The Wall Street Journal reports: Gunning to win more advertising dollars, Facebook Inc. is using new ways to cull personal information from outside the social network and match it with data submitted by its billion-plus users.
The efforts are winning over advertisers such as General Motors Co. and Neiman Marcus Group Inc. but are further raising privacy concerns as Facebook harnesses a mosaic of information about its users.
On Wednesday, Facebook officially plans to roll out a new advertiser tool to help advertisers directly target Facebook users based on their offline spending history.
The tool marries what Facebook already knows about people’s friends and “likes” with vast troves of information from third-party data marketers such as Datalogix Inc., Acxiom Corp. and Alliance Data Systems Corp.’s Epsilon. That includes data on the Web pages that consumers visit, the email lists they have signed up for, and the way they are spending money online and offline.
A data broker like Datalogix, for example, aggregates information about which items and brands a consumer buys through sources like loyalty-card programs. Through software that obscures users’ identifying information such as email addresses and phone numbers, Datalogix and Facebook can combine their databases, and group users based on their offline purchases. Then, through the “partner categories” tool, brands can select which groups should see their advertisements.
For instance, a review of the “partner categories” tool by The Wall Street Journal found that categories often apply to tens of millions of people—for instance, there are some 20 million U.S. users who are heavy juice buyers on the social network.
A small chocolatier can target young parents in New York who buy lots of organic food products, for example. Hyundai Motor Co. recently ran a test to send ads to people identified as “intenders,” or those likely to buy a car soon based on their use of auto-research sites.
While Facebook doesn’t provide data on individuals to advertisers, it now can feed advertisers information on broad swaths of its members including their behavior outside of the social network. [Continue reading…]