All the stuff you post about yourself and what you like in Facebook or some other social network is a marketer’s wet dream. Data mining companies are now capitalizing on the free information you post about yourself, mining it, and then selling statistically significant data relationships to marketers via the social network’s APIs.
A company called Colligent mines social networks for data that it sells to record labels to help them decide which demographics or individual fans might like a particular artist, and those are just the very first nuggets marketers pull out of profiles.
This monitoring of publicly-available data has already paid dividends. Disney's Hollywood Records label had noticed more Latin American fans at Jonas Brothers concerts than it expected to see, but until Colligent's data revealed a statistically significant correlation between that band and the Latin American community, it hadn't capitalized on that observation. Data from social networks convinced them to increase their marketing budget in Latin American communities, and when the next Jonas Brothers album came out, Nagarajan says, the label saw a significant uptick in sales to Latin Americans.
There's a lesson here: If you want to participate in social networks and interact with free content online, there's a clear privacy trade-off. In a way, it's a fair deal: we get free data in the form of social networks and free entertainment, while marketers get free data about who we are â€” and what we can't resist. By: Eliot Van Buskirk
The best piece of advice is NOT to use social networks if you want to maintain your privacy.