Apple Changes the Way Digital Advertising is Played
Last month, Apple rolled out their new AppTracking Transparency policies with the iOS 14 .5 update. Companies like Facebook fought the move. But we think Apple’s policies are here to stay and are likely the wave of the future. Digital Advertising will never be the same. But not to worry, we’ve got this. The sky isn’t falling, it’s just changing colour.
What is the Apple AppTracking Transparency framework?
Apple’s new AppTracking Transparency framework forces apps to request a user’s permission to track them and to access their device’s advertising identifier. Unless someone gives permission, the advertiser identifier will remain at 0. So, a user will get a message to the effect of:
Do you want to allow this app to track your activity across other companies’ apps and websites?
And a user will be able to answer yes or no. Some developers have now added a pop-up before the permission screen which attempts to sway people as to the benefits for them to say yes (more personalized ads). There are no studies as yet as to how successful this tactic has been but there is data regarding how many people are opting out of tracking and it’s significant.
Why is Apple implementing these new privacy policies?
It’s probably best to let Apple explain this one itself:
“Privacy is a fundamental human right. At Apple, it’s also one of our core values. Your devices are important to so many parts of your life. What you share from those experiences, and who you share it with, should be up to you. We design Apple products to protect your privacy and give you control over your information. It’s not always easy. But that’s the kind of innovation we believe in.”
How will it impact digital advertising?
Apple’s AppTracking Transparency Framework will definitely impact data collection, reducing visibility into how ads drive conversions as well as how advertisers value ad impressions. It will also change the ability for digital advertising to target and retarget on an individual level, based on what people clicked on and viewed previously. For years now, companies have assigned your device an ID and then they monitor your behaviour across the web and on different platforms, so as to generate demographic info and understand purchasing habits, and ultimately, sell that information to advertisers who deliver personalized advertising to you. The AppTracking Transparency framework disrupts this process, at least for users of Apple apps, but, we think this is the way the world is moving, and companies like Google will also end up doing the same thing.
Companies like Facebook and Google will not be able to provide their advertisers with as accurate targeting as they would like (although they may have a way around this, for example, by monitoring people based on email addresses or other such identifiers). As well, Apple doesn’t stop companies from monitoring users within their own properties, so for example, Facebook could monitor people within Facebook, Messenger and Instagram, but it requires them to ask permission to monitor people when they visit other companies’ properties.
At the very least, it will make users aware of how much they’re being monitored and by whom, and perhaps it’ll make those same companies re-think if monitoring is necessary if they have to ask permission. There have been quite a few controversies recently when people realize that an app a company pushed them into downloading and using to say, order coffee, turned out to be monitoring them online and even offline in ways they hadn’t expected.
It’s estimated that about 10% to 15% of users will opt-in, but a preliminary study has shown that the opt-in rate is even worse than expected, with 96% of people opting out of being tracked.
How are companies like Google complying?
To compensate for issues of measurement, Apple introduced the SKAdNetwork, which makes performance data available at the campaign level. It’s not a perfect solution. For example, a company is limited to how many campaigns they can monitor. According to Harvard Business Review, the “SKAdNetwork falls within the sphere of differential privacy, an approach to marketing measurement that uses statistical methods to make it impossible to infer any individual user’s behaviour while still allowing linking of behaviour across different digital properties.”
Google has introduced SKAdNetwork and encourages ad developers to upgrade to version 7.64 of the Google Mobile Ads SKD for features like SkAD network support. They are giving Apple feedback on how to further improve the SKAdNetwork so their advertisers get accurate campaign results. They do recommend that app advertisers implement the latest version of Google Analytics for Firebase as well.
What steps is SearchWarrant taking to meet this challenge?
Most of our client programs use first-party data and are less reliant on audiences built by app-based tracking, so we don’t anticipate a dramatic impact in your results. You may notice a drop in reported website and offline conversions because of the tracking disruptions. We do recommend that you take advantage of Google’s new innovations that will help with the measurement of iOS 14 traffic, including implementing a new URL parameter with a global site tag. We’ll be implementing (or helping our clients to implement) this new item.
For online advertising, depending on the goals and history of our clients, we’ll enable audience expansion for remarketing or customer match campaigns to target based on similar audiences we’ve targeted in the past. We’ll also closely monitor the performance and delivery of companies serving iOS traffic and if necessary we will make adjustments to budgets. There may come a time in which we’ll have to pay higher prices for audiences that consent to tracking, but for now, that time has not come. Moving forward, AI will play a larger role in building audiences too..
At the end of the day, privacy policies are here to stay and it’s for the best. For Chrome, Google followed Apple’s lead and phased out third-party cookies, and it’s likely that they will also continue on the journey of more privacy controls. Digital advertising companies and app developers will have to sell consumers on the benefits of being tracked such as the delivery of personalized advertising, but if most consumers feel that being tracked around the web or offline is too high a price to pay then digital advertising will adjust. Between AI and the fact that digital marketers should already be experts at persuasion, the sky isn’t falling for us, the weather is just changing.
Whatever the future holds though, SearchWarrant will help our clients brave the new frontier. Contact us today.