From eMarketer on The Advertising Opportunity in Facebook Places [excerpt]: Facebook’s value as a business comes from all the bits of information it gleans about its users from their daily activities. Every single action people take—whether it’s writing a status update, posting a photo, commenting on a friend’s post, liking a marketer’s message or playing a game—becomes an object in Facebook’s database. Location is a type of data that is very compelling because it provides additional context for the actions people take on Facebook…If ads can be pushed to people in the moment they are engaged with something, rather than waiting until they take action and start a search, the ads become very very powerful. Location will give Facebook a new way to target and sell advertising… By offering ways for marketers to target Facebook users not only on the online service but also when they are on the go and using Facebook on their mobile phones, it opens up all-new avenues for interaction.
Category: wireless
“Tipping Point for Geo-Marketing”—Facebook Places (and what the Like Button already tells marketers)
You have to follow your data [and your friends and networks]–that’s how the money is generated in online marketing. This article via DM News explains that:“…Facebook continues to gather more information about what people do and where they are – critical data for marketers. “What I find interesting is where people check in says even more about what they like. Now we’re actually looking at their real-world behavior, instead of just a button they click on a website,†he said [Augie Ray, senior analyst at Forrester Research]. “I think this really will continue to help Facebook offer much better targeting and permit marketers to do a better job of understanding their consumers and targeting ads at those consumers. The very scale that Facebook Places creates is a welcome event for marketers, said industry professionals. “I would say this is a tipping point for geo-marketing,†said Lawrence Kimmel, CEO of the Direct Marketing Association…Maria Mandel, VP of marketing and media innovation at AT&T Advanced Ad Solutions, agreed that the service makes geo-marketing much more mainstream. “It certainly brings location-based social media to the mass market,” she said. “It validates the relevance of the location-based check-ins and may offer substantial new opportunities for advertisers.â€Â Leveraging location may prompt innovative promotional campaigns, such as scavenger hunt contests, Mandel noted. There is also the scope to build long-term loyalty programs by rewarding people for checking in at certain locations to build toward prizes, offers or discounts, she said.
source: Marketers See Potential in Facebook Places. Shahnaz Mahmud. DMNews. August 20, 2010.
PS:Â One social media marketing company writes that:Â “…Facebook already provides marketers with a comprehensive list of your interests and favorite things with the integration of the Like button. Retailers, like Amazon, have already begun to leverage this information to create purchase suggestions for you and your Facebook friends…Now, with Facebook Places…[M]arketers can (and should) use this invaluable information to direct promotions and advertisements to consumers…This information is highly valuable as social media once again allows businesses to gain access to the exact niche of consumers they are striving to reach.”
Facebook Places, Brands, Ads & Data
We have been raising concerns about privacy and location data collection and targeting–including with our colleagues at USPIRG. Facebook’s new location feature is designed to generate more user data that can be used by Facebook and its affiliates to bolster ad and brand targeting. I want to excerpt this post from one of Facebook’s developers–Vitrue–which illustrates how soon companies like McDonald’s will work with Facebook to harvest local data and our behaviors:
“…A user will open up their mobile Facebook app and be able to see shops, restaurants, parks, areas, etc. that they are near. They can then check-in to that location. If a location doesn’t exist, the user can simply create it. A story about where that person checked-in will be published to their profile and subsequently their friends’ news feeds…Facebook’s massive user-base is a distinct advantage and is likely to generate location-based activity orders of magnitude greater than other companies already in the space. As the leading social network, Facebook is able to capitalize upon the users existing friends, and use their collected demographic and preference data to show users places that it thinks is relevant to them, instead of just places nearby.
How Will Brands Take Advantage of Facebook Places?
With all of these users checking in to locations, what does that mean for brands? Well if your brand has brick-and-mortar locations, your brand can claim these digital “Placesâ€, turning the locations into Facebook Place Pages.
Brands can choose to merge a Facebook Place Page with an existing Facebook Page, if one exists, and if prompted– the option may not be widely available yet as Facebook is rolling it out over a period of days…
At this time Facebook does not recommend merging your Places with your Page if you are a national or global marketer with more than one location, like a McDonald’s or GAP. They recommend managing the Places separately and have stated that a solution that will help these types of brands is planned for the future…Currently, Facebook CEO Mark Zuckerberg says they aren’t looking to monetize Facebook Places right now, but that doesn’t mean that they can’t in the future.  With Facebook collecting all of this location-based data, it seems like Facebook could allow brands to place highly targeted Facebook ads on the Places Facebook pages. For example, if your brand’s products are sold in grocery stores, you could potentially place your ads on certain grocery stores’ pages to be viewed by people who’ve checked in.”
