Kevin Stecko is the founder and president of  He's been operating the business since December of 1999.

Facebook and Cambridge Analytica

As an advertiser on Facebook my interest in the Cambridge Analytica kerfuffle is focused in two areas.  The first is concern that people will stop using Facebook and the channel will become less effective.  The second is trying to discover if there is a better way to advertise on Facebook that I'm not currently using. 

On a personal level I own some Facebook stock which I would like to increase in value.  

So my bias is to want Facebook to come out shining and smelling clean.  Despite that I am trying to think critically about this and not let my bias affect my thoughts.  Which I will outline below:

Thoughts as an investor

My belief is that this will blow over.  The average person does not care about this as much as the media.  The media hates Facebook because Facebook has taken advertising dollars that used to go to newspapers and tv and radio stations.  Heck media websites don't make money because it's hard for advertisers to profit from buying banner ads.  So Facebook is seen as an enemy.  But the average person is going to get bored of this story, and in fact I think the average person never thought much about it in the first place.  

It seems that the people most inclined to care about this are people who really dislike Trump.  The question is do many of these people stop using the Facebook app or website?  I'm betting that the answer is no, mainly because so far there hasn't really been any compelling evidence of how the Cambridge Analytica data was used.  I'll talk about this later.

Thoughts as an advertiser

I spend hundreds of thousands of dollars on Facebook every year.  I don't think of myself as a "good advertiser", though, because Facebook is an amazing platform.  Facebook gives everyone that uses it incredible tools for finding people that are similar to customers or site visitors. 

We use lookalike audiences of people who have purchased our products.  It's really simple.  We upload a list of the people who've made a purchase, and Facebook finds people who are similar to that list.  The magic happens behind the scenes because Facebook has tons of data about everyone that uses the app and website. 

Because they have so much data they are really good at finding people similar to a list of people.  In fact Facebook could probably find people who are so similar to you that it would creep you out.  And here's where the Cambridge Analytica claims don't hold water.  I just don't see how having access to a set of data that is old and tiny compared to what Facebook has could allow someone to target better than the native tools Facebook uses.  I will certainly update this if I learn that there are some secret tools that others have access to that I do not. 

To put this another way, if someone came to me and said that using data from 2015 they could do better on Facebook than I can without their help I would not buy what they are selling.  If anything I think this shows that the campaigns that used this data hired people who made inflated claims.


This is not going to be a death blow to Facebook.  If you can pick up some stock at $155 I think you'll be happy you did so in a year.  There's a good chance you'd be happy in 6 months.  Because if Facebook comes out of this with healthy profits that proves how strong of a company they are, and in my mind reduces the risk premium for owning the stock.  


Facebook has some maturing to do in public relations and in user data management.   They would be advised to take a less hands off approach to the advertisements they allow on the platform.

They also need to make sure political advertisements get cleaned up, mainly because the losing party will always have reason to come after them.  It just so happens that the loser party is D this year.  If the situation were reversed the R party would find something they don't like.  So this is both a partisan issue but also a non-partisan issue because there's always a loser.


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