Russia, Facebook and the T-Shirt Salesman

Hi, Adam Satariano from London. Reading about the way Russian propagandists are using Facebook’s advertising platform to spread misinformation and sow political discord got me thinking about T-shirts.

Bear with me here.

In the little corner of the web economy for selling T-shirts through Facebook, success has little to do with clever design, and much more to do with mastering the social network’s ad-targeting tools. Like politics, the key is reaching exactly the right person who likes your idea. Think of the T-shirts, “Keep Calm, I’m an Engineer,” “Keep Calm, I’m a Rugby Mom” and so on.

The way T-shirts are sold on Facebook gives a glimpse of how its ads can be used to reach people vulnerable to fake news, or messages that exploit political divisions. While the ends are clearly different, the methods are very similar. Mark Zuckerberg speaks of Facebook bringing people together, but the company’s advertising business is unbelievably profitable because it slices users into narrow segments.

For a tutorial, I called Benny Hsu, a 40-year-old internet merchant based in Jacksonville, Florida. Since 2013, he’s been making about $700,000 a year selling T-shirts, jewelry and other trinkets with the help of laser-focused Facebook ads.

“Facebook has so much data on everybody,” said Hsu, who spends about $15,000 to $30,000 on Facebook ads each month. “We can really drill down as narrow as we want to go.” He targets by income level, gender, hometown and age, before filtering further by purchase history, pages “liked,” and groups joined. “You can target people by college degree, how many kids do they have, are they new parents, do they have a teenager. You can target people who have gotten engaged in the past six months or just been married. You can do it by religious beliefs, and ethnicity.”

Hsu brings up the national anthem controversy. Designing shirts based on breaking news can boost sales. “That's a trend that you can capitalize on by making shirts for people on both sides,” he says. Those opposed to kneeling are more eager buyers, he said. One shirt featuring a picture of the American flag with “I Don’t Kneel” written underneath sold well, Hsu says.

To advertise the “I Don’t Kneel” shirt, he targeted people in groups supportive of gun rights such as “Gun Owners of America,” because they are more likely to back Donald Trump. He also advertised to followers of the Facebook page of a T-shirt seller who only offers Second Amendments designs. “Gun rights is an audience that buys T-shirts,” he says. Some of it is trial and error, and Hsu had mixed success targeting various conservative political groups. Facebook’s algorithm works some magic here as well. When a person buys one of Hsu’s shirts, the company’s system will comb through data of its 2 billion users and steer his ad to other people with similar profiles.

“They track behavior, they know what you're clicking on, what articles you're reading, how long you're spending viewing things,” he says. “It's a little bit creepy, but they are just really trying to help advertisers get their product out to the right people.”

As we’re now learning, some of those running ad campaigns were most interested in undermining the 2016 election. According to the New York Times, Russians targeted gun-rights groups with messages on Facebook. The Washington Post found that operatives had set up web sites and social-media pages to identify voters vulnerable to propaganda, and then sought them out with Facebook ads. According to CNN, Russia-linked ads targeted voters in swing states like Wisconsin and Michigan. Investigators are now combing through thousands of social-media ads in an attempt to fully understand the scope of Russia’s election interference.

Hsu hasn’t been tracking the controversy closely, but after years working inside Facebook’s system he’s not surprised the tools are being gamed. “That's what's so powerful about Facebook advertising,” he says. “You can use it for just about any goal that you want.”

If investigators are looking for a crash course in Facebook advertising, they could do worse than calling Hsu for a lesson.

Sign up to receive the Fully Charged newsletter in your inbox, and follow Bloomberg Technology on Twitter and Facebook for more.

And here’s what you need to know in global technology news

Is this the beginning of the end of Uber drama? The ride-hailing company will move forward with a major investment deal from SoftBank  and approved governance reforms that will limit the influence of co-founder Travis Kalanick and early backers. Just days ago, Kalanick stunned his successor and other investors by appointing two directors without consulting the board. 

Google’s turn now. The probe by U.S. lawmakers into Russian influence on last year’s elections is now targeting Google’s YouTube and Gmail. The Senate has called the search giant to testify on Nov. 1, along with executives from Facebook and Twitter.

Basically, it was every Yahoo user. The web company disclosed that all 3 billion of its users had their accounts compromised ina 2013 hack. But now, that’s Verizon’s problem, as it operates Yahoo with plans to combine it with its AOL business. 

The Tesla Model 3 delays aren’t causing too much angst. The electric automaker’s investors shrugged off news of early manufacturing bottlenecks for the $35,000 sedan. 

    Before it's here, it's on the Bloomberg Terminal.