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Meta Fined $414 Million, Forced to Change its Approach to Ad Personalization in Europe

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NFTs are Coming to Facebook and Instagram – Whether You Like Them or Not

Meta could be forced to make significant changes to its targeted ad offerings in Europe, after EU regulators ruled that the company has been illegally forcing users to effectively accept personalized ads in its apps.

The ruling, along with a fine of 390 million ($US414 million), could force Meta to restructure its current ad systems, and how it gains user permission for such within its apps. Effectively, the ruling suggests that Meta may need to get direct legal consent from each of its 408 million EU users in order to show them personalized ads – or it risks further fines for breaching the EU’s GDPR.

Of course, Meta does, essentially, already gain individual permission for such, by incorporating this agreement into its lengthy terms and conditions. But the ruling indicates that this may not be clear enough under GDPR guidelines, and that Meta may need to gain more explicit consent for ad personalization moving forward.

In response, Meta has said that it plans to fight both the ruling and the fine, and that the judgment will not impede its processes in Europe.

As per Meta:

We strongly believe our approach respects GDPR, and we’re therefore disappointed by these decisions and intend to appeal both the substance of the rulings and the fines.”

In regards to potential restrictions of its operations, Meta notes that it uses ‘a combination of legal bases to provide various services’, which means that even if the ruling is upheld, it’ll still be able to deliver personalized ads in the region.

“It’s important to note that these decisions do not prevent personalized advertising on our platform. The decisions relate only to which legal basis Meta uses when offering certain advertising. Advertisers can continue to use our platforms to reach potential customers, grow their business and create new markets.”

Meta says that it has long relied on a legal basis called ‘Contractual Necessity’ to show people personalized ads in its apps, but now, EU officials are pushing it to change its approach. Which, in Meta’s view, won’t restrict it from its regular operations, it will just change the legal clause under which it potentially operates. 

The decisions do not mandate the use of Consent – another available legal basis under GDPR – for this processing. Similar businesses use a selection of legal bases to process data, and we are assessing a variety of options that will allow us to continue offering a fully personalized service to our users. The suggestion that personalized ads can no longer be offered by Meta across Europe unless each user’s agreement has first been sought is incorrect.

So, effectively, in Meta’s view at least, it will continue to offer personalized ads in the same way that it always has. It may just need to clarify exactly how it goes about it – which should have little impact on users and advertisers themselves.

But it’s more regulatory work for Meta, and more provisions and processes added by the GDPR framework. Which is good, in theory, and provides more data protections for EU users. But in practical application, it’s hard to say whether the whole GDPR push has actually been of significant benefit, on balance.

Either way, Meta will now have three months to respond to the EU ruling, which, as Meta notes, will see it appeal, and potentially re-align its usage terms around another legal clause in the region.

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Twitter Tests Expanded Emoji Reaction Options in DMs

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Twitter Tests Expanded Emoji Reaction Options in DMs

Twitter’s looking to give users a broader set of emoji reactions for their DMs, while also, potentially, enabling personalization of your quick reactions display in the app.

As you can see in these mock-ups, shared by Twitter designer Andrea Conway, Twitter’s testing a new search option within the reaction pop-up in DMs which would enable you to use any other emoji as a reaction to a message.

An extension of this would also be the capacity to update the reactions that are immediately displayed to whatever you choose.

Twitter DM reactions

It’s not a game-changer by any means, but it could provide more ways to interact via DMs, and with more interactions switching to messaging, and more private exchanges, it could be a way for Twitter to better lean into this trend, and facilitate a broader array of response options in-stream.

Twitter’s working on a range of updates as it looks to drive more engagement and usage, including tweet view counts, updated Bookmarks, a new ‘For You’ algorithm, and more. Elon Musk has said that he can envision Twitter reaching a billion users per month by next year, but for that to happen, the platform needs to update its systems to show people more of what they like, and keep them coming back – which is what all of these smaller updates, ideally, build to in a broader approach.

But that’s a pretty steep hill to climb.

Last week, Twitter reported that it’s now up to 253 million daily active users, an increase on the 238 million that it reported in July last year. Daily and monthly active usage is not directly comparable, of course, but when Twitter was reporting monthly actives, its peak was around 330 million, back in 2019.

Twitter MAU chart

As noted in the chart, Twitter switched from reporting monthly active users to daily actives in 2019, but looking at the two measurements, it’s hard to imagine that Twitter’s monthly active usage is any more than 100m over its current DAU stats.

That means that Twitter has likely never reached more than 350 million active users – yet Musk believes that he can best that by close to 200% in a matter of months.

