Appocalypse not now: the latest on Apple's delay to major user tracking changes
Apple is launching its new iOS 14 update this month - but has delayed a major change to its ID For Advertisers system that had the industry fearing 80% of targeted advertising on iPhones would be wiped out.
- Under proposed changes to ID for Advertisers (IDFA), all apps on the App Store would have to use explicit wording from Apple asking existing and new users if they wish to be tracked across apps and around the web, and spell out precisely what and how data is used for tracking
- Polls suggested it could wipe out more than 80% of targeted advertising on iPhones
- It would also have a major impact on the marketing supply chain as IDFA is used to track consumers across third party websites and other apps and is widely used within measurement and attribution, retargeting and data partnerships
- Industry was aghast. Sixteen large and well known marketing/advertising associations (some backed by Facebook and Google) penned an open letter to Tim Cook about the change
- Facebook warned developers the changes would torpedo app ad revenues and said it may not even offer Audience Network on iOS 14 as the changes “would render it so ineffective … that it may not make sense to offer it.”
So why the about-turn from Apple? I canvassed knee-deep-in-data-international tech execs from Bank of America, Beeswax, MoPub and the Narrative.io data marketplace on Twitter. Locally, I also asked Joey Nguyen from Ventifact and Nick from Nick Barnett Consulting.
Before we get to their thoughts, some local context: Apple's changes could mean an iOS streaming TV app, such as Stan, or Go, or Kayo, even the government funded ABC iView app, cannot get the data they need to hit subscription targets, analyse product quality or increase in-app ad revenue. Yet Apple could use that same data to boost its own TV streaming app. It could also use it to raise incremental revenue from non-Apple apps by making them spend more on App Store advertising. Quite some advantage. And that is just TV apps. The likes of PayPal and Alipay, will also be concerned. Indeed, as will anyone looking to create a crypto-currency iPhone app or payment SDK (Square, Braintree, etc.) that competes with ApplePay - but sits within iPhone apps.
Now for the views of the tech execs:
- Perhaps Apple has realised that it’s not an adtech business and didn't understand all of the nuanced challenges and impacts the IDFA change would make. It is giving the industry (and itself) time to consider/adapt to the changes.
- Ventifact’s Joey Nguyen hopes Apple is “taking onboard suggestions to improve SKAdNetwork [its attribution solution] and turn it into something beyond its current barebones iteration."
- Beeswax's founder Ari Paparo seconds that view: "While the tech of SKAd were understood", Ari commented, "the mechanics of how all the parties were supposed to interact were very confusing and rushed. Giving us all another couple of months is welcome."
- Lou Paskalis, Vice President, Customer Engagement for Bank of America, is another ‘good Apple’ proponent: "I think this is a rare recognition by Apple that they are not the ecosystem but rather a part of it. Publisher economics are so brittle now that the outcome of this migration needs to create an economic advantage for them if they are to survive the migration, and that is by no means clear as of yet."
- Apple already faces investigations by lawmakers and regulators for various reasons (e.g. Fortnite, slowing down older iPhones etc.)
- The letter from the IAB and others, plus Facebook explicitly stating this move from Apple would hurt its ad business. Apple doesn’t need more antitrust right now
- Ditto suggestions that this is the start of an 'advertising power move' by Apple, limiting the amount of data others can collect and use, making it harder for others to compete
- Pointed questions about Apple’s ‘privacy’ motives: its own data collection practices for advertising defaults to ‘opted in’ for ad usage, yet it is forcing all other apps to be opted out
- As Nick Jordan from Narrative.io put it: "It means that all Apple cares about is their bottom line, and all the privacy stuff is a smokescreen".
What to consider in the next few months
"If proposed changes are so disruptive that Apple needed to delay them, it should be a strong indication that you need to take this seriously and get a plan in place ASAP if it is not on your radar today,” said Ventifact’s Nyugen.
According to Nick Barnett, formerly head of media and tech for Westpac, everyone should be aware that campaigns running across mobile apps on Apple devices currently use the IDFA, and the IDFA is going away. The kind of tactics that have made digital campaigns seemingly so efficient is also, therefore, going away.
"Good brand marketers, will not use click and conversion metrics too literally, and they do not overvalue 'silver bullet' tactics like hyper-targeting using IDFA data or cookie-bombing," he explained.
"They (client marketers) will already be measuring the impact of broader online and offline marketing activities, so the IDFA changes most certainly won't be as devastating for them."
Twitter-owned MoPub's American MD Anand Ramesh pointed out that while most focus has been on performance ads and lower funnel acquisition, "upper funnel buys for brands will also see material impacts".
He urged brands that use the upper funnel to use the stay of execution to better prepare.
"[The] the simplest example is that most brands operate off allow lists. Opt-in rates [ergo audience] will look very different by app."
"Brands," he says, "will really need to rethink that allow list."
Given that most brands with apps will need to implement an opt-in to collect IDFA, he believes it might break a critical hook into CRM systems. Brands must therefore test out their tech stacks in preparation for Apple’s changes.
Whatever reasoning Apple had for this 12 month IDFA stay of execution, we should 100% be using it wisely. To do so, you and your team should follow @loupas, @aripap, @anandramesh & @nick_jordan from this thread.You should also follow @ericseufert, whom I did not quote in this article. Yet he’s managed to be in every other article on the internet about IDFA depreciation, so he gets an honorary shout-out.
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