Apple’s ATT Privacy Crackdown, Strategies for Success in a Privacy-first Landscape

Three years have passed since Apple introduced its App Tracking Transparency (Apple’s ATT) privacy framework. Advertisers have faced numerous challenges since then, including a major shift in consumer behaviors due to a global pandemic, lingering macroeconomic challenges, and the potential implications of Google’s ever-changing cookie deprecation deadline. These issues have forced advertisers to adapt their strategies and have led to increased scrutiny of their ad spend.

As budgets tighten and the focus on consumer privacy fundamentally changes how advertisers understand and reach their audiences, measurement has become increasingly important. The need for metrics to prove results, and back up the decisions made, plays a significant role in strategy planning.

Three years on, let’s examine how Apple’s ATT has impacted (and continues to impact) ad strategies and what advertisers need to know to plan effectively for the year ahead.

A More Privacy-conscious Consumer

Advertisers know that consumers place a higher value on brands that reflect their values regarding consumer data privacy. Cisco’s 2023 Consumer Privacy Survey highlighted that an increasing number of consumers are taking action when it comes to their privacy. On average, 40% of consumers under the age of 45 are exercising their Data Subject Access Rights, showing a willingness to stop engaging with businesses based on their privacy practices, or lack of data protection protocols. Apple saw this trend and made a strategic brand play in 2021 that paid dividends for the tech giant in building up the Apple Search Ads business, but also importantly endeared them to consumers.

While opt-in rates in 2021 were low, we’ve started to see an increase. More consumers that are prompted to allow advertisers access to their app data are agreeing to do so. According to a recent AppsFlyer study, more than half (51%) of gaming app users shown the ATT prompt are now allowing tracking, a 10% increase since the launch in April 2021. This compares to 46% of non-gaming app users, a 3% increase.

These numbers represent relatively small percentage increases, but they constitute a significant added pool of data for advertisers in a multi-billion dollar industry. The opportunity to secure opt-ins has also increased, especially for gaming apps. The AppsFlyer study showed that as of Q1 2024, 84% of gaming app developers and 68% of non-gaming app developers have opted to show users Apple’s ATT prompt, asking them to opt-in to tracking rather than automatically opting them out. This signifies an average 15% rise in adoption by developers since ATT was first introduced.

It’s worth noting that this is also a two-way street. The Apple ID for Advertisers (IDFA) represents the share of iOS users that have a unique advertising ID, meaning they allow tracking across different apps on both the publisher and advertiser side. To simplify: these users allowed BOTH companies to share their data. This number is not quite as high – as of Q1 2024, just 1-in-4 people have still have full data granularity and no signal loss, essentially functioning the same as before Apple’s ATT rolled out.

The ATT Rollercoaster: From Drop to Climb

When Apple first rolled out ATT, the industry experienced a significant drop in iOS ad spend. For about six months, advertisers grappled with uncertainty amid doom and gloom projected through the press. Industry experts estimated a double-digit decline in ad spend and a 15-20% revenue drop for iOS advertisers. The privacy-centric framework disrupted established tracking practices, leaving marketers scrambling to find new solutions.

Fast-forward to today and the macro narrative has shifted. Advertising dollars are no longer in freefall; they’re climbing steadily at more than a five percent clip. So, what changed?

Despite challenges, innovation has been a beacon of hope. Next-gen AI tools have integrated into tech stacks or helped to enhance existing software. Ad tech companies have developed workarounds, improved attribution models, and found ways to navigate Apple’s ATT landscape. Had this piece been written 18 months ago, the economic conditions would certainly have played a more ominous role. However, as the global economy rebounds, marketers are more willing to invest. The combination of increased confidence in iOS measurement and improving economic conditions has fueled optimism. Advertisers recognize that iOS remains a valuable platform, especially for reaching high-quality audiences.

Doubling Down on iOS

Consumer attitudes toward privacy have evolved. More users are willing to opt into tracking when the value exchange is clear. Advertisers have worked hard to demonstrate the benefits of personalized experiences and relevant ads. This shift is particularly pronounced in the gaming category, where opt-in rates have surged.

The study showed that advertisers continue to double down on iOS when compared with Android, despite the challenges they faced in the aftermath of Apple’s ATT rollout. Beginning in May 2023 and through Q1 2024, iOS has seen a significant increase in app installs as a result of marketing (non-organic installs), with a 51% increase year-on-year, compared to a 21% increase on Android. In fact, the overall rise in ad spend on iOS significantly outpaces that of Android, boasting a five times higher increase. This signals a shift in marketers’ perceptions and burgeoning confidence in iOS measurement capabilities.

This boost can also be attributed to the coveted demographic iOS users represent — typically having a higher household income, high engagement, and increased loyalty. Advertisers recognize the value of reaching this audience, even amidst privacy constraints. Marketers understand that measurement on iOS is feasible, albeit with some limitations and strategic adaptations made across their tech stack, and the audience is worth the effort.

The Road Ahead: Better Creatives and Measurement

Despite this relatively positive outlook for iOS advertisers, many marketers still struggle with measurement because of Apple’s ATT and signal loss. While half of apps increased their ad spend, that leaves half that did not because of the complexities involved.

As we look ahead, the pressure is on creative teams to create compelling ad creatives that resonate and drive action. The value exchange must be crystal clear to show users the benefit to them of opting in. Innovation in measurement technology and other key factors have helped the industry adapt – and advertisers continue doubling-down on iOS because of the highly valuable audience. If measurement wasn’t working to some extent, we wouldn’t see the increase in ad spend. It’s not at all perfect, but the industry has once again shown resilience and adaptability in the face of challenges, and the future looks promising. As we move forward, it’s crucial for the industry to continue innovating and adapting to these changes to ensure continued growth and success.