Facebook’s Ad Network Challenge To Google Coming Next Week

Facebook’s Ad Network Challenge To Google Coming Next Week

Based on the company’s Atlas acquisition from Microsoft, “it promises to help marketers understand which Facebook users have seen, interacted with or acted upon ads that appear both on Facebook’s services and on third-party websites and apps.”

The new network will also be a “demand side platform” permitting dynamic bidding for impressions on third party sites. Given the data that Facebook has about its users the new platform could pose a formidable challenge to Google (not to mention Yahoo).

In 2013 Google made just over $13.2 billion from non-Google sites displaying its ads. Perhaps the most interesting and provocative aspect of the WSJ report involves the cookie-less cross-platform dimension of the network. The idea is to turn the Facebook ID itself into the new cookie:

 With Atlas, Facebook hopes to fix those [cookie] problems by linking users’ ad interactions to their Facebook accounts, which can be used to track users across both desktop and mobile devices, albeit on an anonymous basis. For example, a marketer using Atlas might now be able to understand that a customer purchased a product on a desktop computer, but first saw an ad for it on their smartphone device. Facebook already tracks users this way across its own service, but Atlas will now extend the functionality to other sites and apps. Facebook also plans to pitch marketers on the concept of using Atlas to tie consumers’ offline behaviors to their online ones. For instance, a consumer who purchases a pair of shoes in a store might volunteer her email address at the checkout. Facebook could then use that email address to inform the retailer if, when, and where the consumer saw its ads across the Web, if the email address is tied to a Facebook account.

 The difference between this and other behavioral solutions is that Facebook has far more data and far more accurate data on users’ preferences, likes, interests and cross-platform behavior than any other advertising entity or platform. In some ways this is the realization of what Facebook has been building toward. However the depth and comprehensiveness of the approach is sure to draw the scrutiny and (probably) ire of European regulators if not others, eventually, around the world.