There have been no losses in advertising spends on Facebook following the Cambridge Analytica controversy and advertising budgets on the platform from clients remain unaffected, said Sandeep Bhushan, director, India and South Asia at Facebook in an interview to ET.
“There is absolutely no loss at all in advertising. We have clearly said we are making changes both on privacy and on the larger area of how there is content on the platform. We have been pretty vocal about it. We know the impact of the Cambridge Analytica incident on users in India has been fairly low,” said Bhushan, referring to around 5.62 lakh users in India that had been impacted by the data leaks.
“So, consumers are aware they have not been impacted They also know we are acting now to make sure they are not impacted in the future. Advertisers continue to see tremendous value and know there is no material consumer difference on the platform.
So, we are in a good space. There is no doubt that there is work for us to do. We have made significant changes in the area of apps for instance. Consumers are aware of the changes and businesses are confident. So, no immediate effect. In fact, things should get better. We expect a 30% growth on advertising on digital platforms in general and there is no reason for Facebook to be behind that for sure,” he added.
Facebook has also partnered with KPMG in a first of its kind ‘Zero Friction Future’ programme to launch a series of whitepapers on reducing friction in purchase patterns across sectors for the first time starting with the smartphone industry. Bhushan said Facebook will share these studies with companies going forward and the reports may lead to changes in its own advertising tools and products in future.
The whitepapers are based on the primary research and insights survey conducted by Nielsen and are aimed at helping marketers understand why consumers abandon purchase journeys and what brands can do to provide a seamless personalised experience to convert better.
“The fact that our business continues to grow 40-50 % year on year despite the scale of a $ 50 billion turnover company is because we are able to deliver the returns on investments to our clients. We know our customers and their business well. We are doing this (Zero friction future programme) so that we get to build products around the challenges that we are able to see. And most importantly be their partners in solving problems.
We are going after understanding multiple categories this year in India. Smartphone, is the first one but we will move to consumer goods, travel, and fashion going forward. Friction is a term we are using to describe places where consumers do not get what they want to in their purchase journey,” said Bhushan.
The first report titled ‘Eliminating Friction in Smartphone Path to Purchase’, highlights that friction accounts for approximately two-thirds of consumer dropouts while buying smartphones and media friction contributes to approximately one-third of the dropouts in India.
The study also noted that mobile influence will continue to dominate the smartphone purchase journeys as 7 in 10 smartphone purchases will be mobile-influenced by 2022. As per the report, friction faced by consumers can be reduced with the higher use of mobile in the media mix and this can create $3.1 billion worth of potential revenue for smartphone brands by 2022.
Mobile phones influence 58% of smartphone purchase decisions, amounting to $ 8.5 billion worth of sales and the share is expected to reach 73% and influence $15.6 billion worth of sales by 2022.
Currently, Facebook influences 33% of purchase decisions concerning smartphones amounting to $4.8 billion worth of sales and the share of the platform is expected to grow to reach 44% and influence $9.5 billion worth of sales by 2022.
Bhushan said the bulk of Facebook’s advertising in India is using simple demographic targeting. “We do core demographic variables and that is not impacted. The other big used case for Facebook in India is custom audience.
Custom audience means you know your users, you are able to find them on Facebook and that data is entirely yours. That used case also stays unimpacted. There is no conflict between a greater need for privacy and targeted advertising which is very relevant.” he said.