Apple released its long-anticipated iOS 14.5 update on Monday, April 26, 2021.¹ It trumpeted the release as a triumph for the user and their privacy over the interests of bad actors in the advertising industry. Facebook fired back, denouncing the update as punishing to small businesses and free internet services. In reality, the update is impactful but not quite as dramatic as all that. We’ll explore what it means and how businesses can navigate the new waters we all find ourselves in.
Bottom line? Your advertising strategy will be affected.
You’ll have some new rail guards in place when it comes to advertising for your business, though your on-site analytics should be unaffected. This means some targeting won’t be as accurate as it once was, and some advertising costs are expected to rise. If you have a particularly complicated tracking and conversion setup, you may need to spend some extra time scaling it back and prioritizing your goals.
For most businesses, the change really boils down to this. Before the update, advertising could be targeted to most potential customers based on their whole web experience, and their interests were more clearly defined. Now, this type of advertising will be less accurate for mobile users, since sharing data between properties will be cut down significantly. Your business may need to experiment a bit more with your targeting to find the right balance, which means your results may not be as predictable for a little while.
Meet your stalkers: the fuzzy picture advertisers took through your window.
This author recently took a look at Google’s handy overview² of assumptions on my own character, and I have to tell you, I was a little disappointed! For all the years that Google has been collecting data on me, there were quite a few errors. Several of the interests were accurate, as you might expect, though many more were completely irrelevant. Of the key demographic data Google identifies (age, gender, income, homeownership, education, industry, parental status), only my gender, parental status, and industry were accurate. I’m sorry for all the advertisers out there who paid $0.003³ for my impressions, thinking I was a highly paid homeowner with a master’s degree - you were misled. Considering I currently have what appears to be thousands of cookies stored in my browser,⁴ I might have expected a little better.
Google and other companies use this collection of information to target ads; ads that fund most of the experiences we see on the web.⁵ If you’re using something for free, advertising is probably paying for it. When it works well, you get almost serendipitous ads served to you for things you actually want. Advertising networks use aggregated information on thousands, or even millions, of users to guess who they should show a particular product to.
So it’s not so much that Google thinks I’m a highly paid homeowner with a master’s degree, but that my behaviour has been similar to people with those attributes and, therefore, I may be interested in the same things. With its most recent update, Apple has taken issue not with this practise as a whole but with how and from where that information has been aggregated.⁶
The new reality: App Tracking Transparency.
Apple’s new update directly targets apps that share user data with other properties.⁷ This means that any of the data collected by that app itself or by its owned and operated companies is still fair game - Facebook is free to use data from Facebook, WhatsApp, and Instagram to target its users. However, if an app, such as Facebook, wants to share its data with other companies or use data from user behaviour across the web, it now has to ask your permission to do so. The permission will come in the form of a prompt, similar to what you’re used to seeing for notifications or other requested permissions on your phone. In addition to the prompt, Apple has released what it refers to as “nutrition labels” - a digestible data handling scorecard viewable in the App Store.⁸
Apple has painted a frightening picture of data brokers packaging your data together until it's uniquely identifiable and using fingerprinting technology to follow you everywhere.⁹ This does happen, but the advertising industry’s concern is that in its effort to stop the bad actors, Apple is punishing the good ones too. Facebook points out that small businesses rely on personalized ads, otherwise they could not compete with larger advertisers.¹⁰ This is also true - the picture of their users that Google and Facebook sell to their advertisers, already fuzzy, is about to get fuzzier. Apple, though, is standing by its program, saying it is prioritizing the user and their right to privacy by giving them a choice in how their data is collected and used. Most advertisers believe that users’ choice will be a resounding “no thanks”.¹¹
Marketers should adjust quickly to the new changes.
First, you’ll need to expect some differences in tracking and reporting for your advertising. Cookie lengths will be shorter, user data will be more limited. This trend has been ongoing for some time: more than a quarter of users are already invisible to all tracking.¹² This will become more pronounced. Advertising networks like Facebook and Google will need some time to adjust their targeting methods or certain ads. You may end up paying more for your clicks - though this hasn’t been established yet.
If you need more advice on how to manage your company’s online presence, take a look at our report on digital ethics and social media.
For particulars, Facebook has published a handy guide to make sure you stay within the lines.¹³ Conversion tracking is still possible, but if you’re tracking more than 8 different conversion events, you’ll need to trim that back. If you have an app, use this opportunity to evaluate what information you collect from your users, how much of it is necessary, and how you handle that data once collected. You need to offer the prompt if you use third party data, but add a “permission primer” screen beforehand to explain why you need this data and what value it provides. Some advertisers are considering investing more in the influencer model, with the idea that followers of a certain influencer will be more likely to purchase their products than others.
Google is already moving away from third party tracking and is working on alternatives for advertisers.¹⁴ Apple has been working on it’s SKAdNetwork, their alternative to conversion tracking that allows them more control over their users’ data.¹⁵ Expect more of this - the restrictions may foster new solutions in the future and perhaps the fuzzy picture taken through your window will be a clearer, though simpler, one you provide yourself.
Cited
Hay Newman, Lily (2021, April 26). The New iOS Update Lets You Stop Ads From Tracking You—So Do It. Retrieved from https://www.wired.com/story/ios-app-tracking-transparency-advertising/
Google Ad Settings. Retrieved from https://adssettings.google.com/
AdStage Team (2018). Google Display Ads CPM, CPC, & CTR Benchmarks in Q1 2018. Retrieved from https://blog.adstage.io/google-display-ads-cpm-cpc-ctr-benchmarks-in-q1-2018
Chrome Site Data. Retrieved from chrome://settings/siteData
Zuckerman, Ethan (2014, August 14). The Internet's Original Sin. Retrieved from https://www.theatlantic.com/technology/archive/2014/08/advertising-is-the-internets-original-sin/376041/
Apple Privacy. Retrieved from https://www.apple.com/ca/privacy/
Austin, Patrick Lucas (2021, April 13). Retrieved from https://time.com/5954259/apple-iphone-software-update-data-privacy-control/
Campbell, Ian Carlos (2020, November 5). Retrieved from https://www.theverge.com/2020/11/5/21551926/apple-privacy-developers-nutrition-labels-app-store-ios-14
Apple (2021, April). A Day in the Life of Your Data. Retrieved from https://www.apple.com/ca/privacy/docs/A_Day_in_the_Life_of_Your_Data.pd
Levy, Dan (2020, December 16). Speaking Up for Small Businesses. Retrieved from https://about.fb.com/news/2020/12/speaking-up-for-small-businesses/
Brill, Gal (2020, October 28). The untold story about zeroed IDFAs on iOS 14 devices. Retrieved from https://www.appsflyer.com/blog/zeroed-idfa-ios-14/
Statista Research Department (2021, January 14). Ad blocking user penetration rate in the United States from 2014 to 2021. Retrieved from https://www.statista.com/statistics/804008/ad-blocking-reach-usage-us/
Facebook Business Help Center. How the Apple iOS 14 Release May Affect Your Ads and Reporting. Retrieved from https://www.facebook.com/business/help/331612538028890?id=428636648170202
Sluis, Sarah (2020, January 14). Google Chrome Will Drop Third-Party Cookies In 2 Years. Retrieved from https://www.adexchanger.com/online-advertising/google-chrome-will-drop-third-party-cookies-in-2-years/
Apple Developer Documentation. SKAdNetwork. Retrieved from https://developer.apple.com/documentation/storekit/skadnetwork