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Keeping Up With Google: What Apple’s iOS 14.5 Update Means for Retailers Advertising on Google

Updated on 4/29/21

Apple’s AppTrackingTransparency (ATT) feature, a key component of iOS 14.5, began rolling out on April 26, 2021. This privacy update prompts iPhone and iPad users to opt in or out of data tracking across apps and websites, which can have major implications for retailers advertising across Google.

With users having the ability to deny any tracking of their activity, there are a growing number of questions as to how Google advertisers can best navigate the changing space. In a January statement Google indicated that several performance metrics may be affected by the privacy update:

“Apple’s ATT changes will reduce visibility into key metrics that show how ads drive conversions (like app installs and sales) and will affect how advertisers value and bid on ad impressions. As such, app publishers may see a significant impact to their Google ad revenue on iOS after Apple’s ATT policies take effect.”

Check out our Keeping Up With Facebook article on how Apple’s iOS 14.5 update can impact retail marketers across Facebook Advertising.

To help retail marketers understand how ATT is impacting their Google advertising, we have put together the following FAQ with our most up-to-date learnings and findings. Please consult the additional Google resources below for more information on how to prepare for the iOS 14.5 update.

What has Apple released, in layman’s terms?

Starting with iOS 14.5, Apple is requiring apps to ask for user permission before using the device’s unique advertising identifier, known at the IDFA. The requirement is known as AppTrackingTransparency (ATT). The biggest change that ATT brings is that users must opt in to tracking, rather than opt out of tracking.

Who is impacted by the ATT update?

iOS app developers who are using the IDFA, such as Google, Facebook, retailers, and many other organizations.

When did the ATT update go into effect?

It went into effect with iOS 14.5 on April 26, 2021. From here, users will adopt the new iOS over time. For a sense of the adoption timing, iOS 14 reached 81% adoption after about three months. In earlier cases, Apple reported that over 50% of all iPhones were running iOS 13 after 26 days. Once users upgrade to iOS 14.5, it remains to be seen how many choose to opt in or out of tracking. Some industry analysts predict that many users will not opt in to tracking when given the choice. However, other schools of thought predict that many users will opt in because they have grown accustomed to tailored experiences.

What is IDFA?

IDFA, or Identifier for Advertising, is the unique identifier that comes with every iOS device. IDFA is the key that lets developers and marketers track user activity for advertising purposes. In iOS versions prior to 14.5, users can opt out of all remarketing by enabling a device setting called “Limit Ad Tracking” (LAT). This setting restricts advertisers from using the IDFA for behavioral advertising.

What is the new user experience with ATT in iOS 14.5?

When a user opens an app that uses IDFA on their iPhone, a pop-up window appears. The pop-up warns users that the app is tracking their data for advertising purposes, and provides the option to block the app from doing so.

Do app developers have control over what the pop-up says?

Developers can customize the text within the space limitations of the pop-up.

As a retailer that uses Google Ads, how does the ATT update affect my campaigns?

We at Sidecar, as well as Google, are continuing to understand the full scope of the impact. Much of the impact will depend on how many users opt out of tracking. If a large number of users opt out, retargeting audiences will shrink and prospect targeting will become less granular. You might see fluctuations in delivery and performance for ad campaigns that run on iOS.

Does the ATT update mean that users won’t get my ads at all on their iPhone?

No. Your ads still appear. However, your targeting capabilities may be limited. Users are prompted to allow or decline tracking permission upon opening an app. Users who allow tracking continue to receive targeted ads based on their activity. Those who choose not to participate still receive ads, but those ads are not tailored to the user.

How is Google reacting to the ATT update?

Several of Google’s iOS apps, such as Maps and YouTube, use IDFA, which would require ATT. However, Google will no longer use the IDFA and therefore will not show the prompt in those apps, which aligns with Apple’s guidance.

Google has said it will switch to another Apple tool, called SKAdNetwork. Apple introduced it in March 2018. This tool is considered a more privacy-oriented approach to campaign measurement. SKAdNetwork is an aggregate method for measuring attribution of mobile ad campaigns for iOS apps.

In addition, Google continues to make progress with its Privacy Sandbox technology for Federated Learning of Cohorts (FLoC). FLoC clusters large groups of people with similar interests, which advertisers can then target. Google’s new test results show on average, advertisers can expect to see at least 95% of the conversions per dollar spent when compared to cookie-based targeting, for interest-based audiences, such as in-market and affinity segments offered in Google Audiences.

How is Sidecar managing the ATT update?

We are remaining in close communication as always with our partners at Google, as well as Facebook and Amazon, to understand how they are reacting to the change. As they continue to develop recommendations and updates to their platforms, we are understanding those changes and providing guidance to our customers to help them prepare for and measure the impact of Apple’s privacy update.

We are also exploring all possibilities for how the update may impact our technology solutions. Despite this, and many other changes to the advertising market over the years, our commitment remains the same. Our goal is to meet our customers’ needs and maintain campaign performance. We, with our customers, will adapt as needed to drive success in today’s retail advertising market.

Should I expect Apple to expand ATT to Mac OS?

It’s plausible that Apple will eventually extend ATT to Mac OS.

Should I stop advertising on Google?

No. Google’s goal is to ensure a thriving ad-supported digital ecosystem. Google will continue meeting advertiser needs, while giving users transparency, choice, and control over their data. Apple’s privacy changes are part of an evolution in the advertising market, in which all players involved are adapting to operate within a new normal. It’s important to understand what’s changing and then determine how to adapt, not simply stop, your advertising efforts.

Google Ads Resources

Preparing our partners for Apple’s iOS 14 policy updates
Preparing your app for iOS 14+
Building a privacy-first future for web advertising

We will continue to update this post with new information and recommendations.

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