Seems unlikely – even at current growth rates since Musk took over at the app, Twitter would only be looking at around 500 million users, optimistically, by the end of 2024.

If it can maintain that. More recent insight from Twitter has suggested that user activity has declined since those early post-Musk purchase highs – but maybe, through a range of updates and tweaks, there could be a way for Musk and Co. to maximize usage growth, beyond what seems possible, based on the stats.

We’ll find out, and as it pushes for that next level, you can expect to see more updates and tweaks like this, with enhanced engagement in mind.  



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Tarte Influencer Marketing Criticized 01/31/2023

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Tarte Influencer Marketing Criticized 01/31/2023

With consumers obsessed over the price of a dozen eggs, could conspicuous consumption-driven influencer marketing falling out of favor? That is the question brands might be considering after the
backlash that cosmetics brand Tarte is receiving after a sponsored trip to Dubai. “Influencers were called out for appearing not …

Read the whole story at Marketing Brew »



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Twitter Applies for US Licenses to Facilitate In-App Payments

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Twitter Applies for US Licenses to Facilitate In-App Payments

Twitter has taken its next steps towards facilitating payments in the app, with The Financial Times reporting that the company has begun applying for regulatory licenses in US states, the next legal requirement for providing payment services in the app.

Payments, which Elon Musk has a long history in, could be another way for Twitter to generate revenue, by enabling transactions between users, from which it would then take a small percentage. Musk has repeatedly flagged his vision for payments as part of his broader push to make Twitter into an ‘everything app’, which would provide more functionality and usage benefits.  

As reported by FT:

In November, Twitter registered with the US Treasury as a payments processor, according to a regulatory filing. It has now also begun to apply for some of the state licenses it would need in order to launch, these people said. The remainder would be filed shortly, in the hope that US licensing was completed within a year, one of the people said.”

From there, Twitter would also look to establish agreements with international regulators to enable payments in all regions.

As noted, payments are a part of Elon’s broader plans for a more functional app, which would replicate the utility of China’s WeChat, which is used by Chinese citizens for everything from ordering groceries, to buying public transport tickets, to paying bills, etc. WeChat has become such a crucial connective element, that it formed a key part of China’s COVID response, with authorities using the app as a means to manage COVID positive citizens and restrict their movement.

Musk isn’t ideally looking to use Twitter as a control device (I don’t think), but the broader concept is to add in more and more functionality, in order to both generate more income for the company, and make the app a more critical element in the interactive landscape.

Twitter’s already exploring several options on this front.

Several app researchers have uncovered mock-ups for Twitter Coins in the back-end of the app.

Via Twitter coins, users would be able to make donations to creators in the app, through on-profile tipping, but beyond that, Twitter’s also exploring options like unlockable tweets, paywalled video, and more, as it seeks to embed broader usage and adoption of in-app payments.

A big opportunity also exists to facilitate remittance, or sending money to family and friends, which is a key use case in many regions. Remittance payment services often charge processing fees, and various social apps have been trying to find new ways to facilitate such without the same costs, with the idea being that once people are moving their money in-app, they’ll then be more likely to spend it in the same place.

Thus far, social platforms that do offer payments haven’t been able to embed this as a use case – but maybe, with Musk’s experience, knowledge and connections, he might be able to make this work in tweets.

Elon, of course, got his start in payments, with his first company, an online bank called X.com, being bought out by PayPal in 1999, his first big business win. And while his focus has since shifted to electric cars and rockets, Musk has keen understanding of the digital payments space, and how it can be adapted for varied usage.

According to reports, Musk told Twitter investors in May last year, that his aim was to see Twitter bring in about $1.3 billion in payment revenues by 2028.

That would give the company a sorely needed boost. After Musk’s cost-cutting efforts, which have resulted in the reduction of around 70% of Twitter staff, the company could be on track to potentially break even this year, or close, but a lot has to go right to get the platform back on track. And with advertisers continuing to back away from Twitter spend, it’s not looking good, while subscriptions to Twitter Blue are unlikely to provide much relief, at least at this stage.

As such, the shift into payments can’t come fast enough, though it’ll still be some time before we see the possibility of in-app payments.

Also, while Musk has made it clear fiat currency will be the main focus of this push in its initial phase, cryptocurrencies could also, eventually, be included. The price of Dogecoin, Musk’s favorite crypto offering, rose to a 24-hour high after news broke of Elon’s expanded payments plan.

Will payments be the answer to Twitter’s revenue woes? Maybe, if Elon’s vision for billions in payments revenue comes to fruition – and with his previous track record, you can’t dismiss the notion entirely.

But it’ll take time, many approvals, and many more steps before we reach the next stage.

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