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You may have seen or heard about it, particularly if you’re the proud owner of an iPhone. According to Apple, their latest software update – iOS14.5 – offers users new levels of security, privacy and control.

Before now Apple devices would allow third parties to track what the company calls IDFAs (Identifiers for Advertisers). It meant the likes of Google, Facebook and digital marketing agencies like Traction could monitor and measure an individual’s ad clicks. But Apple have said ‘no more’, with this latest iOS14.5 update blocking any outside party from gaining access to this data.

But what do these changes mean in real terms? Let’s take a look at how the latest update affects iPhone users and advertisers, and specifically how it might affect the performance of campaigns on Google Ads.

How will things change for iPhone users?

Once an iPhone user updates to iOS14, they’ll no longer need to opt out of being tracked by an app – they’ll instead have to opt in. There’ll also be an option within Settings that automatically stops all apps from tracking you.

This is a huge change, as before now the overwhelming majority of iPhone users either didn’t realise that apps were tracking them to the degree that they were, or didn’t care enough to opt out. As such, advertisers received data from the majority of iPhones.

Switching to an opt-in system will essentially turn off the data tap for advertisers for this significant slice of the population (well over 40% of Kiwis own iPhones.) It is expected that advertisers will be left with a fraction of a percent of the data that they used to enjoy from iPhone users, which was used to target campaigns and convert customers more efficiently.

But, while this might all sound dire to any brand hoping to maximise the return on their advertising spend, the truth is that the change isn’t as earth-shaking as it at first seems.

What does the iOS14.5 update mean for advertisers?

There will be two main impacts for advertisers:

  1. Retargeting to website visitors when using an iPhone will be less effective. The fact that we won’t know whether a certain user has visited a website will likely result in a dip in conversion rates.
  2. Facebook ads will be less effective, and will see lower conversion rates or a higher cost for a conversion, because Facebook won’t have as much information about a user’s online activity.

But just as importantly, there are a wealth of things that the iOS14.5 update won’t affect. The following advertising strategies will work exactly as they did before:

  1. Google search ads
  2. Using audience interest groups to target advertising
  3. Using Facebook custom and look-a-like audiences – based on user data that you upload
  4. Retargeting within apps on Android devices (over 55% of New Zealander’s own Android handsets.)

How will things change for Traction customers?

For our customers, the main areas that are affected by this update – retargeting campaigns and advertising within mobile apps – make up the smallest component of our Google advertising budgets. In the case of app advertising, we hardly touch it, as we have found that the returns are simply too low.

This is likely to be the first shot fired in a long battle between over user privacy. Apple, Google and Facebook are all incentivised to understand a user’s online actions so there will no doubt be further developments. Where it will end is hard to say, but for now you can largely ignore the big scary headlines, and be confident that the negative effects on your advertising campaigns will be limited.

And you can be confident that as things continue to develop, our expert team at Traction will be finding new and creative ways to maximise the ROI of your advertising spend.

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