For a company that once shied away from pelting its users with ads, Facebook has become very, very good at delivering personalized advertisements in your news feed. It's why something as benign as a four-pack of undies you were browsing on Amazon can relentlessly follow you into your Facebook stream, retargeting you again and again.
That kind of technology is not very smart on its own, mind you. But it is about to feel a lot smarter. Starting soon, Facebook will use app and website usage data to help advertisers deliver even more finely tailored ads. You might not be familiar with the term "interest-based advertising," but it's become the ad-delivery method du jour for companies like Google.
Basically, it combines in-network data (what you do on a site like Facebook) with stuff you do on other websites. Facebook is essentially taking all that internal and external passive data, rolling it together, and using it to shape the way it sells you goods in the future. Here's how Facebook explains it:
Let's say that you’re thinking about buying a new TV, and you start researching TVs on the web and in mobile apps. We may show you ads for deals on a TV to help you get the best price or other brands to consider. And because we think you're interested in electronics, we may show you ads for other electronics in the future, like speakers or a game console to go with your new TV.
That will undoubtedly feel creepy for some users; it is perfectly reasonable people don't want to feel like they're being followed around on the web. That said, you can opt out of having these kinds of ads in your web browser altogether. (You can learn how to do that here.)
Facebook, however, says it is introducing a new ad preferences option for every ad in your feed. Basically, all that is is a drop-down menu on every ad that lets you pick from options like "I don't want to see this" or "this ad is useful."
Last quarter, Facebook easily beat Wall Street projections. Its Q1 2014 earnings showed $2.5 billion in revenue, with ad revenue up 84% from the previous year.