What is IDFA?
Apple created ‘Identifiers For Advertisers’ a.k.a. IDFA, as the only means for ad tracking within apps on an iOS device. IDFA enables advertisers to be notified when a user of a phone has taken an action. Every iPhone is assigned a unique IDFA that advertisers use to receive invaluable feedback about user engagement, albeit at an aggregated level, helping them to optimize ad campaigns and target customers with the most relevant content.
WITH A USER BASE OF ~720MN, ANY CHANGE BY APPLE IS GOING TO IMPACT MARKETING STRATEGIES GLOBALLY.
How is the industry trying to solve it?
Advertisers register their ads with Apple to be displayed to users, and if a user engages with the campaign, the advertiser gets notified that their campaign was successful. This delivers the most stringent privacy capability while still allowing some form of ad targeting. There are multiple limitations to this: No real-time data [24-48 hours lag], ads displayed in non-Apple media platforms isn’t supported, Apple will be sole proprietors of all data generated through their SkAdNetwork.
Email Hash – MD5S
An email address converted into “a 32-character hexadecimal string processing sensitive consumer information” down a one-way street that cannot be tied back to an individual. This makes it a privacy-focused identifier that can securely link data to create anonymous user profiles, but is still able to target consumers with highly personalized ads.
Fingerprinting collects mobile device attributes like IP addresses, device types, software versions, and more, and uses them to create a “signature” that probabilistically identifies a device. That same signature is collected both on the click and when the advertised app is launched. Then the two are matched, with some statistical error.
What is changing with the IDFA?
Apple announced that with the upgrade to iOS 14 (early 2021), IDFA will NOT be available by default for advertisers unless users explicitly opt-in. Multiple surveys, focus groups and research predict an opt-in rate in the range of 10-20% – a nightmarish proposition for marketers and advertisers.
The world without IDFA – What’s the impact?
Last-Touch and Multi-Touch Attribution Models – Incomplete customer journeys
Mobile attribution providers use IDFA to identify a device and link to an action such as a mobile app install.
Fraud Prevention – Fraudulent attribution
Fraud prevention solutions rely on ad identifiers to ensure the accuracy of advertising attribution. Some types of fraud can be reduced with IDFA.
Campaign Optimization – Lower marketing efficiency
Ad networks and marketers rely on their ability to link an ad campaign to a particular user in order to understand how their campaigns are performing.
Retargeting – Unable to do focused targeting
Retargeting works to target a specific segment of users (Example: people who added an item to a cart, but did not make a purchase.) These segments are then pushed to ad platforms dedicated for retargeting in order to bring people back into the app.
Privacy continues to be an important focus for Apple and this move to ban IDFA is part of that strategy. Marketers remain divided on the impact. The future will look at any of these industry solutions taking shape and/or some creative marketing strategies such as lookalike modeling or contextual marketing. Apple first announced these iOS privacy updates in June 2020 and have delayed implementation until early 2021 for marketers to prepare.