Finally, Apple dropped the bombshell that it will be making its IDFA effectively useless as of iOS 14 to be released in September 2020. The news from Apple’s WWDC on June 22nd was expected from some people in the industry. Apple has already addressed online tracking with ITP (Intelligent Tracking Prevention) that limits companies’ abilities to track users on their Safari browser. This was coming and inevitable and now means that Apple will have control over access to personal information in-app and web.
The app install business is estimated to be worth $80 billion, growing to $120 billion in 2022 according to Appsflyer. The problem is that iOS represents a large share of this market and the planned changes are going to have a significant impact based on the information we know today.
Apple has introduced an explicit opt-in box for apps that want to get access to the user's IDFA and track them for advertising purposes. Once a user has confirmed their choice this will be applied to the app across all devices: mobile, tablet and Apple TV. As far as is understood, the user can only ever be asked once for permission and it will be down to the app developer to decide when it is best to do that.
Impact on the global app install space
Developers will have to use the new AppTrackingTransparency framework if they want to get access to the IDFA and ask for user permission to track them. Users will be presented with something similar to the box below and developers will be able to customise some of the text in their bid to convince the user to opt-in.
Apple says in its documentation: “Developers need to use the AppTrackingTransparency if the app collects data about end users and shares it with other companies for the purpose of tracking users across apps and sites.”.
Today, iOS users can opt-out of being tracked by enabling the Limit Ad Tracking (LAT) feature which can be found under Settings > Privacy > Advertising. For users that have enabled Limit Ad Tracking, a “LAT = 1” flag would be passed to Adtech platforms so that they know to ignore that user as without IDFA, performance cannot be measured. Also, Apple sends the IDFA as zero’s.
It is estimated that over 30% of users have now enabled Limit Ad Tracking according to Singular. Considering that users need to navigate three levels down into the iOS menu, that number may appear to be on the high side. That’s not surprising given the increasing heightened awareness about consumer data privacy and tracking by the big internet companies.
A number of industry commentators have guesstimated that opt-in rates for users to explicitly give permission in IOS14 for tracking will be between 10-20%. That number effectively kills IDFA as a mechanism for iOS app install tracking and attribution, impacting an entire value chain that has been built around MAIDs (Mobile Advertising IDs): user tracking, marketing measurement, attribution, ad targeting, ad monetization, device graphs, retargeting and audiences.
The obvious and fundamental shift here is that Apple is moving the opt-in from a general level setting on the device where a user can make changes whenever to an explicit one-time only opt-in on an app-by-app basis. For iOS 14, this means that while a user may have opted in on one or more apps that they particularly trust, they may have denied permission for tracking purposes on all other apps. This is messy fragmentation.
Aside from app install attribution, this will impact other useful features commonly used in programmatic advertising: cohort reporting, frequency capping and estimating unique audience reach.
- Device fingerprinting: This is the obvious solution but it’s not clear if this will be acceptable by Apple.
- SKAdNetwork: Apple has proposed an update to the SKAdNetwork framework.
Apple may have offered the app install space a possible way forward using its SKAdNetwork framework used for measuring the success of ad campaigns and attribution while maintaining user privacy. The ad networks must register with Apple and developers must configure their apps to work with the ad networks.
When a user clicks on an ad there is a redirect to the App Store and basic information such as Network, Publisher and Campaign ID are passed. When the app is successfully installed the App Store will respond with a conversion postback to the Ad Network containing AdNetwork ID, Campaign ID, Conversion Value but no device ID. The whole process is controlled and managed by the App Store.
What about in-app monetization
Apple’s changes will have an impact for iOS apps where users have not given their explicit permission to be tracked. How it will impact is still unknown and hard to estimate, but it's fair to say that developers will notice a change in their monetisation KPIs and the types of ads being delivered. For example, CPMs are very likely to be lower and the ads displayed will not be reliant on IDFA.
App developers will need to update their iOS SDK to support iOS 14, implement the AppTrackingTransparency framework and SKAdNetwork API and register with their ad networks.
Fyber has already released a contextual ad targeting solution for the post IDFA era that provides DSPs with additional privacy-friendly data points for targeting and optimization purposes.
Other monetisation options that are app developer centric could be to explore capturing other unique identifiers in the app such as email or the introduction of more in-app payments of subscription services to compensate for possible decrease in revenue due to iOS14.
What we don’t know
- Impact on Self-Attributing networks: There are many self-reporting ad networks including Facebook, Google, Twitter and Snapchat. These ad networks receive data from the MMPs and they then define their own methodologies which are often skewed towards their own interests.
- Impact on non-Self-Attributing networks (e.g. most DSPs): Apple refers to “ad network” in its documentation with no specific reference to programmatic advertising. .
- What’s the role of the MMPs (Mobile Measurement Platforms) if any? Could they fulfill the Ad Network role in the chain?
- Ad fraud? This was previously possible because data was shared, now that data sharing is limited how will existing ad fraud solutions operate?
- The SKAdNetwork will provide minimal data back to the ad network and there will be a delay. No user or device data will be sent back. The limitations and the impact here need to be fully understood.
- What will happen to the many features that once relied on MAID’s (user targeting, device graphs, retargeting, frequency capping, unique audience reach etc.)
- Can we rule out fingerprinting completely yet?
Advertiser’s won’t stop spending, however, there are still many unknowns and limitations with Apple’s plans that the industry needs to get it head around fast and work out how they move forward.
Many questions need to be answered, but we will have to wait until September when iOS 14 is released and Apple clarifies how the industry will be able to operate.
The big elephant in the room now is what action will Google take following Apple’s decision and when is that likely to happen.
One final thought, given the industry hires tens of thousands of people worldwide, Apple could have been a little bit more considerate given Covid-19 and put this off until 2021. This will impact people, jobs, livelihoods, app development and much more. Who knows, maybe Apple will read this paragraph and change their minds. We will see.