Meta announced some important changes for users in the EU, following continued pressure from regulators. Changes include lowering the cost of the ad-free subscription to launching “Less Personalized Ads.”
Let’s discuss…
Meta’s Announcement
Here’s what Meta said about “less personalized ads”:
Over the coming weeks, people in the EU who choose to use Facebook and Instagram for free with ads will be able to choose to see ‘less personalized ads.’ This less personalized ads option relies on less data…
Meta says that these ads will be based on a “minimal set of data points including a person’s age, location, gender, and how a person engages with ads.”
Meta says that if users choose to see less personalized ads, “it may result in ads that are less relevant to a person’s interests. That means people will see ads that they don’t find as interesting.”
Meta’s Bad Bet
Meta originally created the ad-free subscription model for users in the EU because the company believed it would satisfy regulators. This, Meta believed, would give users two options:
1. Use Facebook and Instagram with ads powered by their data
2. Pay to remove ads and their data won’t be used for advertising
But the regulators weren’t buying it. Now Meta has been forced to slash the price of the subscription (twice) while now offering this “less personalized ads” option. It would appear that Meta made the decision on the subscription prematurely, and now they’re paying for it.
Impact to Advertisers
Understand that the impact to advertisers isn’t about removing targeting inputs. I’ve seen reactions that this isn’t a big deal because advertisers have success going broad and using limited inputs anyway. But, this impacts the data points that META can use to deliver ads.
Advertisers should watch this closely. How many users will sign up for less personalized ads? I’ve seen reports that Meta is not hiding this option — users are getting prompted to make a choice. How will it impact performance?
Now that it’s happened in the EU, it sets a precedent. We could see this implemented elsewhere as well. And that could be bad.
