With the release of iOS 14.5, Apple made notable changes to its IDFA (Identifier for Advertisers) system. This has significant implications for programmatic advertising.
What are those changes, and what have those changes meant for the advertising industry?
What is Apple’s IDFA?
The Identifier for Advertisers, or IDFA, is a random identifier that is generated and assigned to a user’s specific device by Apple. That IDFA is used for tracking and identifying a user without revealing sensitive personal information, such as a person’s name. This depersonalization of user data offers a level of privacy for users and keeps everything on the right side of data protection efforts.
Even without personal information, it builds a user profile that is attached to the device. It’s similar to a cookie, except it’s tied to a device rather than a browser. Advertisers can use Apple’s IDFA to precisely target and track users within an app on their iOS device. The data allows advertisers to deliver personalized advertising, identify when users interact with an advertising campaign, and employ ad retargeting. It can also give them insight into whether a user installed an app thanks to an advertising campaign.
Unlike Google’s ID solution that crosses apps, Apple’s IDFA is only good for the app you see the user in. That means that for each app a user has, they are defined with a different ID in the iOS ecosystem.
Apple’s Changes to IDFA System Impact Online Advertising
Unfortunately, Apple decided to make significant changes to its IDFA system. Apple’s IDFA isn’t going anywhere, but the changes have had a big impact on part of the online advertising industry.
In today’s world of heightened privacy concerns, Apple decided to release new privacy controls related to IDFA. User targeting and tracking at the device level is no longer automatically available to advertisers.
With the release of iOS 14.5, Apple introduced the new App Tracking Transparency (ATT) framework. ATT requires app developers to request user permission before being able to track their data across apps or websites for advertising or data-brokering purposes.
With this new framework, when a user opens an app that wants to track their activity, they will see a pop-up message that asks for their permission. If they withhold that permission, the app can’t access the device’s IDFA. In other words, advertisers are now relying on users choosing to opt-in, rather than having access from the get-go.
Why’d they do it? It’s pretty straightforward. According to Apple, giving users more control over their data is an important step in protecting their users’ privacy. It makes sense – and as an Apple device user, I appreciate the extra steps to protect my privacy. But when it comes to businesses that rely on targeted online advertising, it’s been a little less well received.
How Apple’s IDFA and ATT Rocked the Ad Industry
As I already mentioned, Apple’s ATT has had an impact on the online advertising industry. These are the biggest ways it has rocked the industry:
Reduced Data Collection
The most obvious impact is reduced data collection for advertisers that rely on Apple’s IDFA. Because users are now asked for their permission before an app can start monitoring their activity, there are a lot fewer people offering up data. Many users have decided to opt out of data collection, and it’s definitely reduced the amount of data available to the advertisers who rely on it.
Ad Targeting
With less monitoring, it became harder for advertisers who relied on the data from IDFA to deliver targeted ads. Advertisers have had to shift to other methods to find their audiences. For some of these businesses, they may have seen a drop in revenue because it may have reduced the effectiveness and profitability of their ads.
Measurement and Attribution
Although IDFA plays a big role in targeting Apple users in apps, it also allows advertisers to measure the effectiveness of their campaigns. Without access to that data, it is more difficult to measure effectiveness or attribute conversions to ad campaigns.
Raised Privacy Concerns
While Apple’s changes were made to give users more control and privacy, it also affected the way the rest of the industry looks at privacy. Apple’s introduction of ATT has brought privacy concerns to the forefront. Not only are consumers becoming more aware, but it has also prompted other companies to consider similar measures to protect their users’ privacy.
What Does a Future-Proof Solution Look Like for Advertisers?
The advertising industry is an ever-changing landscape. In order to stay relevant, advertisers have to adapt. There won’t be a be-all and end-all solution that lasts forever when it comes to online advertising. However, there are some ways that advertisers can adapt after the introduction of ATT. These strategies can help maintain their advertising performance and profitability, while also respecting new rules concerning user privacy.
Contextual Advertising
Just like Apple and IDFA, there have also been changes to third-party cookies. With more concerns than ever regarding privacy, contextual advertising has become more of a go-to for online ads. Instead of delivering ads based on someone’s browsing history or other activity, it involves matching the content of an ad to the content of a webpage or app. It’s an effective way to reach audiences who are interested in a product or service without relying on personal data.
Build First-Party Data
Companies can collect their own first-party data to use. They can then harness that first-party data to unlock the power of personalized advertising. Encouraging users to sign up for newsletters, creating surveys, or asking for feedback are all ways to gather that information. With detailed knowledge of customer preferences and behaviors, businesses can deliver targeted messages, relevant product recommendations, and tailored promotions. Here are some effective ways that advertisers use to build first-party data:
- Encouraging users to sign up for newsletters
- Create surveys and feedback tools to directly ask about preferences, interests, and purchasing habits
- Utilize incentives, such as discounts or giveaways, to encourage users to fill out forms
- Leverage customer interactions and CRM data
Focus on Engagement
Instead of relying solely on ad impressions, focusing on engagement is another effective strategy. Create engaging ads that encourage users to interact, utilizing playable ads, shoppable ads, VR/AR ads, interactive ads, and more. It will create a memorable ad experience that catches a user’s attention.
Take Advantage of JetStream
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Sonobi’s JetStream platform uses a People-Based ID (PBID) to match real audiences and their devices to any major marketplace technology. JetStream’s PBID works efficiently with all CRM and 3rd-party match technologies, giving the programmatic buying platforms an identity solution they can instantly recognize. This not only maximizes the scale of supply for programmatic buyers but also allows for supply-side campaign targeting across an expanding curated marketplace.
Future-Proof Solutions With Sonobi
As you can see, there are many other methods that advertisers can employ following the introduction of ATT. Although user targeting at the device level with Apple’s IDFA is no longer automatically available to advertisers, it doesn’t have to mean a loss of advertising performance and profitability.
If you’re interested in learning more about how you can future-proof your advertising strategy in the age of privacy-focused advertising, schedule a demo with us to get an exclusive look at our product offerings.