Is AdTech Prepared for Apple's Privacy Changes?
In our last blog post on the Changing Ad Tech Landscape, we discussed Google’s phasing out of third-party cookies from its Chrome browser. The advertising technology space has been shaken once again—this time by Apple’s iOS 14.5 update.
This new privacy update requires apps to seek opt-in consent before providing targeted advertising via Apple's Identifier for Advertisers. Called the App Tracking Transparency (ATT) framework, it has brought in a major shift in the ad tech ecosystem by switching it from an “opt-out” arrangement to an “opt-in” one.
Earlier, Apple allowed developers to track iPhone activity across multiple apps and share it with other services. But the ATT framework has forced developers to issue a one-time prompt regarding tracking preferences, allowing users to set permissions for individual apps.
The move has been hailed by privacy advocates for bringing in more transparency and control to the ad tech landscape. However, the industry has witnessed a drop in spending on advertisements as more users are choosing not to opt-in to Apple’s tracking features. ATT has significantly impacted a large number of advertisements for users who upgraded to iOS 14.5.
As per Flurry Analytics, iPhone users are rejecting apps’ requests to track them three-quarters of the time. This is a matter of grave concern for ad tech professionals and has prompted several advertising groups to lodge complaints with the regulators. The new rules have led to many advertisers holding back on spending while some are waiting to ask users to opt-in to tracking.
Why the Change?
With the two key players, Google and Apple, changing the ad tech game, the entire industry is in for a ride. So, what led to these major developments being rolled out within such a short span of time?
Consumer awareness has definitely grown in recent years, along with increasing legislative requirements. The existing and upcoming regulatory guidelines have indicated that advertisers need to look for alternatives to tracking-based advertising.
Regulations like the GDPR, ePrivacy Regulation, and the CCPA are aimed at empowering consumers by requiring explicit consent from them. To be in compliance with these laws, the digital advertising landscape must evolve and address the concerns around data and privacy.
On a similar note, Google's David Tempkin stated, “If digital advertising doesn't evolve to address the growing concerns people have about their privacy and how their personal identity is being used, we risk the future of the free and open web.”
The Way Forward
The most common solution that comes in response to the phasing out of third-party cookies is a shift towards first-party data. But what is often ignored is that though tech giants like Google have their own first-party data hub, the same cannot be said for small and mid-sized companies. Such a move will prove to be disastrous for smaller companies, forcing them to rely on larger platforms and market operators.
However, companies are working on solutions to help marketers serve users in a more privacy-friendly manner. Apart from Google’s Privacy Sandbox and Microsoft’s PARAKEET that we have discussed in the previous article, a few other solutions that have garnered attention are Verizon Media’s ConnectID and Nielsen’s ID resolution.
The ConnectID is a unified ID solution that enables purchase, measurement and optimization of ads for the marketers and managing, monetizing and navigating audiences for the publishers. It can achieve so without the use of third-party cookies by leveraging Verizon Media’s consumer relationship through its several owned and operated consumer brands.
On the other hand, Nielsen’s identity resolution solution called Identity Sync can measure campaigns across platforms. It relies on the first-party identifiers accessed through direct integrations with publishers and advertisers.
There is no dearth of alternatives to third-party cookie tracking systems but what remains uncertain is which of these solutions will gain widespread acceptance and help connect a greater number of advertisers with a larger number of consumers.
Role of Privacy Professionals
Operating in different regions with diverse regulatory environments can be challenging. As privacy professionals, you can help your marketing teams as they navigate through this new advertising landscape.
Manage Advertising Data: Advertising activities generate a large amount of data that needs to be stored, shared, processed, and managed in accordance with a complicated set of rules and regulations across many different jurisdictions. Privacy professionals can be actively involved with the advertising team to ensure that the organization’s marketing strategies are in compliance with the regional laws.
The marketing teams need to flexible in their approach as the options for engaging with the customers are changing. Current methods to report on campaign performance metrics and conversion tracking are also constrained. Building direct relationships with customers, that are transparent and in line with the new regulations, where the customers are in control will be the way forward. But this change will not be easy. Helping the marketing teams navigate through these changes will be an important task with the privacy and governance professionals having to play a significant role.
As we outsource and work with vendors, having playbook, checklists will also ensure the agencies and vendors that marketing teams work with are complying with the provisions and adopting best practices.