Could Apple’s iOS 14 Update Cripple Your Facebook Ads? Here’s What It Means For Your Brand
Since Apple’s announcement in June that it would soon require apps to ask for permission to track their users’ data, many people in the advertising world have made doom and gloom predictions for what it means for the future of digital marketing, and particularly how it will impact advertising on Facebook’s family of apps.
Fortunately, as you will soon see, the impacts of Apple’s latest update are not expected to be as significant as imagined by much of the marketing community.
TL;DR: While there may be some gaps in data and other small inconveniences, Facebook has already built workarounds to ensure advertisers can track and report on key actions that consumers take. The ad platform will likely see a small drop off in efficacy, but it will continue to be one of the most powerful customer acquisition tools available to brands.
Read on for a deep dive into what the iOS 14 update is, why it matters to advertisers, how it is expected to impact brands, and what you can do to maximise your chances of success with Facebook ads in 2021.
What is the iOS 14 update?
In short, iOS 14 will require all apps in the Apple App Store to display a prompt, requesting that users either opt-in or opt-out from allowing an app to collect their data and track their behaviour across the web. This App Tracking Transparency (ATT) prompt will be rolled out to users that update their Apple devices to iOS 14 early in 2021.
The update will affect the way that Apple devices identify users and report on actions that they take across apps and websites. In turn, this will impact the way apps like Facebook track users’ behaviour and report on actions that they take.
Why does it matter?
As well as measuring your behaviour within its own family of apps, Facebook tracks some other websites and apps that you use in order to understand your behaviour and serve you relevant ads. This is made possible via the Facebook Pixel – a piece of code that advertisers add to their websites and apps in order to track actions you take, such as reading content, adding items to your shopping cart, and making purchases.
With more than 2.7 billion users globally, and millions of apps and websites that have installed the Facebook Pixel, Facebook has harvested and cross-referenced billions of data points to understand a LOT about consumers based on the actions they take around the web. Facebook has combined this data with machine learning to create an advertising platform that helps businesses target those people that are most likely to be interested in their products.
On the opposite side of the coin; from a Facebook user’s point of view it means that you can be served personalised ads that are relevant to your interests.
There has been no shortage of conversation around the ethics of Facebook and its use of data in recent years, but there is no arguing that this huge amount of data has helped Facebook become one of the most powerful advertising tools ever created.
But now with the iOS 14 update, Apple will require Facebook to ask permission to track its users’ actions via the Facebook Pixel. When a user opts-out, there will be limitations for how Facebook can track and report on these actions.
Apple users make up a large chunk of customers for many businesses, so a significant percentage of businesses’ target audiences are likely to opt-out of being tracked by Facebook across the web.
It’s important to note that this will not be an opportunity for users to fully opt-out of all tracking, and actions taken within Facebook apps will still be tracked. Whenever you download and use Facebook, Instagram, or WhatsApp, and you agree to their T&Cs, you opt-in to having your in-app data processed by Facebook.
How has Facebook responded?
Facebook’s response to Apple’s announcement was heated. The company took out full page newspaper ads in major publications such as the New York Times and the Washington Journal, and even made a dedicated website to fight back against Apple.
The reason for this is that Facebook makes tens of billions of dollars each year from ads, as bewildered members of US Congress discovered when they asked Facebook CEO Mark Zuckerberg how the platform makes money back in April 2018.
“Senator, we run ads,” Zuckerberg replied with a wry smile.
Facebook’s opinion is that the update sets a precedent that will threaten the free internet, as Apple is limiting advertisers’ ability to serve personalised ads. Facebook argues that this will mean websites and apps will be forced to start charging users subscription fees, or rely on in-app purchases in order to make money, and therefore the internet will become too expensive for users and high-quality free content will be reduced.
In a nutshell, Facebook believes that less personalised ads will change the internet for the worse.
What do the changes mean for advertisers?
It’s likely that more than 50% of iOS 14 users will opt-out of having their data tracked by Facebook across the web and other apps, and this will leave gaps in the data streams that Facebook relies on to feed its algorithms.
This was a core part of the reason why the advertising community was so alarmed by Apple’s announcement. What happens when a large chunk of the data that feeds Facebook’s algorithms disappears?
The short answer is that we don’t know exactly what the impact will be just yet, but we can say that the effect is likely to be less significant than many originally feared, because Facebook has sprung into action and made a series of changes to ensure it remains compliant with Apple’s new policy.
Aggregated Event Measurement has been introduced, and while it hasn’t been publicly revealed how this will work, we do know that Facebook will be using a new algorithm to help measure campaign performance “in a way that is consistent with consumers’ decision about their data.”
