Using Facebook’s Demographic Data for Market Research

Photo credit: marcopako  on Flickr.In today’s business environment, results need to be measured and success needs to be proven.

That’s just the way it is.

The Internet has given brands the ability to measure a lot of things (e.g., pageviews, unique visitors, conversion rates, click-through rates, etc.)

And, social media monitoring tools are getting more sophisticated.

However, up until recently, most of the metrics that were available to online marketers were used to gauge the success of their direct marketing campaigns.

Very few tools were available to help brand marketers.

Nielsen is looking for ways to change that.

Nielsen’s Online Campaign Rating System

In an effort to help brand marketers justify their online ad spend to senior management, Nielsen has created what it calls the Online Campaign Rating system that debuted earlier this month.

As an article on fastcompany.com, titled “Facebook Is The New Nielsen Family,” explains, “Here’s how it works: Advertisers tag their ads and then place them on their targeted sites around the web. When the ads are viewed, the ads make a call to Facebook, which then searches its own user database to identify the viewer of the ad. Facebook then gathers up that person’s demographic information and sends it to Nielsen. Nielsen is then able to report back to advertisers who saw their ads in a particular campaign.”

The Nielsen Company also posted a video on YouTube, titled “Nielsen Online Campaign Ratings,” that gives a brief explanation of their new product.

The Nielsen Family

As the article on fastcompany.com points out, historically advertisers have relied on Nielsen’s panels (often referred to as “Nielsen families”) to gauge who watched a particular episode of a television program.

The methodology used by Nielsen for collecting information on television viewership has been analyzed and accepted by industry experts for many years.

Nielsen created the Online Campaign Ratings system to serve a similar function in the online world.

The problem is that in its early stages, it appears that Nielsen is currently relying only on Facebook to supply the demographic information.

Concerns With Facebook Demographic Data

Facebook, as you know, is a social networking site that is used by people all over the world for many purposes.

While Facebook collects tremendous amounts of data on the people who use its social networking site, at the end of the day, it is still a social networking site.

Therefore, there is no guarantee that the information that people list on their Facebook profiles is valid.

As the movie Catfish (affiliate link) points out, there are people on Facebook who aren’t who they say they are. In fact, a person could, if he or she wanted to, create multiple Facebook profiles under different aliases or pseudonyms as long as he or she had multiple email addresses. (And, as you know, that’s not a difficult hurdle to jump.)

Furthermore, in episode 163 of The BeanCast, titled “Trending Trouble,” Cindy Gallop, CEO and founder of IfWeRanTheWorld, pointed out that people who she knows, particularly those in Gen Y, use the family and featured friends lists on Facebook to highlight members of their “posse,” even if they don’t actually fit the category for which they are listed. In other words, the information that they are providing to Facebook is completely incorrect. (Note: If you get a chance, I recommend that you listen to episode 163 of The BeanCast. In this episode, Bob Knorpp and his guests tackle several very interesting topics, including the one that I am currently blogging about.)

Another issue with using Facebook as the only source of demographic data is that people are fickle. Although Facebook is currently a very popular social networking site, it is entirely possible that people could lose interest in the site in the future. (It can happen, just look at Myspace.)

And, even if they don’t migrate to another social networking site, there is no requirement that people keep their demographic data up-to-date (if they enter it at all.)

Furthermore, privacy issues can influence the validity of Facebook’s demographic data.

As time goes on, more and more people have become concerned with Facebook sharing its data with third-party vendors, even though Facebook says that it is taking steps to protect its users.

This healthy skepticism may be another reason for Facebook users to leave off some of their demographic information (or fabricate some of the information) on their Facebook profile.

The Future of Nielsen’s Online Campaign Rating System

There are some very intelligent people who work for Nielsen.

Therefore, I can guarantee that they have thought about these issues, and many more.

In fact, as the article on fastcompany.com points out, “Facebook isn’t the whole solution for Nielsen, however. Only about half of Americans are on the social network which means that OCR can only provide accurate demographics on about 42%, on average, of a campaign’s impressions, Buchwalter says. So Nielsen will still have to bring in more publishers to play the same role as Facebook and fill in the remaining gaps.”

As they add additional sources of data, Nielsen will hopefully be able to verify the validity of the demographic data that they receive from each of their sources.

However, that option is not currently available to them.

Conclusion

Nielsen’s Online Campaign Rating system is a very valuable tool that will help brand marketers measure the reach of their online marketing campaigns.

However, in its early stages, Nielsen is relying only on Facebook to provide that information.

As mentioned, brands using the data should be aware that there are some limitations to the accuracy of the data obtained via Facebook.

People can, and often do, provide incorrect information on their Facebook profiles for a variety of reasons.

It should be noted that Nielsen is one of the most trusted sources of market research data out there.

However, it is appropriate, even suggested, that you scrutinize the data that you receive, even if it is coming from a trusted source.

The data that brands receive from Nielsen can only be as good as the data that Nielsen receives from the organizations that it has partnered with.

In the future, when Nielsen partners with additional organizations to collect demographic data, it will give them the ability to cross-check the data and verify its accuracy.

However, in my opinion, as long as the data is only coming from one source, and that source is Facebook, the accuracy of Nielsen’s data cannot be guaranteed.

At the end of the day, Facebook is a social networking site, not a government tax form where falsifying information could lead to penalties.

As such, the demographic data obtained from Facebook should be taken with a grain of salt.

That’s my take on the topic. Whether you agree or disagree with me, I’d really like to hear your opinion. So, please feel free to comment below.

Photo credit: marcopako  on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

More Posts

Copyright © chadjthiele.com
Every interaction with a consumer IS marketing.

Built on Notes Blog Core
Powered by WordPress