In another words, in the world of mobile and location ad targeting, our data will provide marketers with real-time sophisticated insights giving them a rich history of where we spend time and what we do [go to the bank, buy at the pharmacy, eat fast food, etc]. Such “360 degree” targeting, as the online marketers call it, require the appropriate privacy safeguards.
Google: Creating a “dynasty” in online data ad targeting
From the Connected Marketing Week in SF, via ClickZ:Â Google is simultaneously attempting to fill the role of ad exchange, ad network, DSP (through its Invite Media acquisition), and media agency…Michael Rubenstein, president of AppNexus and the former head of Google’s ad exchange efforts, said Google has been admirably fair and transparent. But he said that could change.”Google is putting together the pieces to form a dynasty,” he said. “So far they’re behaving pretty well as far as keeping the ecosystem open to everybody, probably because they need to. But we’ll see what happens over time as they accumulate more market power.”
Google’s interest in better bandwidth access for video and interactive ads—do negotiations with Verizon reflect recent changes for YouTube?
Google recently made an announcement that will require likely greater bandwidth for Google’s YouTube. According to its July 9, 2010 post, “Today at the VidCon 2010 conference, we announced support for videos shot in 4K, meaning that now we support original video resolution from 360p all the way up to 4K…We’re excited about this latest step in the evolution of online video.” Also perhaps relevant to its Verizon dealmaking is Google’s move towards long-form ad supported videos on YouTube, to better position itself as a commercial video provider. If they want to ensure they are first in the `que’ with other entertainment companies, then reversing its position on network neutrality is part of their business plans. They are ultimately in the same show biz/advertising space as everyone else is.  Btw, given that the media/telecom companies really don’t see a difference when marketing and distributing across multiple platforms, inc, mobile, it’s outrageous mobile would be exempt from network neutrality rules. But perhaps blame it on Google’s Admob acquisition and its [and everyone else’s] plans for mobile location ad targeting!
Here’s an excerpt from today’s Ad Age article on Google’s new higher resolution and more bandwidth system for YouTube: “YouTube recently announced support for “4k video,” meaning video files with a dimensional size up to 4096 x 2304 pixels — in other words, much larger than your computer can handle. Online video is booming, and marketers are still trying to figure out how to create the optimal user experience and achieve the best results for their campaigns…YouTube mentions that watching videos in 4k requires an “ultra-fast high-speed broadband connection,” but this is actually the least-important requirement. While users on slower broadband connections can always wait for enough of the video to download and buffer before watching it (though why would a marketer force consumers to do that?)…
WSJ Begins Online Ad/Privacy Series. Plus Online Marketers Explain Behavioral Targeting, including role of social media for predicting people’s behavior “before they do it”
The Wall Street Journal launched an important new series on the online marketing and data collection/targeting industry. Julian Angwin and colleagues have the the first main piece entitled “The Web’s New Gold Mine: Your Secrets.” The subhead underscores what we have been telling policymakers and others for the last several years: “…one of the fastest-growing businesses on the Internet is the business spying on consumers.” The theme of the series: “Marketers are spying on Internet users – observing and remembering people’s clicks, and building and selling detailed dossiers of their activities and interests.”
They have done a terrific job, including producing a innovative video on how cookies work, including its history online. There are special graphics as well illustrating the data tracking process. They also discuss the growth of so-called predictive behavioral targeting, including the use of social media. The OpenAmplify CEO explains “Social media is an amazing opportunity. For the first time in marketing history we have hundreds of millions of people online telling us what they like, what they hate and what they’re going to do before they do it … That’s extremely valuable data.â€
Meanwhile, online marketers are preparing to place the forthcoming behavioral ad “icon” from the online ad industry– that’s supposed to help the industry politically head off consumer protection rules. Here’s how one legal expert working with online marketers, in discussing the icon, describes behavioral targeting:
“Behavioral ads use technology that tracks a user’s surfing behavior on the Internet. Key data includes clickstream data such as searches made, content read, site-visit times, and websites visited. With this key data about a specific user, advertisers can create a behavioral pattern that can be linked to a specific online demographic, which becomes the basis for ads that target the specific demographic…For example, a frequent traveler can be tracked to different locations through geographically different IP addresses, and then by combining this information with cookie data, an advertiser can draw a clear picture of the person’s travel habits – destinations, length of stay, travel frequency, preferred airlines – plus much more.”
I doubt the forthcoming digital data collection and targeting “icon” and its accompanying information will stand the truth test! How do you explain an entire “ecosystem” of data collection and profiling techniques, including social media marketing, neuromarketing, “immersive” video, online ad exchanges, etc. with a tiny digital [and appropriately named] ‘bug.”
