How Facebook Makes Money

Summer Hirst | Last Updated On: May 23, 2019 | No Comments

Ever wondered how Facebook makes money? Facebook is a great platform that provides a lot of entertainment for free. But what exactly is the price for “free?” As you might know, Facebook is a self-sustained ecosystem of its own. When you congratulate someone for their promotion or wedding or when you ping a friend to meet up, you make connections on Facebook. And Facebook knows about these connections and uses them for its own gain.

How Facebook Makes Money

Facebook gets profits by digital adverts. The company earns billions of dollars each quarter. While Google ads are mostly based on keyword related searches, Facebook adverts are highly targeted. Facebook has a lot of personal data about each user. It lets the advertisers use this data to create custom demographics and show ads relevant to each user group. Marketers can create custom groups based on features such as religion, political affiliation, and sexual orientation.

When you interact with a story – for example, when you press the like button on a post – that data goes to Facebook. The more posts you like of that page, the more visibility that page gains on your newsfeed. The Facebook algorithm is pretty accurate. With this algorithm, advertisers can create a complete profile of you – whether you’re a woman who loves traveling or a man who is into comics – Facebook knows everything about you and uses this data for its advertising business.

How Facebook Uses Your Profile

When you like a page, it shows up on your friend’s feed as an ad. This is a subtle way to convert your likes into adverts. If you interact with that ad, you will see more of these ads. When you add a major life event on Facebook such as getting engaged or married, you’ll see targeted ads such as those related to wedding products or honeymoon packages. So basically, depending on your lifestyle, you’ll see ads that relate to you.

Not Interacting At All?

Even if you don’t like, share, or comment on any pages or adverts, your profile still has a lot of information about you, such as your location and age. Combine this with information from your friends, and Facebook will know a lot about you. So no matter how much invisible you try to be, you will still get pretty accurate ads on Facebook.

How to Stay Hidden

You can change your advertisement preferences on Facebook. Click here to go to Advert Preferences. You can provide Facebook with more information about your likes and dislikes or opt out of some of the ad services. However, Facebook will still collect your data.

Another thing you can do to hide your information is logging out of Facebook after using it. If you keep it open while you browse for other information, it can collect your search data for its own purpose.

When you use a new service, it generally gives you an option to sign in using Facebook. Many people take this option because it is simpler and takes fewer clicks. However, when you use Facebook to sign into another service, Facebook gets your information. So whenever you register to another service, make sure you complete the steps manually. This might take a few seconds extra but will keep your information hidden from Facebook.

Disabling Facebook

You might want to delete your Facebook account to stay safe, but Facebook will still retain some data about you. It’s almost impossible to hide your digital footprint. If you’re worried about your security, it’s best not to get on this social media giant in the first place.

That said, you might want to connect to your friends and loved ones using Facebook. Disabling Facebook might not be something you would want to do. To maintain a low-key profile, make sure you interact less with pages and ads. This way, while Facebook will have some information about you, it will not know you completely and you will be able to keep your profile safe with your details hidden from the others.