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Why Apple Is Stifling Ad Tracking and What Can Be Done About It

Why Apple Is Stifling Ad Tracking and What Can Be Done About It

October 25, 2016

Apple has always been a leader in digital-age technology, often making controversial design decisions and introducing features to which the rest of the world adapts. The iPhone’s touch-screen keyboard, for example, met a skeptical reception at first, but users grew accustomed to it, and now it’s a staple feature for most mobile devices.

So when Apple introduces a new user-friendly feature that takes value away from advertisers, the latter have to wonder: Is this really the best path forward? Is this going to benefit everyone in the long run, or is it a misguided attempt to improve user experience at the cost of advertising potential?

That’s exactly the scenario with Apple’s latest software update, iOS10, which has introduced a new limitation for ad tracking that has advertisers scrambling everywhere.

Limit Ad Tracking in a Nutshell

To get started, you first have to understand what limit ad tracking (LAT) is. Here’s a brief description. Ever since iOS 6, which came out in 2012, users have had the ability to opt out of interest-based advertising.

By accessing the settings in their device, whether it’s an iPad, an iPhone, or anything else that runs the software, users could flip a switch and immediately turn off any ads that are presented to him or her based on criteria such as search history, previous behavior, or previous purchases. Users who enabled this feature would still see the same number of ads, but the content would be more randomized (and therefore, less relevant).

LAT was a slight blow to advertisers, who could no longer reach certain relevant audiences with richer, more detailed user information, although some information was still available to them. Vendors and advertisers could still gain access to device IDs, for a number of different functions:

  • Frequency capping. With a device ID available, advertisers can limit the number of times a specific user sees a specific ad when visiting a site, which hypothetically keeps the ad as relevant as possible for the greatest number of users.
  • Attribution. Device IDs also enable vendors and advertisers to see where their customers are coming from, which is valuable information when it comes to measuring advertising effectiveness and optimizing a campaign.
  • Debugging. If something goes wrong with the display of an advertisement, the device ID can help developers pinpoint the nature of the problem and make a correction so it doesn’t happen again.
  • Fraud detection. Keeping tabs of users’ device IDs means there’s a lower likelihood of getting away with fraud.

These were extremely helpful features, but the latest update has put them all in jeopardy.

The Latest Update

As a result of the latest update, iOS10, any user who activates the LAT feature will now have their device ID replaced by hashed identifiers—a string of zeroes—that blocks them completely from being tracked by advertisers or vendors. This is problematic, because any user who has already opted out of interest-based advertising will now become essentially invisible to tracking via the device ID, and that renders all the above benefits inaccessible.

Just How Far Does the Problem Go?

Before you grow concerned that your advertising campaign isn’t going to be effective anymore, let’s take a step back and look rationally at the problem. How deep does it really go? What effects is it really going to have?

  • Limited population. First, understand that not all users are going to opt out of this feature. As a matter of fact, at the time of this writing, only 15 percent of Apple users have opted out of interest-based advertising, which means you’ll still be able to access device ID data for 85 percent of your target users in this area.
  • Ad relevance. It’s also important to understand the rationale behind opting out of interest-based advertising in the first place. The types of users most likely to opt out of these ads are ones who care about their privacy, and don’t engage with ads regularly. In effect, they’re some of the least valuable users you could target—so losing their information isn’t such a great loss.
  • Playing by the rules. If it weren’t for Apple, you wouldn’t have access to these platforms or this information in the first place. The unfortunate reality is that companies like these have the power, and they get to make the rules. If you want to continue reaping the benefits, you need to play by those rules.
  • Potential growth. One reasonable fear that stems from this development is the possibility that it’s not the end. If Apple is limiting this type of user information, it may choose to limit more data, or even limit user information by default in the future. This seems like an extreme possibility, but some escalation is certainly reasonable to expect.

Alternatives and Workarounds

What alternatives or workarounds are available currently? How can vendors and advertisers start to compensate for this latest change?

  • Don’t rule out the possibility of moving on. Device IDs provide a lot of valuable information, but they’re being blocked for non-engaged users, and only a fraction of the total population. It may not be worth seeking an alternative solution at all.
  • As Michael Oiknine of Apsalar points out, one key potential alternative could be a roundabout way of uncovering user information known as fingerprinting. Fingerprinting makes use of non-PII signals to tie installations to marketing scenarios or vendors that initiated them. This allows similar types of measurement without any kind of intrusive third-party user profiling.
  • You could also use a type of vendor tracking identifier to turn the tracking process on its head. Here, you’ll track downloads and installations based on signals from individual vendors.
  • iOS10 is still new, and advertisers are still navigating the unknown waters. It will be some time before a more practical solution is developed to replace device ID tracking fully, so it may be in your best interest to wait and see what other strategies surface. If you’re creative enough and have the programming talent, you could probably invent your own solution as well.

If you’re interested in getting more out of your advertising campaign, or simply learning more about the alternative options available to you now that iOS10 is out, contact us at Verta Media. We’ll help you find the advertising solutions you need to remain effective in the digital age.