What Happened? Everything You Need to Know About the Facebook Cambridge Analytica Data Scandal

What going on?

The New York Times and The Observer of London made waves on both sides of the Atlantic this month with reports that Cambridge Analytica, a political data firm, illegitimately accessed the profiles of 50 million Facebook users to influence political advertising during the 2016 presidential campaign. The reports claimed that Cambridge Analytica also influenced the 2016 Brexit vote.

Cambridge Analytica claimed to have tools that could identify the personalities of American voters and influence behavior. The firm used the data from Facebook profiles to develop the “techniques that underpinned its work on President Trump’s campaign in 2016,” according to the New York Times.

How did Cambridge manage to access Facebook profiles?

According to a report from The Guardian:

The data was collected through an app called “thisisyourdigitallife,” built by academic Aleksandr Kogan, separately from his work at Cambridge University. Through his company Global Science Research (GSR), in collaboration with Cambridge Analytica, hundreds of thousands of users were paid to take a personality test and agreed to have their data collected for academic use.

Cambridge Analytica was then able to access the data of the friends of the 270,000 users who took the personality test, yielding information from 50 million profiles. That data was then used to build psychographic profiles to inform political advertising campaigns. Facebook’s platform policy at the time only allowed apps to collect data from users’ friends to improve the user experience, they were not allowed to sell data or use it for advertising. The report said Cambridge Analytica obtained the data under the guise of academic research by Kogan.

What did Facebook do when they found out?

Facebook eventually became aware of the data leak and asked that it be deleted. But it was too late and Cambridge Analytica reportedly still has much of the user data.

In a recent Facebook post, Facebook CEO Mark Zuckerberg explained how the company responded when they first learned about the issue:

In 2015, we learned from journalists at The Guardian that Kogan had shared data from his app with Cambridge Analytica. It is against our policies for developers to share data without people’s consent, so we immediately banned Kogan’s app from our platform, and demanded that Kogan and Cambridge Analytica formally certify that they had deleted all improperly acquired data. They provided these certifications.

What is Facebook going to do about it?

Facebook is under a lot of pressure to provide more detail on a variety of questions: How did they allow this to happen? How much user data does Cambridge Analytica still have? How are they going to prevent third parties from further abusing their data? How are they going secure data going forward?

Beyond providing further information, Facebook needs to act. They need to implement the kind of changes to stop this from happening again and regain their users’ trust.

The company has taken a number of steps to address the issue. Facebook’s biggest move has been the removal of third-party data integrations with partners like Oracle, Experian and Acxiom that supplement Facebook’s data and allow for more precise ad targeting. Once the integrations are gone, advertisers will only be able to use Facebook’s data or their own customer lists. This means advertisers will no longer be able to tie in users’ offline behavior and social lifestyle traits (i.e., specific household income data, shopping intent, etc.).

Facebook has also paused their app review process, effectively blocking new apps from joining the platform. Here’s a snippet from a piece from The Verge on the move:

Facebook appears to be reevaluating how it approves apps due to how easily the third-party survey app, called “thisisyourdigitallife,” was able to mine data and sell it with little to no oversight from Facebook, and for Cambridge Analytica to retain that data even after claiming to the company that it had deleted it. “To maintain the trust people place in Facebook when they share information, we are making some updates to the way our platform works,” writes Ime Archibong, Facebook’s vice president of partnerships. “We know these changes are not easy, but we believe these updates will help mitigate any breach of trust with the broader developer ecosystem.”

Earlier this week, Facebook also announced a series of updates designed to give users more control over their privacy and the data they share on the platform. Facebook laid out the following updates in a blog post.

Controls that are easier to find and use

We’ve redesigned our entire settings menu on mobile devices from top to bottom to make things easier to find. Instead of having settings spread across nearly 20 different screens, they’re now accessible from a single place. We’ve also cleaned up outdated settings so it’s clear what information can and can’t be shared with apps.

New Privacy Shortcuts menu

People have also told us that information about privacy, security, and ads should be much easier to find. The new Privacy Shortcuts is a menu where you can control your data in just a few taps, with clearer explanations of how our controls work. The experience is now clearer, more visual, and easy-to-find. From here you can: make your account more secure, control your personal information, control the ads you see and manage who sees your posts and profile information.

Tools to find, download and delete your Facebook data

It’s one thing to have a policy explaining what data we collect and use, but it’s even more useful when people see and manage their own information. Some people want to delete things they’ve shared in the past, while others are just curious about the information Facebook has. So we’re introducing Access Your Information – a secure way for people to access and manage their information, such as posts, reactions, comments, and things you’ve searched for.

What ripple effects will this have?

It’ll be interesting to see how platforms like Google and Amazon capitalize on Facebook removing the third-party data integrations. My prediction: Amazon will capitalize on their knowledge of consumer behavior and shopping trends to heavily go after CPG brands. For their part, Google will rely heavier on their Oracle data integrations.

