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By Lee Davis
Head of Performance Media
Media Precinct
Whether we like it or not, the digital marketing landscape is rapidly changing (again). User privacy has been a hot topic for a while now, but we’re at a point where things are starting to happen. Whether we’re talking about the deprecation of 3rd party cookies which should be completed next year, or the impact that Apple’s latest operating system, iOS 14, will have on in-app data collection and the advertising targeting capabilities that our industry is reliant upon, it’s clear that the future of advertising will be privacy centric so we need to start planning for the future.
The recent media war between tech giants Apple & Facebook highlights this situation perfectly. Apple have been pushing user privacy for a while, notably with the roll out of ITP (intelligent tracking prevention) and now their latest operating system, iOS 14, which puts privacy and data collection firmly back in the hands of the user by prompting them if they wish to be tracked across other companies’ apps and websites. This change in 3rd party data impacts all apps but Facebook is making their voice heard.
Whether you believe Facebook is genuinely standing up for small businesses or not, arguing they rely on the platform and its powerful targeting capabilities to run a successful business, the reality is that Facebook sees this latest privacy push by Apple as a direct threat to their bottom-line. Why? Because the loss of data from their end dramatically reduces the accuracy and scale of their audience segments. The disruption of this data and lower funnel activity like re-marketing suggests that advertisers may well have to pay more in the future to achieve the same results which leaves us with the questions - Will an Apple iOS user become a less desirable and valuable audience if the targeting and attribution accuracy is ultimately weaker? Does this make channels like Facebook vulnerable to losing marketing budget?
Facebook is without doubt one of the most powerful and highest reaching advertising platforms in the market, driven by data. The reality is that there’s not much they don’t know about you so what happens when it’s not addressable?
The chances are you will have watched, or at least heard of the Netflix documentary ‘The Social Dilemma’, which paints a somewhat dramatised picture into the tracking and targeting abilities of Facebook, but if you’re looking for a more realistic picture of the data being leveraged, I encourage you to check out the nutrition label of the Facebook app in the Apple App Store and see what information is collected for yourself.
On the flip side, we need to factor in the impact on user experience if ad relevance declines. Are users willing to trade their data for a better platform experience? Are they likely to be more receptive to advertising if it is tailored towards their interests, needs and purchase patterns?
The reality is that it will take time to accurately quantify the impact of this change, factoring in iOS 14 uptake (which isn’t a forced update) along with privacy policy tracking adoption. Apple’s mobile device share in Australia currently sits at 54% which still leaves a significant percentage of the market unaffected but there are already whispers in the market of Google following Apple’s lead in app privacy control, much like they did with the deprecation of 3rd party cookies. There will also be implications for apps/ developers who rely on advertising revenue as reduced visibility into performance and conversion modelling will likely mean advertisers reassess their digital strategy and budget allocations by channel.
In summary, user privacy is here to stay and this is the latest challenge agencies and brands need to overcome in this ever-changing media landscape and it really highlights the importance of a multi-channel digital media strategy that revolves around 1st party data, contextual placement and media quality.
Interesting times ahead but we love a tech challenge at Media Precinct so reach out to us with any questions or concerns you might have!
Lee Davis is the head of performance trading at Media Precinct. If you would like to understand
more about how Apple's policy change may impact your advertising, contact Richard Turner on +61 2 8081 2660 or email rturner@mediaprecinct.com.au
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