • Launching its Community Boost education program, which gives users hands-on lessons on how small businesses can make best use of the platform.
  • Performing a full audit of any app showcasing suspicious activity. All developers found to have misused personally identifiable information will be banned from the platform. 
  • Reaffirming the safety of user data and turning off access for apps that haven’t been used within the last three months.
  • Restricting Facebook login data to include only name, profile photo, and email address.
  • Encouraging people to manage the apps they use via their settings.
  • Rewarding people who find vulnerabilities by expanding Facebook’s bug bounty program.
  • Removing the ability to use Partner Categories, which lets advertisers target third-party data segments directly on the platform. 
    • After May 10, 2018 advertisers will no longer be able to create a campaign using Partner Categories.
    • Some categories will stop delivering as soon as May 25, 2018, while all Partner Categories will no longer be available after October 1, 2018. 

HOW USERS ARE TAKING ACTION

How are users responding in the wake of the scandal? While one sample survey of 500 Facebook users reports that 19 percent will now use Facebook significantly less and 8 percent will stop using it altogether, eMarketer numbers suggest that Facebook user growth had already peaked well before this incident. Growth will still be seen on Facebook-owned Instagram, however, and more notably Snapchat, particularly among the younger demographic.

HOW ADVERTISERS ARE TAKING ACTION

While some brands have gone so far as to shut down their Facebook pages—such as Elon Musk closing the Tesla and SpaceX profiles and Playboy deactivating (not permanently deleting) its account—all signs indicate that advertisers are not pulling out of spending on the platform. There are brands that are momentarily "pausing" spend, and even others that are leveraging the scandal to do some positive brand-building, but from an engagement and advertising perspective, Facebook remains a powerhouse for brands to find the most relevant audience at scale.

As the investigation from Facebook's hired digital forensics firm progresses, it will be worth watching the public reaction to see if there is further attrition of advertisers. 

OUR PERSPECTIVE

Red Door Interactive strives to keep client partners and brands aware of what is happening across the digital landscape and the implications to strategies being deployed. In the case of the Cambridge Analytica and Facebook scandal, we recommend that brands:

  • Stay up to date on the digital forensics investigation, and how this impacts user sentiment about the platform and potentially the engagement and consumption rates of brand messages.
  • Review targeting in place on current advertising efforts on Facebook, staying aware of how it is being used.
  • Review performance metrics and effectiveness of Facebook advertising against brand objectives.
    • Metrics being tracked should go deeper than traditional "reach" (impression) or click numbers.
    • Test against other channels such as Snapchat to ensure that top performing channels are leveraged for each audience.
  • Update campaigns leveraging third-party data segments, or Partner Categories.
    • If there are any campaigns or tests that need to be completed before this feature is removed, they must be live before May 10, 2018, but keep in mind they will be completely turned off by October 1, 2018. 
    • We recommend using Facebook’s lookalike targeting and custom audiences as an alternative, as we do not expect this to have a large impact on performance. 
  • Keep a pulse on API availability and how third-party apps leverage user data.
    • Stay up to date on disclosure requirements for integrations with CRM tools and single sign-on.
    • Ensure any third-party apps being used are not using malicious practices. Investigate data collection policies or disclosures.


We can answer questions and help you determine whether Facebook advertising efforts are being used safely and transparently, and in a way that is relevant to the audience being targeted. Contact us today.
 

Insights,Social Media

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