Tracking shifts send shockwaves through social media stocks

Last year, Apple drew a line in the sand regarding its stance on consumer privacy regarding ad tracking. Earlier this year, several Silicon Valley powerhouses felt the repercussions on Wall Street.

Share’s of Meta, Facebook’s recently renamed parent company, saw its market cap drop by more than a quarter in late January. The 26 percent drop was its biggest one day drop in company history. The company’s stock price has remained stunted since.

Other social media based tech companies saw price dips too, but not at the scale of Meta. Shares in Twitter, Pinterest and Snap all fell following their Q4 earnings reports but have mostly recovered in the time since. 

Meta’s stock skid illustrates the ongoing battle between tech conglomerates over how to police data, privacy and consumer protection across the internet.

For Facebook, these developments may signal an overhaul of its ad business.

People can’t really be targeted the way they were before,” said Eric Seufert, a media strategist told the New York Times. “That breaks the model. It’s not just an inconvenience that can be fixed with a couple of tweaks. It requires rebuilding the foundation of the business.” 

As Seufert also pointed out to the Times, additional repercussions are being felt by advertisers and consumers alike in the form of higher prices.

Facebook CPMs in particular have seen spikes across nearly every vertical since Apple’s iPhone update. And as a majority of users have opted out (more than 75 percent)  of the more invasive tracking, data pools have decreased and demand has gone up.

Facebook’s battle has actually buoyed the ad business elsewhere, as Google and other demand side platforms that aren’t as reliant on Apple’s data have seen spikes across channels outside of social media.

Want more help in navigating user tracking, ad channel selection and how to more efficiently spend digital advertising dollars? We’re here to help, get in touch.


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