Facebook Inc (NASDAQ:FB) has teamed up with Datalogix, which is a company that connects offline purchasing data to digital advertising. The partnership allows the two companies to work together, and determine the offline impact of Facebook’s online advertising.
According to Datalogix research, Facebook’s ads contributed an extra $3 per sale in 70% of the cases studied. Datalogix admits that they purchase data involving approximately 70 million American homes. The data is compiled through various loyalty rewards programs and cards, and involves more than 1,000 retailers. The company will then match email addresses and other information with the collected info from retailers. This then allows them to connect users with their respective Facebook Inc (NASDAQ:FB) accounts, and track their purchase history alongside of which advertisements they see on a regular basis.
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While this may seem like a great way to gather information for advertisers, as proof of their ability to connect with users through Facebook, it has also raised some serious concerns about user privacy. Facebook Inc (NASDAQ:FB) had this to say, regarding privacy issues:
“We know that people share a lot of information on Facebook, and we have taken great care to make sure that we measure the effectiveness of Facebook ads without compromising the commitments we have made on privacy. We don’t sell people’s personal information, and individual user data is not shared between Facebook Inc (NASDAQ:FB), Datalogix, or advertisers.”
However, this statement is hardly enough to allay the fears that many people have of being spied upon by the social network. According to AllFacebook.com, there’s already a movement seeking to involve the FTC in an investigation of the matter.
CNET cites Jeff Chester, who is the executive director of the Center for Digital Democracy, as saying:
“I believe the FTC should be investigating all this as part of its review under the consent decree … Ad exchanges allow them to take this data and apply it in real-time and sell it to the highest bidder, including Facebook. They are using reams of additional data, including from online, to target Facebook users.”
It seems that in its attempts to conquer advertising, both mobile and desktop in nature, Facebook Inc (NASDAQ:FB) may be overstepping its bounds. We have already reported of other woes facing the company in recent months, and losing a big source of information is sure to slow them down in their efforts to climb the mountain of issues that currently faces the company.