Apple released a platform update for its iOS 14 in the fall of 2020 that generated a lot of controversies. According to Apple, the update is supposed to improve the user’s privacy. However, experts feel that the update will affect the marketing ecosystem severely in 2021.

According to international SEO expert Idan, most of the digital campaigns these days predominantly target mobile phone users, and more than 50% of the smartphones used in the United States are iPhones. More than 90% of iPhone users have iOS 13 on their iPhones and are expected to upgrade to iOS 14 in 2021.

The new update for iOS 14 includes several features intended for a better user experience. However, marketing experts like Idan are concerned about the new and enhanced privacy features which are part of the bundle.

More than 56% of marketers expect to see negative results in the first quarter of 2021 due to the update. Studies have found that almost one-third of digital marketers would curb their spending budget on mobile advertisements.

Many of them have also said that they might be shifting their ad spending towards Android-based mobile operating systems. Several digital marketers plan to find alternative ways to track their audience as well as to measure the success of ad campaigns.

The changes made by Apple in the tracking technology was not entirely unexpected. However, the announcement of the update did cause a lot of stir and controversy during their annual event for app developers. 

The social media giant Facebook has warned Apple that the new privacy settings can reduce the revenue from Audience Network by up to 50% since App developers use the consumer data for their ad targeting.

Let’s see how the updated features are going to affect the digital marketing landscape.

Changes to Data Tracking

iPhone users could always limit the amount of data that the apps can crack or share. However, in the earlier days, users had to manually change the settings to stop the tracking and sharing of their data.

With the new iOS 14 update, data tracking by applications will get thrust into the spotlight. Application developers will have to request a user’s permission to track the data, which could reduce their access to IDFA (Identifier for Advertisers).

IDFA has played an essential role in the advertising industry since 2012 in the Apple ecosystem. It allowed the application developers to gather data to segment audiences, target advertisements, and measure privacy choices. The advertisement industry expects most iPhone users to opt-out of data tracking. It would have a significant impact on the way the digital marketing industry functions.

Internet browsing is also going to get affected by the new update. With the new iOS 14, users can monitor whether their data is getting tracked or not using Safari’s Intelligent Tracking Prevention (ITP). ITP will be active by default for all iOS website browsers, which will affect third-party cookies.

Changes to Location Tracking

The new update on iOS 14 will make it difficult for trackers to use an iPhone’s precise location. iPhone users can choose whether they want to allow apps to access their precise or approximate location. If a user chooses the precise location tracking, analysis of foot traffic in a store will remain unaffected.

However, for users that use approximate location, it might become difficult to measure in-store traffic. Changes in location tracking will not affect most website actions, but they can influence the attribution for individual channels.

That means aggregators will only be able to rely on last-click attribution. It can also confuse website traffic data. The data might show an increase in the number of new visitors on a website even when most of them were returning users.  

Implications on Ad Tech and Advertisers

With the new iOS 14 update, it will become increasingly difficult for ad tech vendors to form insights on profiles of iPhone users based on the traffic pattern. It will also become difficult for advertisers to use location-based targeting.

Without access to third-party cookies and IDFA, app developers will not be able to offer targeted solutions to advertisers. Therefore, suppliers and ad tech vendors must find other ways to encourage iPhone users to opt-in and subscribe so that they can gather first-party data. Advertisers will also have to modify their reach and frequency management.

The latest iOS 14 update may not make things easy for advertisers. However, they can use intelligent planning to adapt and evolve to reach out to people concerned about their privacy. It might take some time to learn and adjust new methods, but in the end, it would probably benefit both advertisers and consumers.