Facebook to Make Targeted Ads More Transparent For Users

Move Is Another Step Toward Web-Wide Ad Network

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Facebook is about to get more transparent in the way it targets advertising at its users.

The social network has agreed to start displaying the little blue "AdChoices" icon on its display ads served through its FBX ad exchange after months of public and private complaints from ad agencies and advertisers.

Facebook's 'AdChoices' icon
Facebook's 'AdChoices' icon

The icon -- intended to provide enhanced notice of behavioral targeting and allow users to opt-out -- will look the same as the one seen across the web, with one big caveat. Rather than appearing directly on FBX display ads, the symbol will show up only when users mouse over the gray "x" displayed above the ads shown on Facebook's right rail.

Even the "x" only appears when someone mouses over it, so people not familiar with the feature won't always be made aware that an ad was targeted using third-party data gathered elsewhere online.

On the face of it, the move is progress for the industry's most pervasive self-regulatory ad privacy program. However, whether the implementation satisfies the original mission of the Digital Advertising Alliance program is up to debate.

Facebook has suggested its users are accustomed to ad related information appearing in this format. Currently, the "About this ad" option shown in FBX ads link to opt-out pages provided by the DSP partner that enabled the ad.

"We have always given our users the ability to provide feedback on and control the ads they see on Facebook, by hiding, reporting, or clicking through to learn more about why particular ads are being served, said Brian Boland, Facebook's director of product marketing, in a statement e-mailed to Ad Age. "Giving advertisers the ability to implement the AdChoices icon provides another option; another mechanism of control."

Implementing the icon, which brands and agencies use for big online display campaigns, could be seen as another step toward Facebook's third-party ad network. Some advertisers won't buy behavioral campaigns across the web without it.

But Facebook's manner of implementing the icon--seen only when a user mouses over the ad--raises questions as to whether it complies with Federal Trade Commission guidelines calling for "clear and prominent notice" when an ad is behaviorally targeted.

"I knew that would be the reaction of some people," said Genie Barton, director of the Online Interest-Based Advertising Accountability Program, which is part of the Advertising Self Regulatory Council and Council of Better Business Bureaus. "We wanted first of all to get something up," she said. "This is a pretty fast ramp-up for a new system." The icon will be displayed in desktop FBX ads only since the FBX system does not operate in the mobile environment.

Ms. Barton and her staff worked directly with Facebook to come to an agreement regarding the icon starting soon after the company launched its FBX offering in September.

The end result affects lots of companies, from the DSP partners in Facebook's FBX program to media agencies buying ads on the exchange. For instance, the absence of the icon on Facebook has caused headaches for agencies including Publicis-owned Vivaki, which encompasses Digitas, Razorfish, Starcom MediaVest and Zenith Optimedia.

The digital ad buyer keeps records of its clients' behavioral ad campaigns, including those that run on Facebook's exchange, to ensure compliance with the DAA initiative. Lawmakers and the FTC are stepping up pressure on the ad industry to improve its approach to consumer privacy, and online ad buyers such as Vivaki need to ensure compliance with self-regulatory guidelines.

Most of Vivaki's campaign-compliance reporting is done automatically through a relationship with Evidon, one of two firms approved to serve the icon and manage compliance reporting. It is not clear whether the Facebook implementation will enable automated reporting for firms like Vivaki. The DSPs requesting the icon in their ad calls will choose the landing pages for the icon.

"If there is a business that feels that this solution won't let them serve the icon appropriately, they have only to let me know," said Ms. Barton.

"We need the publishers to adopt the industry standard," said Grace Liau, senior VP for Vivaki, when speaking with Ad Age about the issue last month. "We cannot have everyone embrace it in their own flavor," she said.

Facebook will start including the icon in FBX ads by the end of March.

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