A unified computer database that gathers and refines information on millions of potential voters is at the forefront of campaign technology – and could be the key to an Obama win

Barack Obama's re-election team are building a vast digital data operation that for the first time combines a unified database on millions of Americans with the power of Facebook to target individual voters to a degree never achieved before.

Digital analysts predict this will be the first election cycle in which Facebook could become a dominant political force. The social media giant has grown exponentially since the last presidential election, rendering it for the first time a major campaigning tool that has the potential to transform friendship into a political weapon.

Facebook is also being seen as a source of invaluable data on voters. The re-election team, Obama for America, will be inviting its supporters to log on to the campaign website via Facebook, thus allowing the campaign to access their personal data and add it to the central data store – the largest, most detailed and potentially most powerful in the history of political campaigns. If 2008 was all about social media, 2012 is destined to become the "data election".

"Facebook is now ubiquitous," says Dan Siroker, a former Google digital analyst who joined Obama's campaign in 2008 and now runs his own San Francisco-based analytics consultancy, Optimizely. "Whichever candidate uses Facebook the most effectively could win the war."

For the past nine months a crack team of some of America's top data wonks has occupied an entire floor of the Prudential building in Chicago devising a digital campaign from the bottom up. The team draws much of its style and inspiration from the corporate sector, with its driving ambition to create a vote-garnering machine that is smooth, unobtrusive and ruthlessly efficient.

Already more than 100 geeks, some recruited at top-flight university job fairs including Stanford, are assembled in the Prudential drawn from an array of disciplines: statisticians, predictive modellers, data mining experts, mathematicians, software engineers, bloggers, internet advertising experts and online organisers.

At the core is a single beating heart – a unified computer database that gathers and refines information on millions of committed and potential Obama voters. The database will allow staff and volunteers at all levels of the campaign – from the top strategists answering directly to Obama's campaign manager Jim Messina to the lowliest canvasser on the doorsteps of Ohio – to unlock knowledge about individual voters and use it to target personalised messages that they hope will mobilise voters where it counts most.

Every time an individual volunteers to help out – for instance by offering to host a fundraising party for the president – he or she will be asked to log onto the re-election website with their Facebook credentials. That in turn will engage Facebook Connect, the digital interface that shares a user's personal information with a third party.

Consciously or otherwise, the individual volunteer will be injecting all the information they store publicly on their Facebook page – home location, date of birth, interests and, crucially, network of friends – directly into the central Obama database.

"If you log in with Facebook, now the campaign has connected you with all your relationships," a digital campaign organiser who has worked on behalf of Obama says.

The potential benefits of the strategy can already be felt. The Obama campaign this year has attracted about 1.3 million donors, 98% of whom have contributed $250 or less – that's more than double the number at the same stage in 2008. At this rate, Obama is also well on the way towards staging the world's first billion-dollar campaign.

Under its motto "Bigger, better, 2012", the Chicago team intends between now and election day in November to create a campaign powerhouse which will allow fundraisers, advertisers and state and local organisers to draw from the same data source.

Joe Rospars, the campaign's chief digital strategist, told a seminar at the Guardian-sponsored Social Media Week that the aim was to create technology that encourages voters to get involved, in tune with Obama's emphasis on community organising.

Campaign insiders say that the emphasis this year will be on efficiency more than any headline-grabbing technical wizardry. But that should not obscure how significant this year's presidential cycle will be in putting to the test the first custom-made digital campaign.

Mark Sullivan, founder of Voter Activation Network, which manages the Democratic party's central database of voter information known as Vote Builder, says that "what we will see in 2012 will make 2008 look really primitive".

Judith Freeman of New Organizing Institute, who worked on both John Kerry's 2004 and Obama's 2008 presidential campaigns, says there is a leap forward in technology every presidential cycle, and 2012 would be no exception. "There's a deadline – it's got to be done by election day – and that provides a huge push to make things happen."

In 2008 the Obama digital team was lauded around the world for its groundbreaking work on internet fundraising. Yet in fact, the separation of its data on voters into several distinct silos forced high-level staffers to spend hours manually downloading information from one database to another.

The Obama team in 2008 did a good job in beginning to tear down those walls, releasing extraordinary fundraising energy in the process that raised about $500m online.

This year the Chicago team hasn't knocked down the walls so much as dispensed with them altogether. They have built from the ground up a unified database that incorporates and connects everything the campaign knows about a voter within it.

Rospars said that in 2012 they no longer had to try to integrate data in the campaign. "We are just one campaign now – we built it from scratch."

The centralised nature of the database may raise privacy issues as the election cycle progresses. Jeff Chester of the digital advertising watchdog Center for Digital Democracy, which has been calling for regulators to review the growth of digital marketing in politics, said that "this is beyond J Edgar Hoover's dream. In its rush to exploit the power of digital data to win re-election, the Obama campaign appears to be ignoring the ethical and moral implications."

But from the vantage point of the campaign the benefits are evident.

"Fusing your data into one central store is cheaper, quicker and allows you to be more targeted," said Jim Pugh, who was part of Obama's 2008 digital team and now works for the progressive online movement, Rebuild the Dream.

The Obama database incorporates Vote Builder, a store of essential information such as age, postal address, occupation and voting history drawn from the voter files of 190 million active voters. It lines up and matches those voter files with data gathered from online interactions with the president's supporters – notably the millions of pieces of information its army of canvassers collected across the nation during the 2008 race, a list of email addresses of supporters that it has amassed and that now stands at about 23 million, as well as the contact information of Obama's 25 million Facebook fans.

