How Meta’s New Targeting Rules Will Revolutionize Marketers' Strategies
Meta's new targeting rules in the EU may restrict marketers' ability to personalize ads on its platforms by requiring users to consent to targeted advertising
In a move that could restrict marketers from customizing ads on the platform, Meta will now seek consent from EU users before displaying targeted advertising. Previously, the owner of Facebook and Instagram had relied on the "legitimate interest" provision under EU law to process user data for personalized ads. However, following regulatory rulings, Meta has now confirmed a change in approach.
"We have made the decision to update the legal foundation for processing particular data for behavioral advertising purposes for individuals in the EU, EEA, and Switzerland. In a blog post released on the 2nd of August, Meta stated that the change will involve transitioning from the use of 'legitimate interests' to 'consent'. This decision was influenced by the ruling of Ireland's Data Protection Commissioner (DPC) in January, who serves as Meta's primary regulatory authority within the EU. The DPC had directed the company to review the legal basis for its ad targeting practices."
The UK's Information Commissioner's Office (ICO) has stated that Meta's decision does not include the UK. However, the ICO acknowledged that it is closely monitoring the situation and evaluating the impact on individuals' information rights in the UK.
In the first half of 2023, Meta generated $60 billion (£47 billion) in advertising revenue worldwide. Serving as a significant platform for both large and small brands, Meta enables advertisers to effectively target specific audiences.
The platform's recent announcement to obtain consent from EU users for targeted advertising is just one of the many changes occurring in the rapidly evolving digital advertising industry, according to Alex Murphy. As the founder and CMO of Balance, a financial services digital marketing agency, and former marketing director at Admiral Group, Murphy emphasizes that this shift reinforces the importance for marketers to prioritize trust-based engagement over data-centric strategies. This change harks back to traditional marketing practices such as segmentation, targeting, and positioning.
For marketers, the change underscores the necessary move from data-centric strategies to trust-based engagement.
Alex Murphy, Balance
He asserts that relying on third-party targeting as a replacement for this practice should have never been acceptable, and now, due to extensive changes in the industry, it is no longer viable. These modifications emphasize the significance of utilizing first-party data and establishing genuine connections with the brand.
Last year, Apple unveiled a new privacy feature called App Tracking Transparency (ATT). This feature required app users to actively opt in to allow tracking for each individual app. According to mobile attribution and analytics company, Adjust, app tracking was chosen by users just slightly over one third (35%) of the time in the second quarter of 2023.
According to a privacy activist and senior fellow at the Irish Council for Civil Liberties, most users would not choose to receive targeted ads on Meta, similar to ATT. He stated to The Guardian that if Meta follows the legal obligations, people would refuse to agree to all activities. One can reject certain negative aspects of Meta's business and still benefit from the service.
In addition to the potential implications for advertisers, these alterations could undermine Meta's advertising enterprises, on which its revenue heavily depends. Advertising constituted 97% of Meta's revenue in 2022.
