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What Marketers Need To Know About The End Of Facebook’s ‘Partner Categories’

Facebook announced in March it would discontinue Partner Categories, a program that supplemented its first-party data with offline and other third-party data to refine ad targeting, by phasing it out over a six-month period. That discontinuation is nearly complete: Campaigns can no longer be scheduled as of Aug. 15, and existing campaigns won’t deliver after Oct. 1. So, what’s it all mean for the ambitious social marketer?

The capability for advertisers to target on Facebook isn’t what’s being discontinued, but rather, Facebook is essentially absolving itself of the responsibility to do the grunt work with third-parties. Ryan Rolf, VP, Lotame, said that this change may force marketers to have deeper conversations about data — which isn’t necessarily a bad thing in the long term.

“It may be more work [for marketers],” Rolf said, adding, “Maybe it does in some ways, you know, now force them to develop the skills and vet the partners themselves and really kind of do their homework to make sure they are comfortable with the partners they’re working with.” 

The Partner Categories program, launched in 2013, effectively enhanced Facebook’s already huge pool of data by combining it with outsourced data not in Facebook’s purview — from advertisers and both digital and offline data brokers. In the beginning, Rolf said, Facebook’s interest appeared to be almost exclusively in data brokers who had offline data that Facebook did not.

Why the change? It came on the heels of a looming GDPR compliance deadline in the U.K. and the damage control efforts surrounding the Cambridge Analytica scandal in the spring of 2018 — both of which brought the data privacy and attribution conversation to center stage.

DMN contributor Pierre DeBois put Facebook’s unprecedented conundrum in context in April:

Reduced storage costs, the increasing range of data types, increased activity, and the access provided by APIs, have made data inexpensive and relatively easy to obtain and onboard. While that can be valuable, marketers can also be baited into collecting more data than actually needed. Facebook, through its decision to limit developer access, is beginning to understand the ramifications of collecting and holding too much data. Over-collection only increases marketers’ and brands’ exposure when it comes to a data breach.

In a saturated data market, and with the intimidating prospect of violating GDPR regulations, Rolf said, it can be a daunting minefield for marketers to navigate. Indeed, though, marketers need to be paying attention. For businesses that didn’t have access to troves of their customer data, the Partner Categories was a nice option. Although Facebook’s first-party data is undeniably top notch, Rolf said that there is still value in that offline information for businesses’ targeting needs that Facebook cannot itself provide.

“What they’re kind of doing is putting the onus on the marketer to essentially, you know, BYOD — bring your own data,” Rolf said. “Instead of hosting and making this data available to you in our platform in an easy way. Now, Marketer X, if you want to use those companies … you’re going to have to bring that data into the platform yourself through the Custom Audiences option.”

Custom Audiences uses customer lists uploaded by businesses to target ads to the intended customers (they can be deployed through Facebook, Instagram, and Audience Network). Businesses upload, copy and paste, or import a hashed customer list, and then Facebook uses the hashed data to match the people on the list to users on Facebook.

Rolf, a self-proclaimed optimist about the situation, said this could be a boon for demand-side platforms (DSPs), who might be able to close the “third-party data gap.”

“I’m hopeful that that means that other DSPs can see this as an opportunity to then, you know, really strengthen the partnership with these data companies and say, ‘OK, great. This gives us an option now to differentiate and have a very clear difference between what Facebook’s doing and what we’re doing,’” he explained. 

As the Oct. 1 cutoff approaches, it’ll be interesting to see how the dust begins to settle, but a lot remains to be seen. The move is permanent, Facebook said, and is about improving “people’s privacy on Facebook.” How marketers choose to approach the situation could shape best data practices for years to come.

“It is a crowded marketplace,” Rolf said. “It can seem overwhelming and sort of ubiquitous … but really, it comes down to what you do with the data … how you use it really kind of becomes one of the fundamental ways you differentiate yourself in the landscape.”

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