Facebook supports mass consumption

America has become the nation of mass consumption. There are few places other than open nature where you are not tempted to buy and consume. Technology has only increased this problem with seemingly necessary applications sold to make our lives easier. I talk to people who are doing everything they can to stay away and remain immune to this, however, it’s getting more difficult to separate ourselves they say.

In late February 2013, Facebook announced partnerships with four companies that collect lucrative behavioral data, from store loyalty card transactions and customer e-mail lists to divorce and Web browsing records. Public records are a vast treasure trove of information that is analyzed to target you for purchases.

They include Acxiom, which aggregates data from a variety of sources, including financial services companies, court records and federal government documents; Datalogix, which claims to have a database on the spending habits of more than 100 million Americans in categories like fine jewelry, cough medicine and college tuition; and Epsilon, which also collects transaction data from retailers.

Acxiom and Datalogix are among nine companies that the Federal Trade Commission is investigating to see how they collect and use consumer data.

Facebook’s fourth partner is BlueKai, based in Cupertino, Calif., which creates tracking cookies for brands to monitor customers who visit their Web sites. That data can be used to show an advertisement when those users log on to Facebook.  “Our goal is to improve the relevance of ads people see on Facebook and the efficacy of marketing campaigns,” Gokul Rajaram, product director for ads at Facebook, said in a recent interview.

In announcing the partnerships, Facebook said it would allow, for example, a carmaker to customize an advertisement to users interested in a new car. The push to refine targeted advertising reflects the company’s need to increase its revenue. Its shares are worth far less than its ambitious initial public offering price of $38 a share last May, and Wall Street wants to see it take concrete steps to prove to advertisers that it can show the right promotions to the right users and turn them into customers.

The partnerships are part of a continuum of efforts by Facebook to hone targeted advertising. Last fall, it invited potential advertisers to provide the e-mail addresses of their customers; Facebook then found those customers among its users and showed them ads on behalf of the brands.

Invited to share email address! Seriously?

JackThreads, a members-only online men’s retailer, tried this tactic recently. Of the two million customer e-mails it had on file, Facebook found more than two-thirds of them on the social network, aided in part by the fact that JackThreads allows members to sign in using Facebook login credentials. Facebook then showed those customers ads for the items they had once eyed on the JackThreads site. The nudge seemed to get people to open up their pocketbooks. Sales increased 26 percent at JackThreads, according to AdParlor, an agency that buys the company’s advertisements on Facebook.

Money in hand

Targeted advertising bears important implications for consumers. It could mean seeing advertisements based not just on what they “like” on Facebook, but on what they eat for breakfast, whether they buy khakis or jeans and whether they are more likely to give their wives roses or tulips on their wedding anniversary. It means that even things people don’t reveal on Facebook may be discovered from their online and offline proclivities.

Facebook says that in devising targeted ads, no identifying information about users is shared with advertisers. REALLY? Seems to me that what we just read suggests that everything they do is open to be exploited! E-mail addresses and Facebook user names are encrypted and then matched. Users can opt out of seeing specific brand advertisements on their page, but we all know those settings change frequently without notice. In order to completely opt out of receiving any targeted messages you must visiting each third-party data partner’s Web site which in and of itself is a very daunting task.

Bottom line, as you consume in America, you will tempted to increase your consumption which keeps retailers happy. Anything you post or provide to any application, will be shared whether you like it, give consent or not.

John Callahan is committed to teaching people how to mitigate debt and minimize unnecessary purchases. He also teaches people how to control the sale when purchasing high ticket items.

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