Acxiom, the Little Rock-based tech company that sells individual user data to marketers, is seeing its stock plunge this morning after Facebook announced it would no longer use such “third-party data aggregators.” Acxiom stock had lost about 1/3 of its value as of mid-morning Thursday.
On Wednesday, Facebook said it would stop using companies such as Acxiom to provide additional data to Facebook’s clients for the purpose of targeted advertising. The tech news site Recode explains:
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Facebook previously let advertisers target people using data from a number of sources:
*Data from Facebook, which the company collects from user activity and profiles.
*Data from the advertiser itself, like customer emails they’ve collected on their own.
*Data from third-party services like Experian [and Acxiom], which can collect offline data such as purchasing activity, that Facebook uses to help supplement its own data set. When marketers use this data to target ads on Facebook, the social giant gives some of the ad money from that sale to the data provider.
Facebook said it would be shutting down the third category to better protect individual privacy. In the wake of the Cambridge Analytica scandal, the social media giant is facing pressure over its freewheeling use of personal user data to sell ads.
Recode and others note that third-party data aggregators weren’t involved in what Cambridge Analytica did.
UPDATE 3:51 p.m.: Acxiom recovered a portion of its morning losses Thursday afternoon. As of Thursday afternoon, shares in the company were off by about 20 percent.