Apple's iOS 14 privacy updates have made a drastic impact on audience targeting. App developers are now required to notify users about collecting their personal information. This means advertisers now have significantly less ability to target individuals on Apple devices and send them personalized ads. With the privacy updates limiting audience targeting capabilities on iOS, how can marketers successfully reach consumers?
While these updates are an absolutely necessary boon to personal privacy, they've triggered fear in marketers everywhere. If you're curious as to how the industry at large feels about this, look no further than Twitter.
It's clear that advertisers are desperate for a solution. But marketers who are trying to fight the latest changes by looking for other ways to track buyers are going about it the wrong way. Regulators will get these marketers one way or another. Meaning those marketers who adopt a new system to track audiences differently will eventually be looking for another new solution in six to 12 months.
The smarter method is to find alternative paths to performance that don't rely on exploiting audience data — paths that focus on what will always be within a marketer’s control. There are two, in my book: contextual advertising and better creative.
Contextual advertising serves relevant ads with content about or tangential to the ad's subject. For example, suppose you’re selling diapers and trying to reach new parents. If there's an article or Reddit thread about how to change a baby's diaper, you can be confident that a sizable portion of that web page’s audience is new parents. With contextual advertising, you're tracking content on the Internet to find where your audience would most likely be, based on their interests or characteristics, instead of specifically targeting the audience. Contextual ads run alongside the content made with your audience in mind.
Contextual advertising is a big industry that's existed for a while, with companies like DoubleVerify, IAS, and MOAT specializing in this field.
With the updates to iOS 14, contextual advertising has become much more pressing. These companies went from being worth around $500 thousand to $5 billion. (DoubleVerify actually went public recently because of the iOS 14 updates and their impact on the ecosystem.) So these companies’ values have increased 10x strictly because of the iOS 14 news and the resulting tidal wave of demand.
Before the advent of iOS 14, advertisers could understand a single customer’s purchase intent based on past browsing and purchase data. For example, if I can see the past five purchases that you made on your Amex card, I can predict with reasonable certainty what your sixth purchase will be. I already know what you're likely to buy because I'm tracking all of your browsing and purchase data.
Now, in a world where I can't predict the products or services people are going to purchase, I need to market to a much wider audience. Most of that much wider audience will not have that high a level of purchase intent. This means my ad creative must be more compelling and relevant than ever before to inspire a purchase.
To build predictably better creative as a path to performance, advertisers need to abandon the old creative workflow that goes into developing creative assets, including arbitrary tastemaking and guessing. Instead, advertisers must apply the same analytical rigor of audience targeting to creative testing — designing modularly, isolating variables, and testing at scale. It’s in this way that the updates to iOS 14 will make creatives function more like scientists and engineers, finding out which ads work well and why, so they can replicate those results moving forward.
While iOS 14 and the resulting updates to Facebook have sparked a welcome shift toward greater user privacy, it has rendered audience targeting an unreliable form of data. To evolve toward growth in this new era, marketers and advertisers must focus on what they can control — the conversion power of their creative.