In episode four of the Marketing on Tap podcast, we take a look at how the fallout from the Cambridge Analytica scandal has left an indelible mark on how social networks gather data about their users.
While Facebook may say it’s taken steps to ensure it’s going to do a lot better when it comes to its users, recent events would suggest otherwise, with the confirmation there’s already attempted meddling in this year’s U.S. mid-terms on the platform, and chief security officer Alex Stamos stepping down.
With this background, what does it mean for marketers who use data from social networks to identify specific audiences? And what knock-on effect does that have for other networks and data sets when it comes to consumer trust?
Settle back and enjoy this week’s topic, brought to you in the usual unscripted manner that you’ve come to expect when Sam and Danny take the mic.
If you prefer to listen on the go, the audio version of this week’s episode can be listened to below.
Introduction Welcome to Marketing on Tap, a weekly podcast in which marketing pros and authors Sam Fiorella and Danny Brown serve up the latest marketing hot topics, campaigns, and trends, all washed down with a great craft beer. Join in for the fun as they debate the pros and cons of the topic of the week while featuring popular or up and coming microbreweries. Topics include: influence marketing, brand campaign successes and misses, customer advocacy programs, and marketing challenges facing businesses and agencies. It’s the marketing podcast to listen to for CMOs, senior sales executives, and key decision makers at mid to enterprise level organizations. And, with their good natured bashing of each other, each episode promises to entertain and educate in equal measure. Welcome to Marketing on Tap.
Sam Fiorella: All right, welcome back to Marketing on Tap podcast and video. This is Sam Fiorella and my mate, Danny Brown. Today, we want to talk about data. This is something that has been really buzzing a lot in our industry, and actually across the news in general because of this whole Cambridge Analytica fiasco and the way that they handled our data or were grabbing our data.
Sam Fiorella: And so we want to talk a little bit about that today. Cheers, mate. We want to talk a little bit about that and what caught my attention, and the reason that I want to call this out, is a great article that I recently read in the American Marketing Association. I have the article pulled up here, called “The Murky Ethics of Data Gathering in a Post-Cambridge Analytica world.” And I thought it was really interesting. So, I just want to read you … Just to start the conversation, Danny, I guess the theme of what I want to talk about today, and that’s Cambridge Analytica was paid to acquire Facebook users’ personal information through an outside researcher who created data harvesting personality quiz.
Danny Brown: I see what you’re-
Sam Fiorella: Like what Soprano would you be? If you were a vegetable, what vegetable would you be? I’ve never done it, only because I thought it was ridiculous.
Danny Brown: Right.
Sam Fiorella: Now I’m glad that I didn’t do it. But anyway, the point is that what it was telling people that used it when they clicked, “Do you accept the terms and conditions?” which of course nobody ever reads, in the fine print it actually said that it was collecting the information for academic purposes, which is a crock, obviously. A claim that Facebook never verified as being true. Anyway, although only 305,000 people participated, and I think it’s every one of my friends did, so they were a big part of that 305,000 people, participated in the quiz. What it did is not only did it take your data, but then you agreed to have it scrape all of your-
Danny Brown: Your friends.
Sam Fiorella: Friends’ data. So of course our data got included with all the wankers that did it.
Danny Brown: Well, I think it said only about 100,000 maybe tops did it, but it actually impacted one, two, three million upwards.
Sam Fiorella: No. You want to know what the number is?
Danny Brown: I don’t want to know the number.
Sam Fiorella: 87 million.
Danny Brown: Crap.
Sam Fiorella: So 300,000 people actually did those quizzes, but it got the data from 87 million users because then it goes out and scrapes all this data. So anyways, so that’s what I want to talk about today and how do marketers deal with this? Because now with the whole GDPR, that’s become … we’re talking about that a lot internally and what’s the cost of that and how do we implement it? Do we implement it? So I want to break that down. But before we do that, almost equally important, what did you just pour?
Danny Brown: So today it’s a Cowbell. This is the Absent Landlord.
Sam Fiorella: Robert, where’s our bell?
Danny Brown: We need cowbell. Need more cowbell.
Sam Fiorella: That’s the second …
Danny Brown: To quote the great Anchorman, right? We need more cowbell, I think that’s [inaudible 00:03:48].
Sam Fiorella: I thought you were going to try and be all scholarly and quote Hemingway or something like that.
Danny Brown: No. It’s either Anchorman or just a British comedy or rock movie. I can never remember.
Sam Fiorella: Oh, I thought it was going to be Anchorman or Barney. Aren’t those your two staples?
Danny Brown: They were Barney and sometimes Caillou. Yeah, but Cowbell. A real good brewer up in Blyth, Ontario. They make, you’d like this, the Doc Perdue. It’s like [inaudible 00:04:10], which you should like.
Sam Fiorella: I do like [inaudible 00:04:12].
