Marketing Lessons from the Facebook Debacle: Privacy vs. Personalization

Companies’ ability to collect and use customer and prospect data to create targeted marketing campaigns has grown exponentially over the past 10 years. The laws, internal policies and morality that control how this data is used have, unfortunately, failed to keep up. This disconnect came to a head over the past few weeks thanks to revelations of Facebook’s questionable data privacy practices late last month.

If you’re not familiar with the scandal, allow me to summarize: Facebook failed to prevent extensive Facebook user data from being collected via a third-party app. That data was then shared and used by political market research company Cambridge Analytica to create psychographic profiles of Facebook users that were used to serve them targeted advertisements in favor of a Trump presidency.

Blowback from these revelations has been severe: 45 percent of Facebook users say they plan to use the platform less, with 75 percent describing themselves as either very concerned (43%) or somewhat concerned (31%) about the breach, according to a report from Marketing Dive. As a result, Facebook stocks have taken a serious hit, down nearly 10 percent according to CNN Money.

Smart companies can learn from Facebook’s missteps, transforming the social media giant’s loss into their own gain. Many of us are already using customer or prospect data to send emails, serve ads or otherwise personalize marketing campaigns, and the ethics of these practices are worth exploring.

Could your marketing program withstand the kind of intense scrutiny that Facebook has been subjected to? Consider whether you might be guilty of any of Facebook’s various missteps:

They failed to take responsibility.

Facebook’s lax data privacy policies and nearly nonexistent enforcement relinquished their power to advertisers, leaving users with no protection. Even though the manner by which Cambridge collected, shared and used this data was the most concerning to most people, they escaped much of the blame. Instead that blame has fallen to Facebook for allowing Cambridge to access that data in the first place. Because Facebook had the most power to protect the data, they also had the most responsibility to do so.

They failed to obtain consent.

You could perhaps argue that the people who installed the “This is Your Digital Life” app consented, by default, to the collection of their data. But their Facebook friends – whose data was also mined and, in fact, that’s where most of the data came from – did not give their consent. It’s also clear that no one consented to their data being shared with a third party (a practice that, while prohibited by Facebook’s policy, was not enforced).

They weren’t transparent.

The Cambridge app was designed to look like nothing more than a fun personality quiz, designed for users’ own entertainment; they weren’t told their data would be used to send them targeted advertisements. In my experience, non-marketers are blissfully unaware of just how common these kinds of practices are. Facebook has since announced plans to add disclaimers to advertisements, but this seems like too little action too late. Which brings me to their next mistake:

They were too slow to respond.

According to The Verge, Facebook founder Mark Zuckerberg waited five days after the news broke about the scandal before responding publicly. That may not seem like much, but by then, public interest in the issue had already peaked according to Google Trends. The #deleteFacebook hashtag was already gaining major traction and prominent companies and individuals were deleting their pages. In the absence of information from Facebook itself, anti-Facebook sentiment filled the void.

It’s still unclear whether any of the missteps above will place Facebook into any definite legal trouble. But that’s really not the issue here. As more marketers jump onto the big data and personalization bandwagons, the adoption of ethical and transparent data use practices will become paramount, acting as marketers’ best defense against public backlash.

As the holders of our customers’ and prospects’ data, it is our responsibility to explore these issues. We don’t need to have all the answers right away, but we do need to ask ourselves some tough questions. Starting with: “How would my customers react if our data privacy and marketing practices became public knowledge?”