Sprial waves, cyclone

We’ve all heard of Meta by now, the parent company of Facebook and Instagram, headed by Mark Zuckerberg.

In a significant pivot that could reshape the advertising landscape, Meta has announced its intention to seek consent from EU users before displaying personalized ads.

This change is a departure from Meta’s previous reliance on “legitimate interests” as a basis for targeted advertising – data processing, carried out mainly to benefit the company’s interests and overriding anyone else’s.

So how could this development impact both advertisers and the digital advertising ecosystem?

Regulatory Winds of Change

The shift comes from regulatory rulings that have raised questions about the legality of Meta’s data processing practices.

Ireland’s Data Protection Commissioner and other regulatory bodies have challenged Meta’s use of user data for ad targeting without having gained explicit consent.

As a result, Meta has decided to change its approach, adjusting the legal basis for processing certain data from solely considering “legitimate interests” to actively requiring the user’s consent.

Advertisers need to focus on trust

For advertisers, this change underscores the need to transition from data-centric strategies to trust-based engagement.

With a diminishing reliance on third-party targeting, the focus on first-party data and authentic brand communication is increasing.

This adjustment emphasizes the importance of classic marketing disciplines such as:

  • segmentation,
  • targeting,
  • positioning,
  • aligning marketing with evolving user privacy preferences.

To track, or not to track?

This move by Meta is just one facet of the broader transformation in the digital advertising ecosystem.

Apple’s introduction of the App Tracking Transparency (ATT) feature, allowing users to opt in or out of app tracking, has already reshaped user data access for advertisers. Now, Meta’s shift adds another layer of complexity.

The landscape is changing rapidly, calling for us to be more adaptable and creative within our marketing strategies, in line with regulations.

Privacy Policies: a foundation for user control

Meta’s decision aligns with the growing emphasis on user consent and privacy. Users are generally hesitant to share personal information online even on reputable platforms, with the rise of hacking and fraud a serious threat.

User consent empowers EU users to have more control over their online experience and personal data.

Privacy activists and experts anticipate that many users will opt out of targeted ads, reflecting their desire for more control over their online privacy.

The potential cost of privacy

Advertising accounted for a substantial 97% of Meta’s revenue in the previous year.

While this decision is a step towards user privacy, it also has potential implications for Meta’s revenue streams.

The transition might impact the company’s bottom line as the personalised ad model faces financial challenges in the EU market.

So where are we now?

Meta’s announcement demonstrates a significant change in the digital advertising landscape.

As users gain more control over their data and privacy, advertisers must navigate this new terrain with careful consideration and a customer-centric approach.

This decision underscores the importance of building authentic relationships with users, leveraging first-party data, and embracing evolving privacy regulations.

The advertising world is evolving, and businesses that adapt will find new avenues for growth and success.