Apocalypse Now: per WWDC, the IDFA is dead

At Apple’s WWDC event yesterday, a number of new privacy features were unveiled that will be rolled out to iOS 14 later this year. Among those — and most relevant to direct response marketers — is the AppTrackingTransparency framework, which requires an app to explicitly request a user’s permission before accessing their device’s IDFA, or unique mobile advertising identifier. If the user declines to grant an app access to the device IDFA, the user will appear to that app as if they have Limit Ad Tracking turned on:

Additionally, iOS 14 will introduce a “privacy dashboard” of sorts that will allow users to understand the information that various apps are tracking for them. Presumably, users will be able to revoke access to this data from the privacy dashboard, even if those apps had been previously given access to it:

And finally, Apple has introduced changes to SKAdNetwork, Apple’s app install attribution API that I wrote about back in 2018, that will make it possible to determine from which app a specific install campaign delivered a user.

These changes represent a seismic shift in the mobile advertising ecosystem. Mobile advertising, and specifically app install advertising, will fundamentally change with iOS 14.

In Apocalypse Soon, I predicted that Apple would announce at WWDC 2020 that LAT would be turned on for all users by default, and that a Certified Mobile Advertising Partners program would emerge that allowed advertising platforms to participate in a direct attribution system via SKAdNetwork. From the article:

At this point, advertisers begin to get a clearer picture of the future of mobile measurement and the severity of the changes being instituted. If attribution is handled directly from iTunes and doesn’t include user device identifiers, then the impending new reality of advertising dictates:

– ROAS and CPE campaigns will only be possible via the SANs that are able to do any form of fingerprinting via their proprietary SDK data and the revenue data they collect;

– Cost Per Install values for campaigns from the networks in Apple’s Ad Partners program are calculable, but building effective ROAS models for these campaigns will be difficult, if not impossible. Without being able to attribute revenue to campaigns (because all IDFAs are zeroed, and SKAdNetwork transmits no identifiable user information), the traffic sources of monetizing users are unknowable;

– Most of the infrastructure currently supporting mobile advertising will soon become obsolete.

In Why is Apple Building an Ad Network?, I posited that Apple’s motivation in making the changes I predicted in Apocalypse Soon could be to capture some of the predicted $240BN market for mobile advertising in 2020 by giving itself a privileged position relative to other ad platforms if device-level tracking was no longer possible:

When it launched, the general sentiment from advertisers toward ASA was that it would be a minor component of overall traffic and, in some ways, serve as a tax on App Store discovery (advertisers use ASA to bid against their own keywords so that competitors can’t poach organic installs). I rarely see the advertisers I work with spending more than 5-8% of their overall budget on ASA given its limited reach, but that is changing with these new placements. If Apple grows ASA into a bonafide ad network, and especially if Apple does deprecate its advertising identifier, Apple could propel ASA into the top echelon of mobile app install advertising platforms.

And in Media mix models are the future of mobile advertising, I explained why deterministic app install attribution as a paradigm needs to be replaced by probabilistic models that don’t require direct, per-install measurement:

The notion that measurability is exclusively a function of attributable clicks has been evaporating for years, hastening for the aforementioned reasons, and yet user acquisition teams have persisted. The demise of advertising IDs won’t precipitate the demise of user acquisition on mobile, since the deprecation of advertising IDs will simply take a trend that already exists — of decreased reliance on click attribution in a shift toward more holistic, macro-level measurement — to its logical conclusion.

These changes are happening now. It seems unrealistic to think that more than 10% or so of users would opt into being tracked via IDFA, even if (as per Apple’s documentation) advertisers have the ability to craft the message that is exposed in the opt-in dialogue box.

With this change, Apple effectively kills the IDFA and pushes app attribution to SKAdNetwork. Advertisers must reckon with the consequences of those changes for their business.