iOS 14: Reducing IDFAs
Over the past decade, digital adoption has accelerated rampantly with categories like smart phone adoption increasing over 130%, and tablet adoption increasing over 2,000%. The Internet of Things (IoT) continues to generate wearables and smart homes are on the rise. The digital world is melding more seamlessly with the physical world than ever before. As such, there’s more data than ever on consumers which is projected to grow to from 49 zettabytes in 2020 to 149zb in 2024 (1zb = 1 billion terabytes).
What’s lost in this rapid expansion is how data is being used, and most critically, how it’s being regulated. As we’ve become accustom to living our digital lives, thinking about privacy and security are starting to catch up to us and we’ve seen major steps in protecting and giving consumers power and control over what data is collected and how it’s used (GDPR, CCPA, etc.).
Industry titans have vested interest in how data is leveraged, and privacy evolves. The latest change is being prompted by Apple with new security and privacy measures in the roll out of iOS14. As with any change, the implications are often unclear, but based on what we know, there are meaningful ripples across the industry that will affect the way that we plan, buy and measure media impact.
What is an IDFA?
The Identifier for Advertisers (IDFA) is a random device ID assigned by Apple to each user’s iOS device. Each device’s key is unique, and these keys are used by developers to identify that device without requiring users to provide personally identifiable information (PII). Advertisers use these IDs to track users who interact with in-app ads and track installs. This also allows advertisers to personalize mobile targeting. As of December, iOS has a 61% share of the mobile device market, and Android has 39%.
Apple is implementing a change to app tracking in the release of iOS 14 (early 2021) in a continuation of efforts to protect consumer privacy and data security. The new update will require every app to get explicit permission from the user before tracking them or accessing their device’s advertising identifier (IDFA) or any other identifier used for advertising purposes. To gain permission, a pop-up (Apple has named it “Apple’s App Tracking Transparency (ATT)” prompt) will appear upon opening each app (similar to the website cookie notifications people receive since GDPR rolled out). It will ask the user if they would like to allow tracking or if they would like to ask the app not to track (opt-out). This prompt is somewhat customizable, however in order to continue to collect the end user’s IDFA the user must opt-in. If the user does not opt-in, the device appears to have no identity, and in-app targeting and tracking of attribution and conversion events is disabled. Note: this prompt will only appear if LAT (the setting to disable tracking) is not already enabled on the device level.
Why is This Happening?
This all falls in line with Apple’s continued commitment to transparency and privacy. People are waking up to the value of their data, and implementing these policies helps build trust. We saw this when Apple developed ITP (Intelligence Tracking Prevention) regulations for their browser, discontinuing 3rd party cookies and restricting 1st party cookies. Additionally, opting out has been a feature on iOS devices for years, it’s just being brought to the forefront.
How Will This Impact Advertising?
In short: the observable universe of people for targeting, measurement, and optimization is going to be smaller. ~70% of iOS users share their IDFA with app publishers, after this change it is estimated that this number will drop to 10-15%, but time will tell. The significant decrease of available IDFAs (IDs), will challenge our ability to perform activities such as frequency capping, audience segmentation, ad targeting, measurement, attribution, and optimization. Mobile app advertising campaign efficiencies are bound to suffer with the inability to optimize based on these critical data points. App publishers will likely see a large decrease in revenues due to the impact on their entire business model and have their creativity tested thinking of ways to incentivize users to opt-in. Apple’s update impacts all online ad companies, but our most affected channels will be programmatic, and Facebook/Instagram given their investment levels.
How is Programmatic Affected?
