Facebook closes sales loop; takes a bite out of the cookie

Sarah Homewood
By Sarah Homewood | 8 March 2016

Facebook's Atlas has doubled-down on its measurement capabilities, with the social giant announcing businesses can now compare offline point-of-sale (POS) data to that of Atlas' data to get an accurate picture of the path to purchase.

These new 'Offline Actions' and 'Path to Conversion' tools will allow marketers to put real data behind their digital and mobile spend, that goes beyond the cookie, and Facebook expects this will lead to an increase in spend in the space.

Mobile adspend in the US is set to hit $42 billion this year, equating for 21.6% of total media ad spending, with those numbers tipped to grow substantially over the next three years. In 2019, it's predicted that spend on the medium will grow to $65.4 billion and to 28.9% of total media ad spending.

'Offline Actions' will allow advertisers who measure their ads with Atlas to now upload their POS data and understand if their online ads are influencing offline purchases.

With 'Path to Conversion' it gives marketers the insight into the way people see their ads online, and gives an indication of those same people who saw that ad that then bought the product.

Head of ad tech for Facebook, David Jakubowski, told AdNews that these tools will be able to do something the internet has never done, which is connect “absolutely everything”.

“Mechanically, what happens is when you walk into a store and you purchase something, that merchant knows for a fact that you bought something," Jakubowski explains.

"The business then takes those files and loads them into their CRM systems. You can export a file from that POS file attached to something as simple as your email address. You can then hash that email address and then upload it against Facebook's list of billions of email addresses, 1.95 billion people, to attach a match."

He says as a marketer, you then know who this is so can then go back and look at all the ads the brand ran to see which ones were seen by that person.

When asked about privacy, Jakubowski reiterated that all the data is hashed and that all the tools are privacy compliant. He also added that: “When customers use Atlas, it has precluded Facebook from learning from any transaction that they have.”

During the testing phase of these tools, Mini Australia and its digital creative and media agency, MobeSeek, worked with Atlas on testing its mobile site conversions for the first time. The people-based measurement found that 30% of all conversions were desktop-to-mobile, an insight Facebook says cookie-based measurement would've missed. Before using Atlas, MobeSeek was managing Mini's mobile presence but couldn't see how people were interacting across multiple devices.

“Now marketers want to see all these paths. Mini was able to see that 30% of all its conversions were happening desktop to mobile," Jakubowski says.

"People were seeing an ad on desktop and transferring to mobile. They were looking at its mobile site, looking at the app and taking action, finding dealers, designing the new Mini that they wanted - these actions all have value to Mini."

“Marketer’s can now see that full picture, so when they're spending their dollars they know where to put them to maximise new customer acquisition, which is what every marketer chases,” he added.

When it comes to the cookie, Jakubowski believes that people will start to move away from the old technology.

“The reality is for the last two-to-three years the cookie hasn't worked particularly well,” he says.

"People are still using it because they haven't switched off the old technology, but in the next 12-18 months, if you're a marketer and you don't switch off from a cookie-based system to a people-based one, your competition will just run right past you.”

The industry needs to do better

As part of the announcement today, Atlas also revealed the findings from a test it did with the buying platform in Atlas.

It found that while it was able to deliver ads to real people with “unprecedented accuracy”, it was up against many bad ads and fraud caused by bots. It ran the same test with Facebook's video exchange, LiveRail, and found the same thing.

This caused Facebook to “immediately” shut off the low quality ads. The move saw Facebook remove more than 75% of the volume coming from its exchange by turning off publishers circulating bad inventory into LiveRail. The trouble with this was that, according to Jakubowski, is that 100% of the inventory they blocked, was then simply taken up by other exchanges.

“The marketing departments, the agencies and the advertisers still bought that inventory,” he explained. “They didn't have the measurement behind their tools, the way that we did, to know how bad it was. So here's Atlas is saying: “Hey marketers, if you want to use these tools, you are welcome to do so. Those who do, will be filtering out all those bad impressions from those other sources and feeding those bad impressions to their competitors.”

Jakubowski added however: “The industry need to improve, it needs to step up.

“There are just too many machines that are making too much inventory and the technology hasn't made the switch. You're starting to see companies migrate their tech stacks over to people-based systems, those that do will have advantages over those that don't.

“We're at a natural affliction point where the industry hasn't kept up with the consumer and that's our focus. Mobile as an industry won't grow unless marketers can demonstrate value.”

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