As illustrated by a research study published earlier this month by the PNAS, with a dataset of over 58,000 volunteers, Facebook is able to reveal a lot about its users based on their respective likes and habits. Private traits and attributes, such as sexual orientation, intelligence, gender, likeliness of using addictive substances and even happiness, can be predicted with fair accuracy.
What's more, Facebook is gearing up to leverage this type of advantage.
As far back as September, Facebook was introducing tools, like its custom audiences tool, to help advertisers reach customers with relevant ads. By February, that tool was expanded to include third-party marketing companies. Also, Facebook recently upped the ante even further, buying the campaign measurement and management software Atlas Advertiser Suite from Microsoft (MSFT).
This acquisition lets Facebook give advertisers a more holistic view of what is working and what isn't by specific demographic variables. This is key because, a campaign measurement and management tool like Atlas will let advertisers better leverage the demographics they need; now Facebook could let advertisers target their products to certain individuals based on specific demographics and what they like. It can also provide detailed information as to how effective the demographics and likes selected by the advertiser really are.Also, Facebook recently redesigned its News Feed to remove the clutter and potentially generate even more revenue from ads. But, Facebook isn't just focusing on advertisers. It is also coming up with ways for its users to access and benefit from the information it collects. launched Graph Search, which is a search system that allows users to search their map or "graph" of relationships to make it easy to find, say, friends with whom you went to college who also happen to live within 50 miles of you. Then there are Facebook Gifts -- which is basically a way for friends to select better gifts for each other by leveraging all that information Facebook collects. This may not seem like much of an advantage when buying a present from your best friend, but wouldn't it be nice to know which department store your aunt likes most or what your nephew likes to do in his spare time? Sure you could creep their Facebook pages, but especially in the case of the nephew, he might have that information locked down. Granted, Facebook Gifts won't give you that specific information, but it points you in the right direction. All in all, Facebook seems to be on the right track. The only thing left to do is find that opportune spot to hop on board.
--Written by Renee Butler in Seattle, WA At the time of publication the author had no position in any of the stocks mentioned. Follow @ReneeAnnButler This article was written by an independent contributor, separate from TheStreet's regular news coverage.
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