💎 Growth Gems #39 - Gems from the "iOS 14, Privacy and the Future of Digital Advertising"

Hi there,

Today's gems are mined ⛏️  from a presentation on ATT by Eric Seufert.

💎 #1

Advertisers thought you could just not use the IDFA (i.e not show the prompt) and instead use other identifiers. But Apple is not allowing for any loopholes (e.g. fingerprinting) that would undermine its new policy.

02:05

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💎 #2

Back in December Facebook also revealed that the ATT prompt applies broadly to all mobile advertising, including mobile web campaigns.

03:15

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💎 #3

No mechanism may be used for aggregating data at the user level for the purposes of tracking in the case of an ATT opt-out. 
- For web campaigns, ATT governs the use of tracking pixels for user level data collection
- For app campaigns, ATT governs the use of the IDFA for user level data collection

04:00

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💎 #4

For all campaigns (app and web), other identity options like device fingerprints, email addresses, et cetera, as well as back end conversion APIs like Facebook's, can't be used as they are now if the user has not given consent.

04:18

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💎 #5

SKAdNetwork is how attribution will be done for mobile app campaigns for users that have opted out of ATT. Private click measurement (PCM) is how web events will be attributed for opted out users.

05:50

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💎 #6

Both SKAdNetwork and PCM aggregate advertising data at the campaign level and allow for one conversion event (or “instrumented prioritized onsite event”) to be transmitted back to the advertising network in a postback, for every acquired user.

06:08

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💎 #7

ATT is the future, and the most radical interpretation of how severely ATT will be enforced is probably the correct one. Advertisers need to adapt to that (rather than grieving or bargaining or conceiving of workarounds).

10:03

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💎 #8

What might be the primary motivation of ATT for Apple is to regain control of content distribution on iOS, and move away from app discovery being driven by advertising.

12:22

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💎 #9

Apple is most likely using ATT strategically to strengthen its market power, with respect to operating the app store. Because of this, Eric expects that ATT policy will be enforced to the maximum extent. 

13:45

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💎 #10

If products can't survive or thrive through advertising, then those products become more dependent on the platform operator for distribution.

16:20

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💎 #11

Apple gets to define tracking, and then it gets to define the privacy spectrum. With its own approach at the extreme protective end, and tracking at the extreme exploitative end. But in fact, Apple’s privacy rules are at the middle of the privacy spectrum. 

17:17

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💎 #12

Users now expect all of their content to be available across all their devices. The idea of a direct relationship between a platform and a proprietary hardware (e.g. the App Store and the iPhone) is becoming anachronistic and ATT is Apple’s attempt to make this last longer.

20:01

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💎 #13

If ad platforms can no longer efficiently connect supply and demand via serving ads, they'll try to keep content interactions on their own properties so that they can leverage first party data and sell advertising. They’ll become content fortresses. Example: OTT apps in China and Facebook with instant games, instant articles, FB shops, etc.

21:15

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💎 #14

If all the publishing happens directly in Facebook’s services instead of Facebook serving as a routing service between publishers and users, it increases the dependency to Facebook and other platforms. It could result in less real choice for consumers and a much less competitive content ecosystem on mobile.

21:56

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💎 #15

The SKAdNetwork framework that Apple is providing to advertisers is inadequate, unnecessarily punitive and injures advertising beyond what’s required from a privacy standpoint.

22:27

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💎 #16

SKAdNetwork doesn't include parameters that are necessary for optimizing ad campaigns and that wouldn't reduce privacy protections. One example is the absence of a creative ID, which wouldn’t help attributing a specific user to a campaign yet is critical to advertisers (as Apple knows since there is a creative ID in the new Apple Ads attribution - AdServices).

23:04

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💎 #17

As of March 2021, SKAdNetwork is completely dysfunctional: only a few networks are allowing advertisers to run SKAdBNetwork verified campaigns and even for these there are problems with reporting (receiving only a portion of postbacks, incomplete parameter information like conversion values and publisher site IDs).

23:44

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💎 #18

Connect to existing consumers with first party data in as many ways as possible, so you can retain them.

25:00

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💎 #19

As targeting gets less precise, acquisition will become less efficient and to stay viable you need a higher LTV over a longer lifetime.

25:50

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💎 #20

Ad platforms use to do the filtering and provide qualified users. With less qualified users, the product will need to segment users into buckets and optimize the experience of these buckets to better monetize. It will need to go beyond early stage offers and content recommendation.

26:40

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💎 #21

It will be hard to build niche products and advertise to small audiences, and it will impact B2C products in many app verticals that saw success with low DAU, high ARPDAU.

29:01

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💎 #22

Just because impressions become cheaper doesn't mean all advertisers are able to maintain or increase spend. The entire funnel degrades (CTR, retention rates, monetization rates) and this impacts ROI.

29:40

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💎 #23

Products will need to be appealing to a broader audience to reduce the negative impact of losing granular targeting.

30:00

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💎 #24

Most ROI models will need to be completely recalibrated because the composition of cohorts will change as targeting becomes much less granular and LTV projections will change.

30:29

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💎 #25

Only D0 can be used to project out to some target LTV, as you can only transmit data back to the network within a limited timeframe

31:00

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💎 #26

Creative testing will be slower, because there are a limited number of campaign IDs you can use and most of them will be used by ad platforms to model ad group and ad creative performance. 

31:30

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Stay savvy!

⛏️ Sylvain