Tags: Facebook | privacy | ad | tracking

FT: Privacy Advocates Worried about Facebook Ad Tracking

By Dan Weil   |   Tuesday, 25 Sep 2012 10:16 AM

Facebook is looking at new methods to track whether users who see ads on its site actually go ahead and buy those products in stores.

But the increased intrusion worries privacy advocates, the Financial Times reports.

Facebook is working with a data company called Datalogix, which developed the tracking method. The social networking titan faces pressure from advertisers to prove the worthiness of ads on its site.

Editor's Note: The ‘Unthinkable’ Could Happen — Wall Street Journal. Prepare for Meltdown

“We kept hearing back [from marketers] that we needed to push further and help them do a better job,” Brad Smallwood, Facebook’s head of measurement and insights, tells the Times.

Datalogix has access to data from loyalty cards at more than 1,000 retailers. It can match e-mails or other information on those cards with information Facebook users provide to establish their accounts.

So Datalogix can track whether people bought a product in a store after seeing an ad for it on Facebook.

Datalogix is supposed to keep all the names private. But Jeff Chester, executive director of the Center for Digital Democracy, is worried nonetheless.

“We don’t believe any of this online-offline data should be used without express consumer approval and an opt-in,” he tells the Times.

Meanwhile, Facebook shares have hit another rough patch. They dropped 9 percent Monday to $20.79, after Andrew Bary of Barron’s tabbed their fair value at $15.

He cites "high multiples of both sales and earnings, even as uncertainty about the outlook for its business grows" as the reason for his valuation.

Editor's Note: The ‘Unthinkable’ Could Happen — Wall Street Journal. Prepare for Meltdown

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