What is Cambridge Analytica and why should you care?
Cambridge Analytica is a data analytics company which helps political campaigns hyper-target voters online. In mid-March, allegations that Cambridge Analytica acquired data on 50 million Facebook users without their consent appeared in The Guardian and The New York Times, causing Facebook to suspend Cambridge Analytica from buying ads or accessing Facebook data.
The news instantly pushed Facebook’s data practices into the limelight. In response to public concerns about protecting their personal information, Facebook announced it will stop using data from third-party providers and will limit how much data it makes available to advertisers buying hyper-targeted ads.
Third-party data companies offer purchase data – like brand preferences and shopping habits – to advertisers so they can target their brands to high-interest users and households. For instance, data from a loyalty card program at a grocery store could identify coffee drinkers from tea enthusiasts or even, those who buy Folgers every week from occasional Maxwell House shoppers.
Denying third-party data sources access to Facebook may initially limit some advertisers’ targeting options. For companies that do not track their own customer data, like small businesses or brick-and-mortar retailers, this third-party data has been a go-to resource for audience targeting. However, Facebook’s own data on users is as robust as many third-party providers, so we expect many marketers will simply shift their targeting to Facebook’s audience selection tools.