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POV: Facebook's Limited Data Use Feature

Insights / 07.30.2020

Red Door /

Earlier this month, in an effort to address California Consumer Privacy Act (CCPA) compliance, Facebook released a new Limited Data Use feature to give businesses the ability to manage how data is used within the Facebook platform.

What is Limited Data Use (LDU)?

Limited Data Use (LDU) is a parameter that allows brands and/or agencies to limit the use of data from users located in California. When LDU is enabled, a business may notice an impact on campaign performance and effectiveness, including limitations to retargeting and measurement capabilities.

As part of the rollout, Facebook has implemented a transition period starting July 1, 2020 and ending on July 31, 2020. During the transition period, LDU is enabled by default for users in California. For those that need more time to implement LDU, there is an option to extend the transition period and keep LDU on by default until October 20, 2020.

To update settings in Events Manager, go to the Data Sources tab, select your pixel, then select Settings and use the Transition Period Settings section.

How will Limited Data Use affect your business?

Media

According to Facebook, “When Limited Data Use is enabled, businesses may notice an impact on campaign performance and effectiveness, and retargeting and measurement capabilities will be limited.” Alll 1st party data with California based users will need to have any “opt out” users removed. Limited Data Use must be enabled for use of all 1st party data within Facebook regardless of opt in/out status. Ads will continue to be delivered to people in California, but campaigns that are optimizing for off Facebook conversions will see a performance impact depending on the total share of traffic.

It is important to note that LDU is only effective for users in California, as the feature aims to help businesses become CCPA compliant by limiting the use of California resident’s personal data. The exact consequences of this will vary based on the business and their implementation. Businesses may experience an impact on conversions being reported within Facebook, which will also impact ROAS.

As the feature is rolled out, Red Door will continue to monitor impacts to California based audiences and California-specific performance.

Configuration & Tag Implementation

As part of LDU, Facebook has provided new tagging options to tailor data capture and processing in alignment with your business needs. To enable these options, Facebook has introduced a new method for the standard Facebook pixel - dataProcessingOptions - which allows you to control how Facebook will use the data collected. This pixel must be installed prior to initiating your tracker. This new setting allows businesses to instruct Facebook when to enable/disable Limited Data Usage, and the preferred method to determine user location-geolocation or through the pixel.

It's important to note that to make use of user opt-out (CCPA) or opt-in (GDPR) selections, your business must have the required data usage notices and a mechanism for storing the selections per each user. These solutions range from custom, yet very simple, to comprehensive third-party consent-management platforms. Red Door has experience evaluating these platforms and deploying across complex tracking implementations.

Suggesting the best or 'recommended' settings for this new capability is beyond on the scope of this POV, and requires a personalized approach. For more information, contact us for support implementing the appropriate data capture settings for your business.

Expected impact

If no action is taken, Facebook will revert the status of LDU to disabled, which means they will process all user data.

If brands and/or agencies enable LDU for those California residents who have specified, “Do Not Sell My Information,” then Facebook will limit the use of that data in accordance to CCPA law.

It is important to note that California CCPA compliance went into effect on January 1, 2020, and enforcement is available to the California Attorney General’s office as of July 1, 2020, in the form of state fines. As Facebook’s transition period ends on July 31, 2020, brands should have a solution in place to address the Limited Data Use feature for customers who reside in California.

Our Perspective

Red Door recommends implementing the use of Facebook’s Limited Data Use flag for California users who have used the CCPA’s mandated “Do Not Sell My Information” feature on a brand’s website.

If you cannot implement the LDU flag per-user by the July 31, 2020 deadline, we recommend using Facebook’s configuration to turn on the Limited Data Use flag for all Californians until the per-user implementation is in place. This solution will impact Facebook media performance for all Californians.

Implementing the per-user Limited Data Use flag before July 31, 2020 or turning on Limited Data Use across the Facebook platform will keep your brand in compliance with CCPA.

Still not sure what to do? We’re here to help guide you through the Limited Data Use enablement process. Contact us today!

More Information/References

Data Analytics & Visualization,Insights,Marketing Technology,Paid Media