MARK301-How Social Media Sites help in Advertising

Business intelligence and data mining 1
Targeted Advertising in Social Media Sites
Assignment
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Business intelligence and data mining 2
Introduction
Social media websites have revolutionised advertising by introducing a new paradigm that
interacts with the consumers directly. In itself, social media allows businesses to reach
consumers based on their preferences and immediate needs. However, the most critical aspect
of this platform is the customer targeting programs that are usually done, where users are
provided with products based on their setting and browser history. This outcome is now a
common phenomenon notwithstanding the previous targeting methods that followed the
user’s ‘Likes’. In this context, the ‘Likes’ refers to the buttons used on social media sites such
as Facebook where a user will show his/her sentiments based on the given criteria. Now, in
the past, these buttons were hosted on various websites and when used would serve as a
preference setting while using the social media site1. Today, this process has gone a notch
higher to include retargeting methods that will use customer’s browser history and settings to
promote products and services on social media sites. This process is achieved using ad
exchange systems and affixing tracking Softwares as discussed below.
Ad exchange
This method of advertising follows the spaces provided by the multiple online publishers who
provide space inventory to advertisers based on an automatic bid system. This method
replaces the traditional method of negotiating for space based on a one-on-one interaction. In
essence, companies such as social media sites (e.g. Facebook) will avail space on their
platforms which other companies will automatically bid for based on programmatic
advertising method that is supplied by DSPs (Demand Side Platform)2. Now, programmatic
1 C. Delo, Facebook to Use Web Browsing History For Ad Targeting, Advertising Age, 2014,
Available from: http://adage.com/article/digital/facebook-web-browsing-history-ad-
targeting/293656/ [Accessed 15 August, 2017]
2 G. Marvin, Martech Landscape: What Is An Ad Exchange? Martech Today, 2016, Available
at: https://martechtoday.com/martech-landscape-what-is-an-ad-exchange-161947 [Accessed
15 August, 2017]