Teens and Online Privacy: Empowering Adolescents to Control How Online Marketers Can Stealithily Target Them and Collect Data
Some commentators–and groups funded by online marketers that target teens–are worried that proposals to the FTC and Congress that adolescent privacy be protected will somehow create a system that requires forms of age verification online. The coalition of leading consumer, child advocacy, health and privacy organizations filing comments at the FTC last week aren’t calling for the parental permission paradigm used by the Children’s Online Privacy Protection Act [COPPA] be extended to teens. But there are many online commercial services specifically targeting adolescents–that’s their target market. It’s those sites and services specifically focused on adolescents that we want to have better privacy safeguards.  We want those sites to be governed by an opt-in regime that gives teen users meaningful control of how their information is collected and utilized. Those sites should be required to engage in the Fair Information Principles known as “data use minimization.” Commercial sites targeting adolescents should make its data collection practices fully transparent and under the control by the teen (including a truly accessible privacy policy). In another words, a privacy safeguard regime that really should be available for everyone. Teens are ‘ground zero’ for much of digital marketing–for examples see our site: www.digitalads.org [especially the update section]. If you look at the reports on that site, you will see that the most recent scholarly thinking is that brain development in adolescents occurs much later than what was once thought. They don’t have the ability to effectively understand the intent of highly sophisticated interactive marketing and the corresponding data collection which underlies contemporary digital advertising. That’s why empowering them so they can protect their privacy strengthens their rights.
Harvard’s Berkman Center, its online marketing industry connections, and the need to prominently disclose
The Berkman Center is well-known for its work on digital media issues. But it has often failed to address–in its research and public work–the negative consequences of online marketing and interactive advertising. Berkman is partially funded by leading online marketers–including Google and Microsoft. When Berkman conducts research on such issues as children’s online marketing and privacy [an issue I am involved with], it should always prominently disclose on the first publication page its funding conflicts–including whether Berkman staff work with online marketers. Berkman should tell Congress and the FTC about such conflicts when it submits research and testimony.
For example, Berkman’s faculty co-director John Palfrey works for a venture investing firm that financially backs behavioral targeting and other online marketing companies. Professor Palfrey does disclose on his blog that in addition to his Harvard duties, he is also a “Venture Executive” at Highland Capital Partners. Highland’s “Internet and Digital Team,” which Prof. Palfrey serves on, has one current investment in Affine Systems, a video targeting company. Affine’s Video Platform explains it enables marketers to engage in behavioral targeting: “Affine integrates behavioral data from exchanges and exclusive third-party partnerships. This data is used to audit and optimize campaigns as they run. Detailed analytics are collected, and valuable retargeting data is generated with every campaign.” [“What makes the Video Targeting Platform special is the amount of insight it provides…by taking advantage of the data provided by Affine’s data partners, you can even target specific demographic or psychographic groups, and reduce the waste that is currently expected from online video buys.”]. Highland also invests in search engine and interactive TV companies serving the China market and many others. [Given the investments in China’s online market by Mr. Palfrey’s company, it also raises questions about Berkman’s Global Network Initiative role evaluating how companies like Google and Yahoo operating in China and elsewhere address human rights]. Previous online marketing (and behavioral targeted related) investments made by Highland included the youth online targeting company Bolt, Coremetrics, and mobile ad targeting company Quattro.
The well-known online analyst and commentator Dana Boyd is a Fellow at Berkman, and has made it clear she also works for Microsoft Research. But given Microsoft Advertising global efforts to extend the power of online marketing and personalized data collection, including its online ad research lab in Beijing, its support for neuromarketing in digital ads, and its extensive behavioral and online targeting apparatus–including for junk food targeting youth in its gaming divisions, we hope Ms. Boyd will more closely examine her employers work in the area.
Online Ad Lobby and Chamber Celebrate Victory over Consumer Protection & FTC
Yesterday, the online ad lobby [IAB, ANA, DMA]–working with Chamber of Commerce–scored a major political victory by forcing the Financial reform bill conference committee to drop proposed provisions that would have strengthened the FTC. Under the House bill, the FTC would have been given the same kind of regulatory authority most federal agencies have [APA rulemaking]. Marketers and advertisers are celebrating their win, because it keeps the FTC on a weakened and short political leash. While consumer protection is significantly expanded because of the CFPB and new financial rules, the FTC is to remain largely hamstrung. The online marketing and advertising lobby [including ANA, DMA–see below] were afraid that the newly invigorated FTC under Pres. Obama would require the industry to protect privacy online and also become more accountable to consumers engaged in e-commerce.  I heard IAB and Chamber are dancing in the streets! Congressmen Barney Frank, Henry Waxman and Sen. Rockefeller deserve praise for working hard to protect consumers, including their proposal on the FTC.
