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POV: APPLE IOS14, FACEBOOK & IMPACTS ON MEDIA

Insights / 02.09.2021
Red Door /

WHAT IS THE APPLE IOS14 UPDATE? 

In September 2020, Apple announced sweeping changes to its mobile operating system, iOS 14. Expected to launch soon (reportedly sometime in early 2021), the update includes a variety of data and privacy changes, but most notable is Apple’s decision to require mobile apps to ask users for permission to collect and share data using Apple’s device identifier. Rather than the traditional “opt-out” option for data collection, users will now have to “opt-in” to data tracking on each website or app. ​ 

FIRST, SOME HISTORY TO SET THE STAGE 

To this point, Apple has used iPhone Identifiers for Advertisers (IDFA) to assign a random number to each device. Apps reference these numbers to tie together user activity and behavior to target users. In the past, IDFAs have made it easy for marketers to create targeted ad placements and product recommendations. But with this update, IDFAs will not be applied to a device unless the user has chosen to opt-in.  

WHAT IT MEANS FOR MARKETERS 

An important aspect of free app marketplaces is the ability to collect and sell data to advertisers. If  you’re not paying for a product, you — and your data — are likely the product. And this privacy feature Apple is adding has the potential to severely weaken the ad targeting business. In short, the update is bad for hyper-targeting, but good for most users. Here are some notable implications for marketers:  

  • Apple's update potentially impacts ad effectiveness and limitations on ad measurement for advertisers. 

  • If we assume that 50% of users are iOS and 50% are android, we can expect up to 25% of the total data collected from IDFAs by platforms such as Facebook and Google will be affected. ​ 

  • When an IDFA is not present, advertisers cannot leverage a frequency cap on media. Additionally, without an IDFA, advertisers cannot segment or target users behaviorally, making it even more of a challenge to show users relevant ads.​ 

  • If you are only using IDFA, you won’t be able to retarget ads to users who visited your website from an iOS 14 device. Facebook and Google have other identifiers, such as email addresses and phone numbers, that can help to identify devices when an IDFA is not available.​ 

  • Data that includes demographic breakdowns for app installs will be unavailable and any reporting surrounding app installs will be delayed 24-48 hours. 

TACTICAL IMPLICATIONS FOR ADVERTISERS 

With changes of this scale to a pillar of ad tracking for a whole category of mobile devices, there will be a wide-range of potential impacts. Possibilities include the following: 

  • Conversion reporting, especially in Facebook, will now be reported at the time of conversion, not the time of ad interaction and it will be aggregated at the campaign level. This shift to time-of-conversion reporting will have varying degrees of impact. Facebook suggests metrics like cost-per-conversion will see small fluctuations. However, the degree to which metrics shift will be highly dependent upon the campaign objective and audience. Longer gaps between spend and conversion will have an exponential, negative impact on the reliability of spend efficiency metrics. ​ 

  • Campaign optimization will be less agile, requiring longer periods (of less efficient spend) to reach statistical significance and eliminate date-offset bias when comparing campaign performance.​ We recommend conversion modeling to determine conversion predictors, and tracking solutions that can reduce bias presented by the offset of spend and conversion data.​ 

RECOMMENDED NEXT STEPS 

  • Prepare to verify domains  to operate with a maximum of 8 pixel events per  domain  based on your business objectives in Facebook. When verifying domains it's important to  rank the  top 8 events that are relevant. Events  left unranked will stop collecting  data.​ How domains are structured matters. CCTLDs such as example.com, example.de, example.ca, etc. will get 8 events each. However, sites that use directories to separate out country versions (example.com/fr, example.com/uk, etc.) will get 8 events total.  

  • Capturing user emails whenever possible is one way around the removal of IDFA, at least for platforms where data can be joined. On your website, when user emails are known, these can be hashed and sent within the Facebook pixel. Facebook can then join this data to provide similar targeted advertising without reliance on IDFA. ​ 

  • Implement conversion modeling, as noted earlier, to miti​gate some aspects of this change. In light of these shifts, we also expect the growing trend towards “incrementality” over traditional attribution modeling will accelerate.  

  • Facebook has asked advertisers promoting their own mobile application to update their app with Facebook's SDK (Software Development Kit) for iOS 14 and to utilize the Facebook SDK API to further help personalize ads to users with an iOS 14 device. This will also allow for advertisers to review how many leads or purchases come directly from iOS.​ 

  • It is important to know that the SKAD (StoreKit Ad Network) window will not have an attribution window and will, instead, be "last-click".​ 

WHAT’S NEXT? 

With limited understanding of exactly how things will be impacted, we will be updating this post as more information becomes available to us. Still not sure what this update means for your media efforts? Reach out! We’re here to help navigate the impacts and determine the appropriate platform updates required for your media program. 

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