Recently, we posted an Insights article chronicling this fight between Apple and Facebook over IDFA, a privacy framework created by Apple that allows apps and marketers to track device activity at the user level. IDFA-tracked data provides advertisers like Facebook with deep visibility into user behavior, allowing them to tailor ad delivery to users on Apple mobile devices using a wide range of targeting parameters.
While IDFA has been in use for some time and app developers have been able to access it by default, new changes in the recently released iOS 14 mean Apple mobile device users will now receive an in-app prompt called AppTrackingTransparency (ATT), asking them whether they would like to allow that app’s developers to access IDFA-tracked data.
The ATT prompt marks the first time users will be opted out of IDFA tracking by default. Even if they opt in via the prompt, an estimated 20% of Apple device users will still not be able to grant advertisers access to their IDFA due to other privacy settings, notably the Limit Ad Tracking (LAT) feature (LAT is a separate setting in Apple mobile devices that effectively opts users out of sharing their IDFA with any app on that device, and supersedes individual ATT prompts if users attempt to opt in.) The inevitable drop-off in users opting into IDFA tracking will leave Facebook with severely reduced access to a bevy of user data that feeds its algorithm and helps it determine how to serve ads to billions of users daily.
When Apple first announced the ATT prompt, Facebook warned that the new privacy setting would devastate advertisers’ abilities to effectively target users on Apple mobile devices (Apple smartphones, for context, command 40% of market share across all smartphones in the United States.) Facebook also cited internal research saying small business owners earned, on average, 60% less in sales revenue when denied access to data that IDFA opt-outs will block.
Initially, Facebook made several announcements about their intent to comply with the iOS 14 policy, including:
In response to harsh criticism from Facebook, Apple initially pushed back the rollout timeline for the ATT prompt to “early 2021”. Last week, however, Facebook released a statement acknowledging that while they consider the ATT prompt damaging to advertisers, they have “no choice but to show [Apple’s] prompt”. The same statement goes on to explain Facebook’s expectations for how ATT will impact different users of their ad platform.
iOS 14 users that opt in will still be trackable via Facebook’s ad interface, and Facebook will continue offering advertisers the ability to target those users in most standard campaigns. While conversion tracking will be negatively impacted, Facebook’s willingness to keep that functionality intact is a shift toward a more flexible approach to Apple’s impending changes.
Short-term, there will be some marginal benefits for marketers. They will at least be able to target some iOS 14 users, although we don’t yet know how large the opt-in group will be. Long-term, the likely trajectory seems unchanged – Apple (among other companies, governmental bodies, etc.) will continue to press ahead with increasingly stringent privacy standards, and Facebook will be forced to adapt.
Facebook marketers should expect a marked decline in the effectiveness of marketing to iOS 14 mobile users. We anticipate the fallout will broadly mean:
In September, we hypothesized that Facebook’s acquiescence suggested that they were forfeiting on this particular issue and would look for other solutions. Facing large declines in publisher revenue, Facebook is shifting strategy from a full retreat (no participation) to a partial retreat (accepting ATT prompt in-app). Taking their case to the court of public opinion, including full page newspaper advertisements and a blog post entitled “Speaking Up for Small Businesses,” is unlikely to meaningfully change the trajectory of their ongoing struggle with Apple.
With this in mind, our guidance from our September piece still holds. Marketers need to prepare for reduced in-platform measurement capabilities on Facebook and explore alternative measurement solutions.
We are again recommending that all our clients who advertise on Facebook:
Marketers using more specific targeting and optimization options on Facebook will face issues as well. Our marketers, using Facebook-provided guidance and drawing on their own expertise, have identified several use cases that may apply to your Facebook marketing program:
Your pixel may only optimize for a maximum of 8 conversion events for each domain. Previously, there was no cap on the number of events that can be optimized to. Facebook will initially configure the conversion events they believe are the most relevant to your business based on your activity. In advance of this limitation, consider if changes will need to be made to your campaign or measurement strategy.
Questions about how your Facebook marketing program will be impacted? We’re ready to take a look and help you understand how to be prepared as these changes take effect. Reach out to your New Engen account director today to learn more.