Danny Brown: And Doc Perdue makes, it’s a real nice ale as well. Not too harsh. It’s a good ale to drink. And also makes some real nice IPAs and a couple of other ones and other style stouts. But the Absent Landlord, it’s a craft beer, amber ale and it’s one of their flagship staples. Again, it’s not a really heavy one, it’s 5.3%, but of a 19 IBU. So the bitterness, the hoppiness is down there. And Cowbell, like I said, they’re making some really good beers and they’ve been open for a few years now. So, they’ve just actually come into [crosstalk 00:04:44].
Sam Fiorella: Got a little bit of experience behind them, right. Cheers, cheers.
Danny Brown: Yeah.
Sam Fiorella: A lot more full bodied compared to the wheat beer that we tried last week.
Danny Brown: Yeah, exactly. And it’s more full bodied but it’s not overpowering. That’s a good all year beer, I find. You can have that Fall, Summer.
Sam Fiorella: Well, for somebody like me that really does like a heavier beer or a darker beer, this is actually a good [inaudible 00:05:10], because I don’t like … well, that wheat beer that we had last time was really good. But this actually is really good. Yeah, I appreciate that. Anyway, once again, we’re not sponsored by Cowbell. It caught my attention because of it’s pretty packaging, so good choice.
Danny Brown: Yeah, exactly.
Sam Fiorella: I made that. It’s like when I bet on horses.
Danny Brown: You go for the best looking horse?
Sam Fiorella: It’s like, what’s the name? What’s the … Not the best. Well, I do have an affinity for good looking horses, I’ll have to tell you that. But I do pick it by the name. But that’s what got my attention on this one. But good choice. Anyways, we’re not sponsored by Cowbell, but we do encourage you to check it out. Typically, these are just what we like and this is definitely one of them.
Sam Fiorella: Okay, so let’s get back into it. So just to set the … For those of you that don’t know, I think it’s important to talk about how Facebook gathers information. For people that don’t realize, there’s traditionally three ways that they gather data. It could include the … As a marketer, we can go into Facebook and we can look at the users habits based on how they use the platform. Their web browsing history, their cellular locations. That’s the kind of information that we gather when we look at user data on Facebook. They make this available for sale.
Sam Fiorella: Or, we can get data through advertising as collected. So other advertisers that collect data, they can then sell that data. So that’s something that we have access to, and that includes email addresses, what stores they visited, so what else advertisers will give us. And then of course, there’s data provided by third parties. And I think this is where it starts to get a little bit tricky, especially in this particular Cambridge Analytica example.
Sam Fiorella: Here, these are really data brokers and they include companies like Acxiom, Oracle, Epsilon, Experian. I’ve actually purchased data from these companies in the past. So these companies basically build profiles of everybody. And what they do is they take a look at government reports, government records that are freely available. They will gather then, anytime you enter a contest and you enter your information, you know those contest companies are selling all of that data. So they’ll collect that. Surveys, data that they get from loyalty cards because that, by the way, if nobody’s aware that’s all being sold.
Sam Fiorella: And so these companies basically grab this data and make and merge it, and create a profile. And then when you take that data and add it to what you’re getting from Facebook, you know what I mean?
Danny Brown: Yeah.
Sam Fiorella: They’ve got quite a bit of data.
Danny Brown: Excuse me.
Sam Fiorella: So, the idea here is, the question that I want to pose is a question that this article in the American Marketing Association Journals posted is. Data collection rules are murky, and customers are completely creeped out, right? Which is their words. So my question is, can marketers actually lead the change? Facebook, despite what they’re saying, is really not leading it. They’re saying they are. I have zero faith. I think few people do. But, do we have an opportunity to take the lead here and clean up this industry?
Danny Brown: No, for sure. We can choose who we deal with, and that’s where our marketing dollars go, our clients’ advertising dollars. So we choose which vendor we want to work with and it’s a long process but if enough agencies push back and enough businesses push back, and the guys that you look at how they collect, what they collect, etc and you just don’t work with them. You work with the trusted ones. Then we can start to impact. We can also make sure that if a client asks us, “I want this kind of data.” Well, no, you don’t want that data.
Danny Brown: So there are things that we can do to actually impact it one step at a time to actually get it where it needs to be, for sure.
Sam Fiorella: It’s funny, because while we say that, we’re still using Facebook and we’re still collecting data on Facebook. So I guess it’s one thing to say it, it’s another thing to do it. Some of the stats that I’ve read recently, that Facebook reported 11.8 billion in advertising revenue after this whole Cambridge-
Danny Brown: Cambridge.
Sam Fiorella: Analytica. So, they’ve actually increased, so people like you and I, and we have to admit, we are still using Facebook-
Danny Brown: No, no. For sure.
