Meta will now ask EU users for consent before showing them targeted advertising in a move that could limit the ability of marketers to personalise ads on the platform.
The Facebook and Instagram owner had previously claimed “legitimate interest” under EU law to allow it to process users’ data to serve them personalised advertising. However, after a number of regulatory rulings, Meta has now confirmed this will change.
“We are announcing our intention to change the legal basis that we use to process certain data for behavioural advertising for people in the EU, EEA and Switzerland from ‘legitimate interests’ to ‘consent’,” Meta wrote in a blog post announcing the change yesterday (2 August).
This follows a ruling from Ireland’s Data Protection Commissioner (DPC) in January, which acts as Meta’s chief regulator in the EU, ordering the company to reassess the legal basis of how it targets ads.
The UK’s Information Commissioner’s Officer (ICO) has said the decision by Meta excludes the UK. It did say, however, that it is paying “close attention” and is “assessing what this means for information rights of people in the UK”.
Meta brought in $60bn (£47bn) in advertising revenue globally in the six months to the end of June 2023. It is a major platform for advertisers of big and small brands alike, with many using targeting to reach a particular audience.
The platform’s announcement that it will seek users’ consent to target ads in the EU marks just one change in a digital advertising ecosystem already rapidly shifting, says Alex Murphy, the founder and CMO of Balance, a financial services digital marketing agency, and former marketing director at Admiral Group.
“For marketers, the change underscores the necessary move from data-centric strategies to trust-based engagement,” he tells Marketing Week. “That’s not new, it’s almost like we’re course-correcting back to classic marketing disciplines like segmentation, targeting and positioning.”
For marketers, the change underscores the necessary move from data-centric strategies to trust-based engagement.
Alex Murphy, Balance
He adds that third-party targeting should have “never been a substitute for this discipline”, and that, with broader industry changes, it can no longer be. These changes stress “the importance of first-party data and authentic brand outreach,” he says.
In 2021, Apple introduced a new privacy feature, App Tracking Transparency (ATT). This meant app users had to opt in to tracking for each individual app. On average, app tracking was opted into just more than one third (35%) of the time in the second quarter of 2023, according to mobile attribution and analytics company, Adjust.
Speaking to The Guardian, privacy activist and senior fellow at the Irish Council for Civil Liberties, says as with ATT, he believes most users would not opt in to targeted ads on Meta.
“If they do this in the way they are obliged to in law, no one will ever say yes to all of the things they are doing. You can say no to some of the toxic elements of Meta’s business and still enjoy the service,” he told the newspaper.
As well as the implications this may have for advertisers, these changes may damage Meta’s ad businesses, on which its revenues heavily rely. Advertising accounted for 97% of Meta’s revenue in 2022.