Facebook itself has been transformed as a political campaign tool since 2008, simply by dint of its exponential growth. Four years ago there were about 40 million Facebook users in the US; now there are more than 160 million – incorporating almost the entire voting public.

The significance of the fusion of Facebook and voter file data is hard to overemphasise. "This is the Moneyball moment for politics," says Sam Graham-Felsen, Obama's chief blogger in 2008. "If you can figure out how to leverage the power of friendship, that opens up incredible possibilities."

First among those possibilities is that the campaign can distribute customised content designed specifically for its Facebook fans to share with their much wider circle of friends. The messages can be honed to a particular demographic – age, gender, etc – as well as set of interests, and targeted on the most hotly contested parts of the most crucial battleground states.

"Influencers" – those people who tend to act as thought leaders among their friends on Facebook – can be identified and prioritised.

Teddy Goff, the digital director of the re-election team, told Social Media Week that as the year progresses there would be more and more "persuasion through interaction".

Individual voters would be given access to digital platforms from which they will be able to tell their own stories "and that's far more powerful than anything we can say", Goff said. "That will be the story of this election. People's own stories really moves votes."

Goff said the campaign was focused on building relationships through social media. An Obama message would be crafted so that "not only can it be passed to your friends but to those friends that we think are most in need of passing it on to".

The bottom line is that if you are sent a message from your Facebook friend encouraging you to turn up to an event or donate to Obama, you are vastly more likely to respond than if the request comes from an anonymous campaign staffer.

The other door that data integration will further open in 2012 is personalised marketing. This has been the Holy Grail of political campaigners for decades: the idea that you can talk directly to voters and serve them customised messages.

In the old world of snail mail, that could be achieved to some degree through direct marketing – ie leaflets dropped into the letter box – but that is expensive and far too slow with today's 24-hour news cycle.

The fusion of information into a centralised database allows you to direct market online at much less cost and virtually instantaneously.

The technique has begun to spread widely among commercial businesses over the past year, and it is only a matter of time before such hyper-targeting is standard across political campaigns. Indeed, we've already started to see it this year.

The Obama campaign has already tailored a single donation request to 26 distinct segments of the voting public. The Republicans are also getting in on the act.

Michele Bachmann used customised online advertising in Iowa to reach Republican voters only, sending to their computers messages with a local spin for each of the state's 99 counties. That helped her win Iowa's vaunted straw poll in August 2011 (though that didn't help her in the long run). Rick Perry sent God-praising commercials to Iowans who listed themselves as evangelicals on Facebook.

The company CampaignGrid, that serves mainly Republican candidates, claims to be able to online market direct to targeted households. It has an integrated database on 110 million voters across America – some 65% of the electorate – to whom it can serve personalised ads, following them wherever they are browsing on the internet.

Jeff Dittus, the company's co-founder, illustrates what this means. He worked on behalf of one unidentified Republican presidential candidate, serving online ads in the Miami-Dade region of Florida specifically to 400,000 individuals who had voted in at least two of the four previous Republican primaries. The adverts were further customised for gender, and for Spanish speaking.

They were distributed to the individuals through internet ad exchanges that allow for instantaneous filtering of users the nanosecond they click onto a video on any one of four million websites. In that flash, if you fitted the criterion you were served with a 30-second pre-roll video from the candidate delivering a message to you that you would have found remarkably personal.

"I'm sure this is the future of digital political campaigning," said CampaignGrid's CEO Jeff Dittus.

Drew Brighton, CEO of TargetSmart Communications, is hoping to do the same hyper-targeting for Democratic and progressive politicians and causes through his new product Target Blue. It matches up the details of up to 50m cookies embedded on individual computers with voter files and uses it to identify Democratic-leaning individuals to whom it can serve customised ads wherever they go on the web.

The company is also developing a system for targeting Democratic voters through their computer IP addresses down to such tightly drawn areas or "IP zones" as just 20 households. That allows for micro-targeting depending on the average income bracket, age profile and concerns of that tiny locality.

The elephant in the room, of course, is television, which continues to dominate advertising spending by political campaigns. Most analysts agree that 2012 has come too soon for any equally transformative leaps forward in targeted or "addressable" TV advertising.

Cable television can close in on geographic zones ranging from a few thousand to up to 100,000 viewers allowing campaigns to shape their messages to those clusters. The tighter the geographical area that can be drawn, the more efficient the TV advertising becomes as campaign managers can focus on primarily-Democratic, Republican or independent neighbourhoods.

But its still a relatively blunt instrument. The prize would be to be able to fuse cable subscriptions with voter files so that TV adverts could be sent to households of a specific political persuasion.

Technically, that's already possible. Comcast Spotlight, the advertising arm of Comcast Cable, has run trials of commercial as opposed to political addressable advertising in Baltimore. Adverts custom-made to speak to various demographic groups were piped into 60,000 identified households, though the personal details were removed to protect privacy. The results confirmed the power of the technology: homes receiving addressable adverts tuned away a third less of the time than homes receiving untargeted commercials.

Dan Sinagoga, who specialises in political advertising at Comcast Spotlight, says that all advertisers, but political ones in particular, "would like to be doing addressable advertising yesterday". But he said it was unlikely to happen in any great quantity in 2012 as there are too many hurdles, including concerns in Washington about the privacy of cable TV consumers.

No such impediment will hold back the digital explosion this year. As an Obama insider puts it: "Give us less wood, and we'll make more fire."