Sam Fiorella: To advertise for our clients. It’s a 50% increase since the same period last year. That’s a significant increase. So marketers are definitely not taking the lead. We can, but we’re not. The other thing is, on the marketing side, Facebook remains still a good deal for us, right?
Danny Brown: Yeah.
Sam Fiorella: Which is the reason we do it, because it works for our clients ultimately. So the cost per thousand impressions on Facebook right now is running about $5.12, compared to LinkedIn which is 16.99, Instagram is 4.2 so $4.20, Pinterest is $3.20. So we’re still getting pretty good cost per thousand impressions. But more importantly, Facebook, I’ve found with the work that we’re doing, yields the highest click through rates at 1%. No one else is getting that. Snapchat is only .37, Pinterest is only .48, and LinkedIn only .25.
Sam Fiorella: So it’s a better deal for our clients. And funny enough, there’s this weird co-dependent relationship happening. So people know-
Danny Brown: Yeah, and they don’t care.
Sam Fiorella: They read it, and they don’t care. So they know that the data is not being used and very few people, I think the only exodus they saw was kids under 25, which were probably leaving anyway, right?
Danny Brown: Right. Exactly.
Sam Fiorella: But on 25 and over, we’re actually using it more. So I don’t know. Can we actually trust Facebook with our data? I know we’re marketers and this is all about Marketing on Tap, but let’s take a side. As an individual using Facebook, can we trust them?
Danny Brown: No, I don’t think so. And obviously we do say that as a marketers point of view as a consumer. But I deleted my Facebook account three years ago. I rejoined it and I locked it down as best I could, limited to friends, etc, but I still know that if I want to download an app to my phone, because I’m tied to Facebook of an app there, each app can speak to each other. And the data that I allow from app X can still be gathered by Facebook because they know I’m using app Y.
Danny Brown: And you go back to the whole election, whether it’s Ontario, the U.S., or whatever. The amount of fake news that jumped up and the amount of trolls that jumped up, and bots that were there, that Facebook aren’t really doing enough to get rid of. So, as they’re not doing enough to get rid of that, they really don’t care about the user experience which all ties back to privacy, and data, and knowledge about the user. It makes too much money. You just shared, they jump 50% in revenue, so why would they change and break that system?
Sam Fiorella: Well, it’s funny, there’s a co-dependency. And this gets back to that co-dependency thing. I was just looking for this quote that the article put out. “Facebook needs advertising to sustain its business.”
Danny Brown: Right.
Sam Fiorella: That’s obvious. “Advertisers need Facebook users to sell their products. And Facebook users need a platform to remember their Aunt’s birthday.”
Danny Brown: Right, that is exact. That’s it.
Sam Fiorella: Which is kind of creepy because I’m trying to stay away from Facebook for mental health reasons, but to be honest with you, I check it every day. So whose birthday is it today? Is it my wife’s birthday? Is it my mom’s birthday? You know what I mean? So it’s kind of funny, but it’s really weird this co-dependency that this application has.
Sam Fiorella: But getting back to marketing, one of the things that I want to caution is that there’s been a lot of question around the measurements and the accuracy of the reporting that Facebook puts out there. So, one of the things that I realized in just some of the studies that I’ve been doing when I first read this, is that there’s actually been admission by Facebook and some personnel at Facebook. Here it says that, “Including miscalculations of average watch time of videos, organic reach of posts, video ad completion rates, average time spent on instant articles, and referral traffic from Facebook to website and [inaudible 00:13:08] labs.”
Sam Fiorella: So we now have to really look at not just how is our data protected and what kind of data and are we going to be careful about the data we collect, but when we’re reporting measurements. This is something that goes back to the quality of measurements and what’s the actual ROI?
Danny Brown: Yeah, exactly. Well, the good thing is, I mean obviously that’s just one aspect of measurement. You have Google Analytics, you have other measurement tools that you can tie with Google AdWords. If you’re doing remarketing from Facebook based on website visitors, you can get all that information and tie their stats to our stats and get a nice mix in the middle. So we can keep an eye on it, we can make sure that we’re reporting correctly and as marketers we’re doing our job. But yeah, it’s like anything, you can’t just take the aspect that that report is going to be 100% correct. You have to tie it together to different data points.
Danny Brown: But yeah, I mean, from an advertiser point of view and a marketer point of view, again, why should we spend our money if the report is not what we’re paying for?
Sam Fiorella: You know what, because it’s really any different than what Instagram, which is also owned by Facebook-
Danny Brown: Yeah, [crosstalk 00:14:13].
Sam Fiorella: Pinterest or any of the … I mean, are they all any better? This is where, it’s really, we’ve been seeing this for 15 years now. This is still very much the Wild West. There’s just so much unknown and we’re just being so trusting that everything they tell us is accurate. We have to look at that.
