Facebook Now Tracks Consumers' Retail Purchases

Todd Wasserman
Facebook Now Tracks Consumers' Retail Purchases
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Facebook is working with a data mining firm to show marketers that consumers who see ads on the social network actually buy advertised products.

The company has purchased data on 70 million U.S. households from Datalogix, which culls information from loyalty cards and programs from more than 1,000 retailers, according to The Financial Times. Datalogix matches emails and data associated with those cards and programs with emails and information required to set up a Facebook account, according to the report. Using this information, the company can say whether a consumer purchased an item after seeing it advertised on Facebook.

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Brad Smallwood, Facebook's head of measurement and insights, told the publication that Datalogix and Facebook have tracked 45 campaigns. In 70% of those campaigns, a dollar spent on Facebook resulted in $3 in sales, Smallwood said.

The report comes after Facebook last month allowed marketers to match users' email addresses and phone numbers with their own data profiles. The change means brands can now target users on Facebook even if those consumers haven't "Liked" the brands.

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While such access is great news to marketers, privacy advocates wonder whether using Datalogix violates Facebook's $9.5 million settlement with the Federal Trade Commission over privacy practices. As part of the deal, Facebook must make it clear to users when the social network shares their information beyond what their privacy settings mandate, operate a program to protect users’ privacy and get users’ approval before sharing their information.

Reps from Facebook could not be reached for comment on the report.

This story originally published on Mashable here.