IDFA plays a major role in identity, attribution, efficiency, audience targeting, frequency capping, and fighting fraud, among other areas. Advertisers will need to rely on other sources of knowledge – including probabilistic and contextual data signals – for advertising identity post-iOS 14, says, Srinivas KC, vice president and general manager, InMobi DSP.
Apple’s latest mobile operating system version, iOS 14, will impact the data, in-app advertisers and mobile Adtech have available to them. As a result, how they identify consumers in-app will be notably impacted.
What does this specifically entail? With iOS 14, Apple is requiring all apps to display a fairly standardized pop-up at some point to all users that asks them to opt in to having their data collected and used for advertising purposes. Apple’s goal with this move is to improve transparency and privacy, and give consumers an upfront opportunity to specifically opt in to having information about them used for advertising and marketing purposes.
As a result of this move, the current consensus is that the vast majority of consumers will not consent to opt in to give permission to every single app they have on device – and this problem will be especially acute for smaller app developers and publishers. This means that a persistent Identifier for Advertisers (IDFA) will largely be unavailable for advertisers to utilize across all apps that someone may have.
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Many advertisers and their mobile Adtech partners are still determining how this move will impact their efforts and even their overall business since the IDFA underpins the mobile in-app advertising ecosystem on Apple mobile devices today. But, while the IDFA will likely be less ubiquitous in the future, that doesn’t mean that advertisers will no longer be able to identify their target audiences on mobile; rather, iOS 14 will facilitate a recalibration of how it’s done.
How Advertising Identity Is Handled Today
Before I dive into the future, let’s level set on what occurs today. While advertisers have a few options for identity on Apple devices, the IDFA largely serves as the catalyst.
IDFA is a unique ID for each iOS device that mobile ad networks, exchanges, etc. typically use to serve targeted ads. Since each IDFA is unique to a single device and relatively static (stays the same as long as the same device is owned and used), it is easy to see why it has been a linchpin to iOS advertising for so long.
With IDFA, advertisers can effectively personalize ads, ensure that the same person doesn’t see the same ad too many times in one day, even across devices (frequency capping), retarget high-interest users, and develop highly effective lookalike audiences. The IDFA can also help advertisers fight fraud since it can help advertisers and mobile measurement platforms (MMPs) determine if a real person indeed was exposed to an ad.
How In-App Advertising Could Work Post iOS 14
While there are divided opinions in the mobile advertising ecosystem about how good or bad this (recently delayed) launch is going to be, there are multiple productive ways that advertisers can move forward. On the one hand, all of us in the independent mobile ad tech space (including, of course, InMobi) have quickly worked with the industry trade group IABOpens a new window to come up with new specs on how advertising should work. Of course, on the other hand, Walled Gardens will either fight the change wholesale and/or build their walls higher – and thus make the entire ecosystem less open and less transparent.
So, if and when IDFA is largely unavailable in a universal manner, what will mobile advertisers use to identify their best audiences? For starters, I expect contextual data signals to play a larger role in the future. After all, depending on the type of app being used and the type of content being consumed in app, advertisers can make at least some reasonable assumptions on who that person is and what types of ads they may want to see.
Similarly, advertisers will also likely lean more on probabilistic data signals in the future. This may be less common though, since it requires advertisers to have both high-quality first-party data and highly effective predictive analytics capabilities, both of which are far from guaranteed.
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Advertisers care about identity for branding campaigns, which will be impacted by iOS 14, but there are enough real-time signals to support advertisers. In addition, third-party ID systems from the likes of LiveRamp will likely become more central to in-app advertising.
This means that while identity will be impacted in the short term, it may be less of an issue in the long term. As a result, I don’t see a major shift in mobile in-app advertising’s long-term outlook.
For advertisers that are focused on down-funnel metrics like user acquisition, they are forced to use SKAdNetworkOpens a new window , Apple’s privacy-focused app install attribution solution. While SKAdNetwork brings deterministic attribution and advertising protection to the table, it is far from ideal in its current state. For example, it provides far limited data and user long-term value (LTV) analytics compared to what MMPs now show and doesn’t allow for several key features that are currently handled by MMPs. In the future, I see advertisers using SKAdNetwork in combination with a chosen MMP to handle tracking, attribution, etc.
How Advertisers Should Be Thinking About Identity Holistically
For starters, I am glad that iOS 14 has spurred much-needed conversations in the mobile advertising space around privacy. There needs to be alignment on privacy, as the old way of doing things was not ideal from a transparency/trust point of view.
But iOS 14 has left the entire App store ecosystem (i.e., app developers and Adtech) with a lot of work to do. On the one hand, there is broad alignment on the need to prioritize privacy. But on the other hand, advertisers and app publishers want to be sure they can provide the best possible advertising experience, both by being able to reach the right people with the right messaging and by ensuring that people see ads they like. Is there a way to square both?
For advertisers, I think iOS 14 pushes them to rely more on their own data and platforms. As a result of this shift, it’s not hard to predict that there will be a greater reliance on first-party data sources. By having a better pool of your own data that you know is accurate and was gathered in a privacy-compliant manner, you can be sure you are able to talk to the right people while still respecting their privacy.
Frankly, advertisers should have been moving in this direction even before Apple announced these latest changes. In today’s omnichannel world, in which consumers move across media and are influenced across up to dozens of channels before making a purchase, the need for data that is effective across devices is paramount.