Apple’s IDFA Change: Call It Advertising Shockwave: The Prequel!
The advertising ecosystem, including brands, publishers, and DSPs, is already fretting about how they will adapt to Google’s removal of third-party cookies from Google Chrome early in 2022.
But if ad execs want a glimpse at a possible path forward, they now have a front-row seat to watch how mobile advertisers are readying for their own big change—Apple’s plan to give users the choice to block the Identifier for Advertisers (IDFA) at the app level.
Beginning with its iOS 14 update this week, Apple will require apps to ask users for permission (opt-in) to collect and share data on all Apple devices, most notably iPhones.
That’s just potentially one shoe dropping in the mobile advertising space. Google has yet to announce whether it will follow suit and make the Android Advertising ID (AAID) on Android devices opt-in as well at some point.
Because it has become so mobile-centric, how Facebook/Instagram adjusts to the lack of identifiers on Apple devices may provide a broad template for advertising on mobile devices, while also offering clues for how to execute desktop advertising once targeting becomes more challenging.
The Known Unknowns of Post-IDFA
The biggest unknown when it comes to IDFAs after the iOS 14 update is how many people will choose to opt-in and continue to allow personal identifiers on their Apple devices. Current estimates range from as low as 10% to 30% or higher.
Many assume opt-ins will be low, and Facebook is already starting to update their platforms so that they are not reliant on IDFAs or other mobile IDs.
As part of that process, Facebook has embraced Apple’s SKADNetwork, which will become the next best thing. Though far from perfect, the SKADNetwork will let social media platforms and DSPs know that an ad conversion happened, just without the device-level identifiers.
This level of detail will give Facebook and others the ability to still report overall ad effectiveness to their advertiser even if it won’t allow follow-up audience retargeting.
Facebook has also placed added emphasis on having more user activity occur within its platforms, such as Facebook Shopping or Instagram Shopping, so the consumer spends as much time as possible on the apps.
By taking this step and using other features, Facebook can still let brands use personalization and targeting in their ad outreach—as long as that user stays within the Facebook app.
Facebook is already preparing advertisers and starting to deprecate some of their metrics such as store visits for their measurement platforms—which require location-based targeting that won’t be available after the iOS 14 update—pulling that measurement from many advertiser accounts.
Publishers with a large mobile presence face different challenges but also have different tools they can use to drive opt-in. Some publishers may take a cue from large well-known news sites and provide a few articles each month for free, with full-time access requiring a first-party identifier from the user, such as an email.
That could prove effective for larger publishers with must-have content but may not be enough to keep afloat those smaller competitors lacking the scale or content to entice audience opt-ins.
The Options for Advertisers
Mobile advertisers looking to continue to engage audiences on Apple devices should already be preparing for the post-IDFA world and beyond. But many of those broad lessons will need to be applied in the post-third-party cookie desktop world soon enough.
The strategies are not identical, but both require investing in building out as much relevant first-party data on their user base now while those audience insights are still available. That means advertisers should be leaning in on multi-touch attribution to provide a benchmark to measure against going forward.
That internal data can be augmented by the host of companies providing third-party identifiers since many of those will likely have a shelf-life for a while once the IDFA becomes opt-in only.
Brand marketers also need to borrow from earlier generations of savvy advertisers and turn to modeling, either media mix modeling, volumetric modeling, or econometric modeling, to determine the effectiveness of marketing campaigns.
Modeling isn’t dependent on either cookies or IDFAs, so brands can leverage existing data combined with the partial visibility provided by tools such as Apple’s SKADNetwork to guide initial media buying decisions.
That same modeling can also help establish guidelines to measure and analyze the performance of new campaigns.
The biggest barrier for many in the industry may be the perception that modeling only works for big brands. Modeling does require an investment, but most medium and even small brands can find ways to cost-effectively add some modeling to their ad buying and measurement programs.
Even with IDFAs dramatically dropping off, Facebook and other major social media platforms, and mobile DSPs, can still offer what they’ve always had—massive numbers of consumers and plenty of advertising inventory.
That means the opportunities are still there, and those marketers who figure out how to use data combined with modeling and whatever privacy-protected identifiers can eventually execute campaigns that drive engagement and conversion.
Mike Addonizio is VP Paid Media at Digilant.