The Trade Desk has an immediate set of solutions to help us weather the storm, and even recoup some of the shrunken universe we have been left with. This involves targeting users who have decided to remain opted-in and keeping track of iOS users by separating them out in our bidding process. Since ID matching will no longer be a capability for those who opt-out, we will utilize TTD’s probabilistic modeling and AI technology in place. While probabilistic modeling is less precise than ID matching, enabling it will help us to continue providing user and device-level data. Still, successful modeling relies upon a solid foundation of data, and data is what’s being eliminated. It will become more difficult to track, measure, target, and optimize as robustly as we have in the past, and we should therefore be prepared to narrow our scope, prioritize the collection of first party data, and deploy contextual targeting strategies.
How Are Facebook and Instagram Affected?
Facebook and Instagram rely heavily on user engagement information to do things like report on actions or purchases from ads, create remarketing, etc. Therefore, the new explicit prompt asking users if they want to disallow tracking will likely have a significant decrease on their collected data.
How is Facebook Responding?
- Statistical Models: Similar to TTD, Facebook will use models to try and make up for the lost data. Conversion windows will only have partial reporting. When modeled data is used, annotation will highlight that observed results have been extrapolated.
- The 8 Conversion Limit: Advertisers will be limited to 8 conversion events, such as button clicks or “thank you” page loads, tracked per domain. This could be 8 pixel-based events, or 8 custom conversions.
- The 8 conversion events will be ranked based on priority when it comes to reporting. This means that if you have both “Add to Cart” and “Purchase” as 2 of those 8 events and a user does both actions, only the higher prioritized metric will be recorded (“Purchase”).
- If and when an advertiser changes one of the events, there will be a 3-day hold until they can run campaigns against the new event. This allows for a day of attribution, and 1-2 days of delay to ensure reporting attributes correctly
- Domain-Based Pixel Ownership: Facebook pixels used to be created and assigned to ad accounts, but they will now be tied to a verified domain
- Attribution: Attribution windows are being trimmed to shorter timeframes which will have the impact of recording fewer conversions than the longer 28-day window. The below table, provided by Facebook details the changes:
What Other Platforms Will Be Affected?
- Snapchat, Twitter & Pinterest: Likely integrating with Apple’s SKAD network, and will therefore face the aforementioned loss in granularity of data
- Google: While Google has not yet stated plans to remove device ID’s from androids, Google has been following behind Apple’s ITP regulation in the removal of 3rd party cookies from Chrome, so it wouldn’t be surprising if at some point they adopt this policy too
What is Apple Suggesting in Lieu of IDFAs?
Apple’s only provided alternative (SKAdNetwork) exclusively focuses on providing measurement for ad app installs. This will not provide assistance with non-app related conversions. Furthermore, if used for a mobile app install campaign, the conversions will be reported in aggregate meaning no user data or device data will be received, and a certain threshold of app installs needs to occur in order to keep privacy intact (this “threshold” is unknown at this time, however should be considered if running an app install campaign for small/niche apps that may not result in high volume install conversions).
What Comes Next?
From GDPR, to CCPA, to ITP, to the dissolving of cookies, there is perpetual change within the industry and you can count on KSM to keep abreast of these changes and the impact that they will have on your business and campaigns. We work closely with our media, measurement, and technology partners to understand their moves and by extension how we have to set up, manage and report on campaigns that maintains as much targetability and tracking as possible. Considering the immediate and pending changes that come with the latest iOS 14 update, there are a few strategies to keep in mind:
- Prioritize first party data for targeting: First party data is of known quality and is proven useful. Applying first party data for targeting is a great way to insulate against potentially shrinking targetable audience pools.
- Consider contextual targeting: If skittish about 3rd party data’s reduced scale potential, consider contextual targeting as a stopgap measure.
- Historic results are still useful: Remember that yesterday’s performance norms still carry weight and just because a partner like Facebook will report fewer conversions does not mean it is necessarily less impactful.
- Embrace new solutions: Partners like TTD are offering solves like probabilistic matching that re-expand the targetable universe, we expect more media partners to follow.
- Refine conversion tagging: The iOS14 changes drastically impact conversion reporting so be on the lookout for recommendations on tagging schemas for Facebook specifically.