Sam Fiorella: So the question then is, that I want to put up there, two questions before our time runs out here. Is personalization going too far? Is the one question that I want to talk about. And the other thing is, what’s the opportunity for marketers? Knowing that this is all kind of murky and that people are creeped out. How do we set ourselves apart? Should we now be saying, “Well, listen. We’re collecting your data by participating in this contest.” Is that going to go too far? Are people going to be turned off if we’re giving them too much information? Are they happy being blissfully ignorant?
Danny Brown: Yeah, well I think personalization, it’s down to the individual. And I know it’s easy as marketers to say, “Well, you own your information or what you share with us.” And well, you don’t know because you download an app and nobody goes through the terms and conditions and there’s so many permissions that are given to various apps. Which again, if you think Facebook’s bad, just look at your Android phone or your Apple phone and see what they’re actually tracking on you without you knowing.
Danny Brown: So I think personalization, when done well, it’s there for a reason. But consumers don’t really necessarily know about it. From an actual market point of view … Sorry, what was the second question? I got distracted by the last bell coming in.
Sam Fiorella: I know, yeah, because we have a … Well, we’re very high tech over here. Instead of having a last call bell, we have Robert standing over there doing one of these-
Danny Brown: Invisible last bell.
Sam Fiorella: Waving his hand.
Sam Fiorella: I know, but the thing is, have we gone too far?
Danny Brown: Are we [inaudible 00:15:57]?
Sam Fiorella: Are people just too creeped out? We have a lot of information. The idea of this information is to provide you a better user experience, but given what people know, are marketers now at risk of being too personalized in their messages? Is it going to backfire on us?
Danny Brown: I think we can make a mix of simple and complicated. So simple is for the end user, and you can get all the information you want to get across to them that impacts their use of an app or a platform in easy to understand language which is still showing that we’re going to take some information from you and this is the information. But, it’s no different than you using your bank’s credit card to buy something from Amazon, for example. Language like that, like comparisons. But you still have to, from a marketing point of view, when you’re talking to clients you have to make sure they understand this is what we’re tracking, this is what you’ve requested us to track, this is the recommendation to not to and if you do, this is what the potential outcome could be if it backfires. You know?
Sam Fiorella: Sure. Yeah, exactly. All right. So before Robert blows a gasket over there, last call. Final thought. Actionable item. What can we share with people?
Danny Brown: I think be better, and that’s for everybody. I mean, we’re talking to marketers and execs-
Sam Fiorella: So, Facebook. Zuckerberg, you listening?
Danny Brown: Yeah, I know you’re watching so, yeah.
Sam Fiorella: Him and Trump, sitting next to each other watching this, for sure.
Danny Brown: Yeah, Trump’s going to tweet out, [crosstalk 00:17:18]. Blasting us. But yeah, just be better. Be better marketers when it comes to what we’re asking and what we’re actually trying to get, and make sure the reasons for getting it are actual good reasons as opposed to the fact that we can get it and we can sell it on or whatever. And from an end user, just be educated. And when you see these stories, read them and take note of what’s happening.
Sam Fiorella: Right. Well, from my perspective, last call is going to be really data protection regulation, so GDPR. One of the fears I had about talking about this today is we need like an hour or more to talk about this. And we didn’t even really get into GDPR. But the one thing that I do want to call out as my last thought is, pay attention to what’s happening in Europe. The new regulations that out there that are affecting us because we market our companies that hire us are marketing to people in Europe, and so we have to be looking at this. So pay attention to the GDPR. We don’t have time on this conversation. Maybe that’s-
Danny Brown: No, we’ll revisit that for sure.
Sam Fiorella: We’ll revisit that. But if you don’t know GDPR, excuse me, go and check it out. This is something that we need to be much stronger as brand marketers. Whenever we engage with customers, we have to tell them, “This is why we’re collecting your data. This is how we’re going to use your data.” And not make it this 30 page legalese. Let’s simplify it, which again is one of the requirements of this GDPR regulation in Europe that’s going to eventually make it’s way here at some point or another. Be a leader. Take on those. It’s going to be costly, but take on those rules. Deploy them now. Your brand will be better for it I think in terms of public opinion.
Sam Fiorella: Anyway, that’s it. I want to get back to this beer and turn the recording off so Robert stops waving at me to cut it off. Thanks everybody. Cheers again, mate.
Danny Brown: Sure, man.
Sam Fiorella: I really appreciate the conversation.
Danny Brown: Cheers.
Sam Fiorella: Join us again next week for another Marketing on Tap podcast and video. Bye, everybody.
Danny Brown: [inaudible 00:19:13].
Outro: You’ve been listening to Marketing on Tap with Sam Fiorella and Danny Brown. If you enjoyed this episode, make sure to subscribe so you don’t miss the next one. And please, feel free to leave a show review. That’s always worth a cheers.