In simple terms, this means Facebook will still track data but this data will be ‘randomised’ so that personal data remains private. It means that advertisers will still be able to track and optimise for conversions such as purchases, but there will be some limitations on visibility of other actions that iOS 14 users take outside of Facebook, such as viewing different pages of a website and adding products to their cart, if they’ve opted-out.
As users cannot opt-out of in-app actions, there should be no degradation in the quality of audiences built on actions within the platform such as video views, engaging with content, and saving posts etc. There should also be limited impact on interest-based targeting within the platform, and advertisers will still be able to target users via geographic location and other demographics, although they will not be able to see a breakdown of data by these segments in reports.
Ultimately then, the good news is that advertisers can still create ad campaigns optimised for events such as purchases, and the effectiveness of campaigns targeting users based on interests, geography and demographic should not be noticeably impacted.
What impacts will advertisers see?
We’re losing the 28-day attribution window, which will now default to a 7-day window. A 7-day attribution window means that conversions are only tracked and reported by Facebook if they occur within 7 days of the user clicking on an ad.
View attribution is also being reduced to one day. Up until now, if someone saw an ad on Facebook, and then Googled the brand and bought a product without clicking the original ad up to one week later, this would still have been counted as a Facebook conversion. Now it will only be attributed if the sale is made within 24 hours.
These two changes mean fewer conversions will be attributed to Facebook. This does not mean that Facebook is contributing less to your businesses performance, but fewer conversions will be attributed to Facebook than before. This will have a larger impact on businesses that have more considered products, as these are more likely to have customer journeys that take more than 7 days from the user seeing an ad to making a purchase.
Advertisers will be limited to a maximum of 8 conversion events. This should be no problem for 99% of advertisers, but any that usually track a large number of event conversions will need to narrow their focus to the ones that are most important to their business. If a user has opted-out of tracking on iOS 14, one highest-prioritised event will still be attributed to that user within the 7-day attribution window for any advertising campaign. For ecommerce brands, this will usually be the ‘purchase’ event.
There will now be a small delay in reporting due to Aggregated Event Measurement. Reporting has been almost real-time to date, but now we will likely see a 24-72 hour delay between someone taking an action and the action being reported in Facebook. This will make it very difficult to see daily performance of ad campaigns in real-time, but longer windows, such as 7-day time periods, are usually best for measuring success regardless, due to daily fluctuations.
Low quality advertisers such as dropshippers are likely to drop off the platform, which is good news for serious advertisers, and means CPMs (cost per 1,000 impressions) are likely to fall due to less ad space competition.
It is currently unclear how retargeting campaigns will be affected, but it’s likely that advertisers will see retargeting audiences reduce in size, and efficacy of retargeting campaigns may be reduced.
All things being equal, Facebook ads are likely to see a slight drop in effectiveness, but we estimate that this is likely to be a 5-10% negative impact on overall performance. It’s only affecting a chunk of overall audiences (those who have iPhones who opt-out) and even for those people, we can still track important events, just with some gaps in data.
Checklist:
Here are some preventative measures you can take to continue to advertise effectively:
Prioritise the 8 conversion events that are most important to your business.
Understand what the changes to the attribution window means for your reports, and how it will impact conversion results reported by Facebook. We suggest comparing the relationship between 28-day and 7-day attribution on your historical data so that you understand what success looks like with a 7-day window.
If you have a Shopify store, install Facebook’s conversion API.
Consider installing a post-purchase attribution survey tool to get qualitative feedback from shoppers and validate your data.
Communicate these impacts to your wider team so that key stakeholders are aware of and understand the changes to reporting.
Don’t make snap decisions around campaign performance as the update is rolled out. Remember that fewer conversions will be reported overall due to the changing attribution window, and that it will take 24-72 hours to see results appear in your Facebook reports.
Wrapping up
Hopefully this has been a reassuring read for any brand owners or advertisers who have been anxious about how iOS 14 might impact their business. Best practices will still apply once iOS 14 has been rolled out, and if you have any tactical questions around ‘will X still work post iOS 14?’ the answer is most likely yes.
As marketers, our job is to ride the waves of change, and we can sleep easy in the knowledge that Facebook is actively working hard to make sure it will continue to dominate the advertising world, and remain an incredibly valuable tool for businesses.
Google and other ad platforms are yet to respond to Apple’s announcement with any detail, so it is still unclear whether or when Google Analytics/UTMs will be affected. More changes may be coming, but it’s our feeling that GDPR was a much more significant change to the advertising world than iOS 14 will be – and it is hard to pinpoint any major ripples to advertising efficacy caused by GDPR.
