February 19, 2021

iOS 14 vs. Social Media Advertising | What It Means for Your Business

Every generation needs a great “versus” narrative. Greece vs. Troy, John Henry vs. The Machine, Rocky vs. Apollo, Jim vs. Dwight. You get the picture.

And, with Apple’s newest iOS update and the rollout of Apple’s newest policy, App Tracking Transparency (ATT), we have a new versus for the ages – the battle of the tech giants: Apple vs. Facebook Ads.

This article explains the changes this new policy brings for small to medium-sized businesses that advertise on social media and discuss how you, the small business owner, can best prepare while the tech giants battle it out.

iOS Who? What’s Happening?

In short, Apple recently updated its operating system, iOS 14.5 (including iPadOS 14.5, tvOS 14.5), which allows users more control over how they share data and who they share it with. 

In what may be the biggest change to data privacy to date, Apple is putting the control of data collection back in the hands of app users and giving them the option to “opt-out” of sharing their data when using apps like Facebook, YouTube, Instagram, and Twitter.

While it is definitely indicative of larger things to come (i.e., will Microsoft follow suit? Android?), this update is simply one company’s proactive response to what have been years of discussion around privacy concerns and, moreover, the power held by certain tech and social media companies. 

So, What’s the Problem?

While almost everyone would agree that an increased focus on data privacy and digital security is a huge step in the right direction, this change, like all changes, does have its share of detractors — particularly those who are interested in giving businesses more ability to target their customers and personalize their advertising. 

Facebook, for example, claims that this change will inequitably harm small to medium-sized businesses in a time when many small businesses are already feeling overwhelming pressure. By taking away one of the key tools small businesses have found to survive the pandemic, Facebook believes Apple is forcing the hand of business owners to expand their own business interests. 

On the other hand, Apple says that apps on their App Store should be held to a higher standard for privacy and security because nothing should be more important than maintaining their users’ trust. 

So, there you have it — the root of this battle. In the white corner, represented by iOS 14 and fighting for consumer privacy, we have Apple, and in the blue corner, representing the free market and fighting for small business advertisers, we have Facebook (and other app-based advertising platforms).

What Are Social Media Companies Doing About It?

In a word — complying. 

Most social media platforms understand the relationship their product has with the Apple App Store. Even a company like Facebook, which has a large international presence and only relies on about 15% of its users from iOS, knows it’s best not to poke the bear. 

If they do fight back, they face retaliation from Apple, which, at worst, could be detrimental to their business and, at best, could negatively affect a large portion of their users. 

While companies like Twitter have expressed concerns about the loss of ad revenue due to the update, most social media platforms are making the changes necessary to fall in line with Apple’s new policy. 

Here is how Twitter is preparing, here is Facebook’s Plan, and here’s how Google is helping you prepare. We’ll continue to update this list as more companies release information and publish their recommendations.

What Can Small Business Advertisers Expect?

If only we had a Magic 8-Ball that could definitively answer this question. Unfortunately, the best answer is: only time will tell. 

What we can expect are changes to all of the apps on our iPhone, iPad, and Apple TVs moving forward. Soon, apps will begin to prompt us with a message asking whether or not we agree to allow our data to be collected or not. This corresponds with the “data nutrition” labels we began to see earlier this year, requiring all app developers to submit how their application collects and utilizes data from their users.

It seems pretty intuitive that, when prompted, the average person is going to choose not to share their information, and the implications of this change will likely be felt most by people who rely on data from these apps for advertising purposes. 

What does this mean for a small business that currently utilizes Facebook or other social media platforms to advertise? Well, it means a few things.

First, expect a decrease in your targeted audiences both on Facebook and in its broader Audience Network. If you utilize data collected from Facebook app users to target your advertisements. such as location, age, or interests, you may need to broaden your aim to ensure the same sized audience in the future.

Additionally, expect gaps in attribution. For example, if a customer becomes aware of your website via an app on their iPhone (that they’ve opted out of tracking), but then comes back later on their desktop and converts. It’s probable that their first experience with your business will not be tracked or attributed to their purchase.

Next, expect delays in reported data. As part of the new policy, real-time reporting will no longer be supported, and businesses could see a delay of up to three days.

Lastly, expect limitations to ad creation. When creating new ads with app users in mind, there will be restrictions on buying options and your ability to bid for certain metrics. 

To read a full breakdown of how Apple’s iOS 14 release might affect your ads and reporting, check out Facebook’s Help Center post on the subject. 

What Does This Mean for the Future? 

All that may seem insignificant, and, at the moment, it might just be. But, as stated previously, this should be viewed as the start of a much larger movement away from the way we utilize user data for advertising. 

In the short term, it may make it harder to target specific customers, or track events from mobile, social media users, or accurately attribute conversions. But, assuming a broader appeal in the future, this small step could spell a significant shift in the marketplace. 

For instance, Facebook anticipates that this change will have dramatic effects on its audience network (its major targeting engine). If it does, it’s not hard to envision a future where companies like Facebook choose to do away with that feature altogether, creating a lot less parity in the market and giving power to larger companies with larger budgets, who can afford to be less targeted — not too dissimilar from the heyday of TV advertising.

What Can Small Business Advertisers do to Prepare?

Start auditing your current advertising campaigns and identify the ones in which detailed targeting matters most. As we begin to lose consumer data, we may need to adjust these campaigns to maintain the same returns they did in previous years. 

To better comply with Apple’s policy, companies have made changes to their internal systems as well. Do your research on how the companies you advertise with are preparing for these changes. For instance, moving forward, Facebook will only allow you to track a total of eight conversion events. If you currently track more than this, it would be wise to pare this down to the conversion events that really matter most. 

Regardless of where you “weigh-in” on the Apple vs. Facebook debate, if Facebook is right, these changes may hit the small business market the hardest. As a small business owner or marketer, you’ll want to ensure that your company is prepared for the changes coming to the advertising platforms you utilize. At PHOS, we are passionate about helping small to medium-sized businesses and stay on top of these changes to identify the best ways to address them. In doing so, we can help you plan for these changes and ensure your campaigns are built to the highest standards of privacy and security while remaining effective for your business. 

Chad Wolcott

Chad Wolcott

Chad utilizes his diverse background in sales and marketing to help our customers win. As an Inbound Marketing Executive, Chad marries his love for telling incredible digital stories and his strong focus on results to help clients increase the metrics that matter. As the son of a successful small business owner, one of his greatest passions is serving the local business community.

When not in the office you’ll find Chad spending time with his family, volunteering at church, or in the “woods and water” around Gainesville with a fishing pole, kayak paddle, shovel, or maybe even chainsaw in hand. Chad has a love for the outdoors and would love to talk your ear off about subjects like horticulture and agroforestry, if prompted.