Advertising on Facebook is about to get much more coherent for consumers and advertisers alike. Currently being tested by developers, Facebook Exchange will track visitors who visit third-party sites with a cookie, and then update the ads displayed to that user in real-time.
In other words, a Facebook user who visits an online shoe retailer whose site is connected with Facebook Exchange will, when they return to the social networking platform, be served ads directly from that retailer. This is all accomplished through demand-side platforms (DSP).
An advertiser’s DSP will inform Facebook when they wish to re-target their marketing to a specific user. Then, using an anonymous User ID granted by Facebook, the advertiser pre-loads ads for their new individual target. In the future, whenever this user visits Facebook, the DSP is able to make a real-time bid to get their ads displayed. With multiple advertisers vying for one user’s attention, the largest bidder will get their targeted ads shown to the Facebook member.
Of course, as with all Facebook updates, privacy control is the primary concern for users. Users will be able to opt out of being exposed to ads generated through the Facebook Exchange; however, there is currently no way to opt out of the program entirely through Facebook. Users will have to visit the sites of DSPs in order to exclude themselves from targeted advertisements.
Despite the extra effort required to avoid being exposed to Facebook Exchange ads, the social networking platform is making privacy a priority by not allowing their re-targeting to use biographical data or social activity from Facebook profiles.