Unpacking Facebook’s Upcoming Changes to Custom Audiences

Facebook's 2018 revisions to its Custom Audiences tool, announced in the wake of the Cambridge Analytica scandal and ahead of the May 25th GDPR compliance date, are examined for what they mean for marketers and for platform power. The central argument is that most of the changes were modest, but that the broader trajectory could strengthen the advertising duopoly by making advertisers more dependent on Facebook's proprietary data.

Two early changes were largely cosmetic. On March 23rd, Facebook removed reach estimates for custom audiences after Northeastern University researchers found a vulnerability that could identify individuals. On March 28th, it ended the Partner Categories program, which let advertisers use data-broker information from firms such as Experian and Acxiom. Because third-party data can still be uploaded to build custom audiences, the move appears to shift responsibility for data provenance onto advertisers rather than restrict targeting.

The more consequential change, clarified for a July 2nd rollout, follows an April announcement of a permissions gate certifying that uploaded data was collected with consent. It takes two forms: advertisers must declare whether audience data came directly from users, from a third party, or from both, with that information displayed in each ad's "Why am I seeing this?" portal; and partners such as agencies must certify their business relationships before sharing audiences within Facebook's ad manager. This distributes data stewardship across everyone in the advertising chain.

Custom audiences, especially lookalike targeting built from an advertiser's most valuable users, are described as among Facebook's most valuable targeting tools and a major competitive advantage given its more than one billion daily active users. The author poses a forward-looking question: if further policy changes or enforcement neutralized custom audiences, would advertisers leave or shift spend toward event-based bidding that relies entirely on Facebook's own data? If the latter, these changes and GDPR would reinforce the walled gardens and the duopoly.