Facebook Advertising Isn’t Dead, and Here’s Why
You may have heard rumblings that Facebook is over, everyone’s leaving and advertising on the social media site won’t be worth the money you spend. But contrary to everyone’s panic, especially if you look at Facebook’s history, it likely isn’t going anywhere anytime soon.
(And no, Mark Zuckerberg isn’t paying us to write this...though we wouldn’t say no if he wants to pass us a few billion dollars.)
Why Some Users are Upset
Earlier this year, London-based company Cambridge Analytica was caught talking about swaying elections by advertising using misinformation. One of the ways they allegedly attempted to influence political outcomes was by advertising this misinformation on Facebook.
According to an insider, the demographic information of some Facebook users was legally gathered via a mobile app (lead by Aleksandr Kogan) where users would take psychological tests. But the app also gathered demographic info on millions friends of those users without their knowledge.
The info was then shared with Cambridge Analytica, who allegedly used it to direct deceiving ads to specific users about elections in the US and England.
Now some users are upset that (a) their demographic info was used in a malicious way, and (b) their demographic info was gathered (by Kogan’s app) without their permission.
Many others are likely upset as a result of poor terminology. When a headline says, “User’s Data Stolen from Facebook,” some people think that “data” means passwords, social security numbers and their deepest, darkest secrets. In reality, that “data” was only demographic information (which users willingly upload to the site).
While a lot of the blame lies with Kogan’s app and Cambridge Analytica, some users blame Facebook for not catching this right away. Facebook, however, did ban the phone app back in 2015 and ordered Kogan and Cambridge to destroy all users’ data.
Not Everyone is Mad
While you’re probably hearing war chants and seeing hashtags about everyone deleting Facebook, what you don’t see are the masses of users who are indifferent to the situation and are keeping their Facebook accounts.
There are millions of users who aren't as upset at the situation and also don’t mind being advertised to on Facebook. Many even say that targeted ads on Facebook help them make significant purchasing decisions.
Seen Facebook’s stock lately? If you read headlines and see March’s fluctuations, you’d think Facebook is over, too.
But before you jump to conclusions, take a look at the company’s performance over the past five years:
The company has been growing every year since it’s launch, and as of April 2018, they’re still worth more than they were at this time in 2017.
This also isn’t the first stock scare they’ve had. Back in April 2014, after Facebook bought several companies with “virtually no revenue and no profits,” the company’s stock price took a small dip but bounced right back.
In November of 2016, after Russia was caught using Facebook ads in an attempt to sway the Clinton-Trump election, their stock took another hit. But a few months later, their prices were higher than ever.
Reasons Why Facebook Will Survive
There are a few reasons why Facebook will likely endure this recent uproar:
It’s ingrained in our lives. Not only does a quarter of the world go on Facebook every month, but the site is used for things like app signups and keeping up-to-date with companies and news.
We have short attention spans. Remember #Kony2012? How about the BP oil spill or deflategate? We tend to have some pretty short attention spans, so most scandals are forgotten after a month or two.
Facebook is a useful site. Like it or not, Facebook’s interface and UX makes it a great place for communicating, event planning and sharing photos and ideas.
Here's the quick version of what happened:
1. When people use Facebook, they add their location, interests and opinions to their profiles. In return for using the site for free, Facebook allows marketers to advertise to users using this demographic information (not private info like names and passwords).
2. An app company deceivingly gathered some of this demographic info (but not private info like names and passwords), then gave it to Cambridge Analytica, who used it for spreading misinformation during elections in order to sway politics.
3. Some users are upset and are deleting their Facebook accounts, but many are staying on the site, which continues to make it a good place to spend ad dollars and measure results.
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