On April 26, Apple released its iOS 14.5 update, which put an emphasis on user privacy. With this change, companies running digital campaigns on Facebook will see an impact on performance as users are opted-out by default. Instead, they now have the option to opt-in to receiving ads.
It’s hard to forecast the true impact of this major change on digital marketing campaigns. That’s why we looked at early data on campaign performance across our client portfolios. These insights can help marketers prepare enough to address this change and make a major shift to their digital marketing strategy.
How Quickly Will Users Adopt iOS Version 14.5?
When we looked at data available to us across high-volume accounts, we saw 16.6% adoption of iOS 14.5 in the first 10 days after being released (April 26 – May 6). The chart below shows how this compares to adoption rates of other iOS updates in the past.
While adoption rates of this new update continue to rise over time, another key metric to monitor is the number of users who opt-in to having their personal data shared with advertisers. Three weeks after Apple’s iOS 14.5 update, only 5% of iOS 14.5 users in the United States have opted-in to ad tracking, according to Flurry Analytics. This is significantly lower than the 13% of users worldwide who have opted-in.
Apple’s iOS 14.5 is a major foray into a privacy-centric marketing environment. While still early, we have data that illustrates the impact on Facebook advertising campaigns.
Early Impact of Apple’s iOS 14.5 Update on Facebook Campaigns
We combined Facebook campaign performance across high-volume accounts between May 3 and 16, when adoption rates of iOS 14.5 were between 20-30%. Then, we compared that to a baseline of the same period in the previous month, April 5 through 18. Finally, we segmented results between iPhone and Android users to illustrate the impact on iPhone users, specifically.
This data gives us early insight into the impact of new user privacy settings. Here are a few findings to help marketers see the impact of these changes.
Advertisers Have Fewer Insights and Less Control
When we dug deep to focus on website actions, we learned Facebook has started to cloak device breakdown information for conversion metrics. Between May 10 and 16, they bucketed more than 85% of conversions into a new device type: “Other” (illustrated in the chart below). Not surprisingly, this started on April 26 when iOS 14.5 was first released.
Unfortunately, advertisers looking to understand the impact of tracking on different device types won’t find many insights through Facebook. Cloaking user devices like this may have been done to prevent widespread, advertiser-driven actions such as opting campaigns out of mobile altogether if it seemed like performance was decreasing.
Furthermore, Facebook also stripped away insight into which placement types conversions come from. Not surprisingly, this started the week of April 26, when iOS 14.5 was first introduced.
Campaigns Have Declined in Cost, Clicks and Impressions
Another major impact of this update is a decline in total reach. Compared to the baseline period, cost, clicks and impressions were down across both iPhone and Android devices. However, iPhones saw more significant decreases.
Percent Change In Cost, Clicks And Impressions By Device Over Baseline Period
It was inevitable. Consumers now have more power and control over their data than ever before, and they’re also aware of their choices. Not only can they seek out privacy settings, but now, they’ll be prompted to make a decision before anything is decided for them.
This update is quite significant for marketers. It shows an acceleration towards a more automated, less transparent experience. On top of that, marketers will have smaller audience sizes to work with. This means ad creative needs to get better, offers need to be more enticing, and value exchanges need to be as seamless as ever.
Marketing leaders running campaigns impacted by this change should work with their marketing teams or agencies to understand the deeper impacts of smaller audiences, limited reporting, and the effectiveness of their advertising content.