This could present a significant opportunity for Amazon at a time when the company has already been taking a larger slice of digital advertising revenue from Facebook and Google.

Share of U.S. digital ad revenue (% of total)

Share of U.S. digital ad revenue-Google Facebook Amazon and Snapchat

Source: eMarketer

Related – Sleeping Advertisers Wake to Amazon’s Giant Opportunities

Overall, I don’t think that Facebook will take an immediate hit from the move to drop third-party integrations specifically because most people probably didn’t know all this extra data was being pulled in. However, with the Cambridge Analytica fallout combined with less data for targeting, the second quarter of 2018 might not be the best investor reporting Mark Zuckerberg delivers.

The story does highlight the importance of protecting personal data. It’s a responsibility shared by everyone – users, platforms and advertisers. At Mindstream Media Group, we have strict processes in place to protect the data we get from our partners and our clients. The Facebook/Cambridge situation coupled with the pending implementation of the European Union’s new uniform data privacy laws only reinforces the importance of these processes.

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TL;DR Roundup [MARCH 2018] – The Facebook Data Controversy, Google’s E-commerce Move and Amazon’s Rising Value

Welcome to the TL;DR Roundup, Mindstream Media Group’s recap of the biggest stories in digital media, marketing and advertising. We know there’s too much going on to read everything, so we break down the most important stories for you. Continue reading “TL;DR Roundup [MARCH 2018] – The Facebook Data Controversy, Google’s E-commerce Move and Amazon’s Rising Value”

Sleeping Advertisers Wake to Amazon’s Giant Opportunities

Bleary-eyed advertisers who’ve hit the snooze button on the Amazon Advertising Platform (AAP) are waking to find it’s time to get caffeinated and catch up on overlooked opportunities.

The company that brings life’s wants and needs directly to 183 million consumers’ doors monthly knows more about their buying habits than Google or Facebook. While Google understands what users are looking for and Facebook knows (probably more than we want it to) about interests and likes, it’s Amazon that knows who is buying what, when and for how much.

Amazon Advertising Platform screenshotUsing predictive data from past purchases and real-time shopping insight, AAP serves up arguably the most relevant advertising at the time of decision. This puts advertising across Amazon’s owned-and-operated sites and apps at the bottom of the funnel.

CPG brands, like P&G and Unilever, have been among the first in line to include AAP in their brand and performance marketing strategies. Mega agencies Omnicom Group, Publicis and WPP plan to crank up their ad spend on Amazon between 40 and 100 percent this year, according to the Wall Street Journal. This will come, in part, at the expense of budgets previously tagged for Google and Facebook. So serious about AAP opportunities are ad agencies that WPP opened a Seattle office last year specifically to focus on Amazon, and it bought an Amazon consultancy for good measure.

Amazon advertising isn’t just an e-commerce play either. Brands without tangible products, like Progressive Insurance and Wells Fargo, are placing with the AAP. Other service categories, like moving companies, healthcare and travel, can make big inroads here, if they focus their brand strategy correctly.

Advertising on Amazon PrimeAdvertising options are plentiful across the sites, which include IMDb and Amazon Prime Video, as well as third-party exchanges. By 2022, Forbes reports that Amazon Prime Video subscriptions will reach 56 million domestically, providing solid audience numbers. While future advertising opportunities for Alexa on Echo have been under wraps, advertisers are taking advantage of ads on skills, like radio or podcasts.

Currently, options across Amazon sites include sponsored product ads, headline search ads, product display ads, out-stream and in-stream videos and sponsored content. Amazon is reportedly working with third-party mobile ad companies for video opportunities outside its own network. Offline opportunities are out there, too.

Targeting on AAP

According to Digiday, AAP targeting includes:

  • Behavioral (lifestyle, in-market)
  • Contextual (product category)
  • Lookalike (pixel-based, anonymous customer match, Amazon first-party data)
  • Remarketing (pixel-based, anonymous customer match)
  • Demographic/geographic

Interested in knowing more about Amazon strategies? Contact us.

How Multi-Location Brands Can Optimize Websites for Voice Search Results

When it comes to media adoption, consumers are a little like speedboats — adapting quickly to the changing currents, ready to go in a different direction and try new paths. Brands, on the other hand, can be more like tanker ships – changing directions slowly, hesitant to change faster than a few degrees at a time. This problem is often exacerbated for multi-location and franchise brands who need to relay changes in organizational direction to hundreds or thousands of decentralized locations.

But, multi-location brands currently have a golden opportunity to change this course. Voice-enabled speakers like Amazon’s Echo and the Google Home have been steadily increasing in popularity. These smart speakers are powered by intelligent, AI-driven software that responds to users’ voice commands and queries. Consumers often rely on these devices to provide essential information to connect with nearby businesses.