Here’s what two of the ad groups placed on their sites about the FTC issue:
Progress on FTC Enforcement Provisions in Wall Street Reform Conference
June 23, 2010
The marketing and media community has made substantial progress on defeating the broad expansion of FTC powers that is included in the House version of the Wall Street reform bill. But we still need your assistance to keep these provisions out of the final bill.
Yesterday the Senate conferees presented an offer on the bill that rejected the new FTC powers that are in the House version. Chairman Dodd indicated that while he may support changes in the Magnuson Moss rulemaking process, there is no Senate provision and these issues are too complex and important to be resolved in the context of the Wall Street reform bill. Conferees hope to finish the conference this week so the final bill can be cleared for the President’s signature next month.
The House conferees may still continue to push for these provisions, so it is very important that marketers contact the Senate conferees to express our appreciation for their support and to urge them to remain strongly opposed to these new powers for the FTC in this bill. Contact information for the Senate conferees is located here and our letter to Senate conferees is available here. Please let the Senators know if you have plants or operations in their states.
ANA took part in a very important meeting yesterday with Senate Commerce Committee Chairman Jay Rockefeller on these issues. We argued that these issues are very important to the entire marketing community and deserve careful consideration outside of the context of the Wall Street reform bill. The Chairman strongly indicated that he will continue to push for changes in the Magnuson Moss rulemaking procedures this year.
If you have any questions about this matter, please contact Dan Jaffe (djaffe@ana.net) or Keith Scarborough (kscarborough@ana.net) in ANA’s Washington, DC office at (202) 296-1883.
http://www.ana.net/advocacy/content/2418
DMA Asks Financial Reform Conferees to Keep FTC Expansion Out of ‘Restoring American Financial Stability Act’
June 10, 2010 — The Direct Marketing Association (DMA) today was joined by 47 other trade associations and business coalitions in sending a letter to each of the conferees on H.R. 4173, the “Restoring American Financial Stability Act†(RAFSA), urging them to keep language that would dramatically expand the powers of the Federal Trade Commission (FTC) out of the final bill.
As the House and Senate conferees work to reconcile their versions of the financial regulatory legislation, the associations — which represent hundreds of thousands of US companies from a wide array of industry segments — expressed strong opposition to provisions in the House version of the bill that would expand the FTC’s rulemaking and enforcement authority over virtually every sector of the American economy.
“The balance struck in the Senate bill is the right one,†said Linda Woolley, DMA’s executive vice president, government affairs. “That bill makes the most sense in the context of financial reform legislation, maintaining the FTC’s existing jurisdiction without expanding its rulemaking and enforcement authority over industries and sectors that had nothing to do with the financial crisis. Issues of FTC expansion deserve their own due consideration and debate in the more appropriate context of an FTC reauthorization, as has been done in the past.â€
DMA and the other associations strongly believe that granting the FTC broad new authority is not a necessary or relevant response to the causes of the recent recession and, therefore, asked the conferees to oppose the inclusion of any provisions that would expand FTC authority, rather than making changes to the Commission that would have a fundamental impact on the entire business community and the broader American economy.
For more information please visit www.dmaaction.org.
http://www.the-dma.org/cgi/dispannouncements?article=1449
Facebook: Ads, Data, and Dollars–its revenue comes from targeting “on users’ real life data”
Facebook execs frequently claim they don’t share their users personal information with advertisers. They also always add that Facebook isn’t really that interested in advertising revenues. But that’s not correct, as the Facebook Quarterly Business Review: Q1 2010 reflects. Facebook, now cash positive, was said to earn somewhere between $600-700 million in revenues last year–up dramatically from the $150 million generated in 2007. The Quarterly estimates that Facebook should earn over $1 billion in 2010. How? “By growing multiple revenue sources, mostly around advertising,” it explains. Facebook is expected to earn some $350 million alone in 2010 from selling its ad services to big brands, with more growth expected. In the last year, Facebook has “invested heavily in expanding its brand advertising efforts by opening up offices in Paris, Madrid, Milan, Hamburg, Sydney, Stockholm, Toronto and Los Angeles.” The report says that Facebook will eventually earn some $20 billion a year, with a huge increase coming from big brand advertisers.
So-called performance advertising on Facebook [from social games, for example] is expected to bring in between $500-600 million this year. There will also be additional revenues from Facebook’s virtual currency [and soon from mobile and location based marketing as well].
Facebook’s users aren’t informed about the datamining that occurs on what they post and communicate, including to their social networks. We believe these systems require transparency and mechanisms of user control. And FTC and Congressional action.