Goshen News, Goshen, IN

Community News Network

March 20, 2013

Slate: Facebook is making you buy things

(Continued)

PALO ALTO, Calif. —

This isn't conjecture. It's science. It's based on a remarkable set of in-depth studies that Facebook has conducted to show whether and how its users respond to ads on the site. The studies demonstrate that Facebook ads influence purchases and that clicks don't matter. They also shed light on Facebook's long-term business strategy.

The tech world is consumed by the war between Facebook and Google — two huge sites that are constantly battling one another for users, engineers and advertising clients. Yet Facebook's studies suggest that its advertising fortune won't necessarily come at the expense of Google. Instead, the findings show that people react to ads on Facebook in the same way they respond to ads on television. If Facebook's ad business takes off, it might be at the expense of the biggest ad-supported medium in the world.

Last year, Facebook partnered with Datalogix, a firm that records the purchasing patterns of more than 100 million American households. When you stop by the supermarket to buy Tide, Rice-A-Roni and Mountain Dew this evening, there's a good chance you'll hand the cashier a loyalty card to get a discount on your items. That card ties your identity to your purchases — it puts a name on your Tide, Rice-A-Roni and Mountain Dew. After you leave the store, your sales data is sent over to a server maintained by Datalogix, which has agreements with hundreds of major retailers to procure such data.

Over the past few months, Facebook and Datalogix figured out a way to match their data sets in a manner that maintains people's privacy. In other words, Facebook can now tie its users to the stuff they buy at supermarkets. Armed with this data, Facebook began running a series of analyses into the effects of advertising campaigns on its site. If, say, Procter & Gamble ran a Facebook ad for Tide, Facebook could look at Datalogix's data to see whether people who were exposed to the ad tended to purchase more Tide in the weeks after the campaign. (Tide is just an example here; Facebook has conducted more than 60 such studies for major advertisers, and while it was willing to give me general insights about its findings, it wouldn't discuss specific advertisers.)

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Poll

Last weekend (July 12) the Goshen Parks Department held its Kid’s Try-athlon to promote childhood fitness and this week (July 18) the new bicycle trail is open to the fairgrounds in Goshen, offering residents a healthy way to get to the annual agriculture exposition. Have you joined the local fitness movement?

Yes, I work at eating healthy and exercising
No, I am happy with my fitness level
Changing my diet and exercise frequency is a work in progress
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