US voice-enabled speaker users

While the iron is still heating up, multi-location brands need to start thinking about how they’ll connect with smart speaker users. There’s a variety of ways to do this, from basic steps like making sure local listings are up-to-date and optimized, to advanced measures like developing smart speaker integrations (e.g., skills for Amazon Alexa).

This post was originally published on LSA Insider. Check out the full post to learn more about how multi-location brands can optimize their website for voice search.

Need help optimizing your website for voice search? Contact Mindstream Media Group to learn how our Content Marketing and SEO services can get your website ready to connect with consumers using voice search.

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Artificial Intelligence, Marketing and How They Work Together

One thing I learned while researching this article is that there’s a lot of information about Artificial Intelligence (AI) programs and machine learning out in the world right now, and hardly any of that information is detailed or consistent. Descriptions, check. Full disclosure, not so much.

There are reasons for this. Companies like Google, IBM and Facebook that have AI programs don’t want to give away trade secrets. These systems are expensive to create and maintain and are closely guarded because of that. Plus, the systems that teach themselves through machine learning are often unable to clearly explain their rationale for a particular choice. Those factors, combined with the sheer amount of data being processed, analyzed and converted into decisions make it so AI is complicated, awesome and not fully understood. But, we’re going to look at the few things we do know for sure.

What is AI?

According to Google:

“Artificial intelligence is the study of how to make machines intelligent or capable of solving problems as well as people can. At its core, machine learning is a new way of creating those problem-solving systems. For decades, programmers manually coded computer programs to provide outputs when given a certain input. With machine learning, we teach computers to learn without having to program them with a rigid set of rules. We do this by showing a system several examples until it eventually starts to learn from them.”

What this means for marketers and consumers is that AI is used to quickly accomplish highly complex analysis of consumer and sales data to increase sales, assist consumers and save time and money. AI and machine learning enable humans to take a step back and let the processors handle the analytical heavy lifting while we take care of other things.

AI is already used in many aspects of digital marketing

Programmatic buying is used extensively in Display, Social Media and Search marketing. This structure facilitates the process of buying ad inventory by analyzing cookie data and known targeted marketing information to allow marketers to make more informed decisions regarding who their target demographics are and what sites those audiences are likely visiting.

Beyond programmatic buying, IBM is using its AI program, Watson, to target audiences more efficiently, optimize online ad bidding, plan marketing efforts and even create ads themselves. “This automated technology has given clients up to 20 times ROI and lowered advertising cost per sale by up to 40 percent when compared with other solutions. It has also enabled more effective advanced KPI targeting including (testing), drive-to-store optimization and high-value customer targeting,” according to recent coverage by AdWeek.

AI makes talking to consumers easier

Chatbots have been the talk of marketing and e-commerce circles for a while now. They’ve grown in their ability to properly answer a variety of questions, and they save companies time and manpower. Much like search engine algorithm improvements, AI has made it possible for chatbot programs to better understand the nuances of human speech and become much more reliable in their ability to answer simple questions or direct consumers along their buying path.

While full adoption isn’t here yet, more than 40 percent of retail executives stated that AI either played a regular role in their customer service efforts or said they were beginning experimentation with the technology.

AI usage for customer service among U.S. retail executives

AI Usage for Customer Service Among U.S. Retail Executives

Source: Linc, “How AI Technology Will Transform Customer Engagement,” July 2017

AI helps consumers more than most people realize

If you think back to online shopping 10 years ago, the search bar on most e-commerce sites was basically useless. You needed either a near exact product description or an item number. Now, a customer can type in “men’s sandals” and sophisticated sites will pull back anything even close to men’s sandals. Misspell something in your search? AI is what helps the site understand you meant “RC car” and not “RV car” (try that on Amazon, it’ll correct it for you).

How AI is used on e-commerce sites

AI uses its knowledge base to find the context of our searches, even if we didn’t know we needed assistance. AI improves and expands that knowledge base anytime someone uses the e-commerce site. And, now it can even tell you after only a couple of purchases roughly how often you need to replace a product you buy somewhat regularly. Again, Amazon is what immediately comes to mind here, but many grocery store sites also have this feature due to the ability to track purchases through customer loyalty cards and the use of outside machine learning companies analyzing all that data.

AI platforms also allow retailers to analyze their sales patterns to govern price changes, fix stock-outs, determine the best timing and pricing for promotions and make strategic merchandising decisions that lead to more sales. Better and faster analysis is also fixing and preventing problems like “cherry picking” and cannibalization of other items and abandoned carts. In the long run, this reduces costs for consumers as retailers increase overall sales and are better able to stock and staff both online and brick and mortar stores.

A final word on AI

Overall, AI is still growing, is a bit secretive by nature and yet is already touching more aspects of daily life than most people probably realize. And, this is all just in the marketing field.

If you’d like to find out more about programmatic advertising or how to use data analysis to grow leads and improve your digital marketing campaigns, contact Mindstream Media Group for more information.