Let’s just get it out there: Facebook knows a great deal about you. Beyond just the information you have listed on your profile, the social media giant knows the exact types of posts that get your attention, which ads you’re most likely to click on, and even has access to your browsing habits off the site.
As the future of tech moves toward an increased emphasis on privacy, Apple is looking to put an end to Facebook’s tracking habits. To nobody’s surprise, Facebook is not a fan (to say the least) of the new policies proposed by Tim Cook and the rest of the Apple team.
In this article, I’ll explain the philosophical differences in the approach of both companies, and provide some additional information that Facebook advertisers will need to know in 2021.
What’s at Stake?
For two companies with a combined worth in the trillions – yes, that’s trillion with an “s” on the end – it’s hard to imagine that any policy changes are going to have catastrophic results for either side. With that being said, neither Apple nor Facebook became industry-leaders by resting on past successes.
Apple has recognized that the invasive nature of hyper-targeted advertisements is not something consumers enjoy about their devices. With more than a billion active iPhones worldwide, it’s clear that providing a good experience now can provide a secure profitability model for decades to come.
Facebook, on the other hand, relies on businesses advertising on its platform to generate revenue. With $70 billion in earnings for 2019, it’s clear that the strategy is paying off. With endless other digital ad options on the market today, why has Facebook been so successful? It’s hard to pin down just one reason, but data collection and affordability for advertisers are undoubtedly at the top of the list.
Apple Promises Privacy
The vast majority (nearly 94% to be specific) of Facebook’s ad revenue comes from mobile devices. With iPhones occupying nearly 50% of the market share for these devices, there’s a great deal of crossover between the two tech giants.
Facebook (which includes Instagram – a Facebook-owned company) has become the dominant force in social media marketing because of its massive user base and seemingly-endless amount of data. While it’s great for advertisers, consumers might not share the same opinion.
To call data collection unethical might be a stretch. To call unrestricted data collection without user consent ethical might also be a bit off the mark. The question then is: what does the happy medium look like?
Apple’s answer to the question of user-privacy in regards to data collection is simply to give its users a choice to opt-in or opt-out. Here’s how Facebook describes Apple’s new policy change, which will start to be seen in early 2021:
“Apple will begin to require that all apps in the App Store show a discouraging prompt to users on iOS 14 devices, in accordance with their AppTrackingTransparency framework. Apple’s policy will prohibit certain data collection and sharing unless people opt into tracking on iOS 14 devices via the prompt. As more people opt-out of tracking on iOS 14 devices, ads personalization and performance reporting will be limited for both app and web conversion events.”
Facebook is not thrilled about Apple’s latest developments, to say the least. In an ad that attempted to point out the flaws in the policy proposals, Facebook said:
“Forty-four percent of small to medium businesses started or increased their usage of personalized ads on social media during the pandemic, according to a new Deloitte study. Without personalized ads, Facebook data shows that the average small business advertiser stands to see a cut of over 60 % in their sales for every dollar they spend.”
Does Facebook have a point? Maybe, but it seems like the concerns being addressed by Apple are more of a priority to the population at large.
When Is It Happening?
Apple is already getting started with the privacy initiative. Last month, Privacy Labels began showing up in the App store. These labels reveal how various apps available on the store use your data. In the future, it can only be expected that these labels will become more accurate and robust in scope.
Across the pond, some legislation is rolling out that Facebook hopes will reduce the impact Apple has on the entire digital ecosystem.
The EU’s new Digital Markets Act (DMA) and the Digital Services Act (DSA) was signed last month. Both acts introduce new rules for digital platform holders and aim to force companies to rapidly remove illegal content from the web. “We hope the DMA will also set boundaries for Apple,” said a Facebook spokesperson in a statement.
What Does it Mean for Marketers?
Unfortunately, it’s still a little too early to definitively say how the tracking opt-outs will impact advertisers. With that being said, here are a few of the limitations digital marketers can expect to see in the very near future:
- Single, fixed Attribution Lookback Window: There are no attribution lookback windows available (1D, 7D, 28D etc.), and all app conversions will use a 30-60 day click-through attribution window.
- No ID-based Demographic Breakdown: There will no longer be access to attributes such as age, or gender.
- Probabilistic Data: Some platforms will be using probabilistic data (compared to the majority currently using deterministic data), more on this in the platform recommendations section below.
- Deferred Deep Linking: This will no longer be supported due to the exclusive focus on last-click attribution
If you’re asking, “What if people simply opt-in?” That’s a valid question, but the reality is marketers probably aren’t going to like the answer. Early projections put the number of probably “opt-outs” at 75% or more. It’s clear that a change in strategy is going to be a necessity in 2021 and beyond.
A true battle of tech giants, both the advertising world, as well as consumers concerned about the intrusive nature of the advertising world, are watching anxiously to see where things go from here. For all the questions yet to be answered, one thing is certain: when the dust settles, the new policies will have a lasting impact on the relationship between big tech and big data.