Facebook's decisions to remove showing ads based on user data from “Partner Categories” could harm the company long term. The social network announced revenue and user figures for Europe last week. However, advertisers admit ongoing changes to the way the company secures ad data could be a problem.
Europe's new General Data Protection Regulation (GDPR) has been a concern for Facebook for some time. In January, the company published its planned privacy changes to comply with the new regulation.
Facing regulatory pressure and trying to manage the Cambridge Analytica scandal, Facebook announced it will shut down “Partner Categories”. This service allowed Facebook to gather ad data based on information procured by third-party data brokers. In other words, the company plans to stop third-parties from data mining its service and selling the user information.
That could be a problem for advertisers, who previously used the data to send targeted ads to users. Partner Categories have been removed from the UK, France, and Germany since late May. Facebook says the ad tool will be removed entirely from its global network by Oct. 1, 2018.
Advertisers will be left with just data gathered by Facebook or from their own research. Speaking to the Wall Street Journal, beer maker Heineken NV highlighted how the change could be an issue for large companies:
“It's going to have an impact for us because a good chunk of our spend uses non-Facebook targeting” which comes from third-parties, claims Ron Amram, global head of media for Heineken. The company says it gives Facebook more ad dollars than any other service. However, Amram admits he thinks Facebook will find a solution to the problem.
European Usage Figures
Last week as Facebook announced disappointing revenue figures that slashed the company's share price, it also detailed European usage figures.
Facebook says it saw it number of daily active users fall on the continent by 3 million. 279 million people use the network daily by the end of the second quarter of 2018.