An Unhappy Apple Anniversary For Those Dealing With App Tracking Transparency
The study was conducted by Kinshuk Jerath from Columbia Business School, who serves as a professor of business in Columbia’s Marketing Division.
The goal of the study is to change perceptions that have circulated about the impact of Apple’s ATT change. For instance, Apple argues that its first-party Search Ads business “grew for a variety of reasons unrelated to ATT, and that it does not affect the apps’ ability to collect and use first-party data.”
Apple says its Search Ads business, according to the study, is relatively new, adding that “in a fast-growing space, certain app categories grew substantially in 2021, and it launched in a large market (China) in 2021.”
The study shows that the growth of ads in certain app downloads categories grew by 19% in 2021, fueled in part by growth in crypto app downloads that were estimated to have grown by 560% in 2021.
“The surge in demand for finance apps led advertisers to spend nearly $3 billion globally in app install advertising in 2020, and the spend in 2021 was estimated to be substantially higher,” according to the report. “This growth is also reflected in the increased cost of advertising for finance apps.”
Apple also argues that sports betting apps grew in downloads by an estimated 177% year-over-year as of Q3 2021, which led to growth in sports betting advertising, with an estimated 29% of all ad spend for this category going to digital formats.
Apple says users have a choice whether or not to turn off personalized ads in apps. This might give advertisers the perception that Apple Search Ads may be somewhat less effective, and prompt advertisers to decrease ad spend on Apple Search Ads.
Countless companies have made changes to their strategies and added services to support Apple’s change. Many have released data, alongside comments from industry executives detailing various perspectives.
Some industry experts have a different perspective than Apple. Jake Moskowitz, vice president of data strategy at Emodo, an Ericsson mobile ad-tech business, believes that Apple created the first massive paradigm shift, removing the one-to-one-based targeting and measurement, and now Google’s plans for Chrome and Android to remove opt-out tracking mechanisms will “spell the death knell for the way we’ve used digital for the last 15 years.”
Lotame analyzed the 2022 revenue impact of Apple’s privacy changes, and estimates that the Identifier for Advertisers (IDFA), a random device identifier assigned by the company to a user’s device, will have a total impact on four companies of about $16 billion — up 9% from previous estimates. Those four companies include SNAP, Facebook, Twitter, and YouTube.
“The impact on measurement has been fairly devastating,” wrote Mike Woosley, COO at Lotame. “Apple uses the cover story of ‘privacy’ to make these changes, but in reality, Apple is infuriated by any opportunity to monetize traffic on its devices without its direct involvement.”
Ivan Markman, chief business officer at Yahoo, believes the deprecation of the IDFA or any other identifier has never really been about privacy. “It has also been about technology titan plays to gain an advantage in the next generation of hardware, content and advertising,” he wrote.