iOS 14 & IDFA & Attribution: A Global Change in the Mobile Advertising Market

A short summary of the key changes and implications of iOS 14 release and limiting default access to IDFA

# 1 Access restrictions: In iOS 14, IDFA will only be accessible upon user permission.

  • As iOS 14 takes over (users will be gradually updating their devices to a newer iOS version with a IDFA), the cost of user acquisition will increase. The key factors here will be a lower quality of attribution and limited access to ad-targeting tools like lookalike audiences and retargeting.
  • Companies that provide attribution services will find themselves in a difficult position. Prior to iOS 14, they held a central position in the mobile advertising market. Without these companies developers wouldn’t be able to run mobile marketing efficiently. Apple’s decision will shatter their positions in the market. And there’s a possibility that Google will follow suit.
  • Large ad networks will also suffer. In its latest report, Facebook has already declared that it sees the changes in iOS 14 as a risk to its advertising business. Google, Twitter, Snapchat, Tiktok, and other big players have voiced similar concerns.
  • It will become even more difficult for small players to compete with large publishers on the mobile market. They will lose the ability to accurately calculate ROI for ad campaigns. Without the ability to precisely link users’ payments to ad campaigns, it will be impossible to calculate the profit from acquired users. For small players, ineffective marketing can be a disaster, and many will have to be much more careful or even abandon paid channels. Big players have greater error tolerance and more tools to solve the emerging problems, although the problem will be no less relevant to them. Due to this asymmetry, it makes sense to expect an acceleration of the consolidation process on the mobile market.
  • How traffic attribution currently works for mobile apps and why IDFA is so important?
  • What exactly will change in iOS 14?
  • What is the alternative Apple is offering to replace IDFA and existing mobile traffic attribution mechanisms?
  • Why do we expect an increase in user acquisition costs?
  • What do the leaders of the mobile market say?
  • When can we expect this change to take place?
  • How to prepare your app for iOS 14?
  • What will be the broader implications for mobile advertising and attribution?
  • How traffic attribution currently works for mobile apps, and why IDFA is so important?

How traffic attribution works for mobile apps

Traffic attribution helps find out where a particular user came from. This is a critical task for performance marketing, as without high-quality attribution, it is impossible to determine which advertising campaigns are profitable (i.e., are making money) and which are not.

  • The app developer has to integrate the SDK of a mobile attribution service into the app to track the traffic source of new users. Examples include AppsFlyer, Adjust, and Kochava.
  • The developer purchases ads in the advertising network, while using special links from the traffic-tracking service (Appsflyer, Adjust, etc.).
  • After clicking on the ad, the user is redirected to a special page, where various information is collected about him, including IDFA and his traffic source (it is transmitted from the advertising network, while access to IDFA is limited on the web). The user is then redirected to the app’s page in App Store or Google Play. Users will see none of this happen.
  • When a new user launches the app for the first time, the information about this action is sent to the mobile attribution service (AppsFlyer, Adjust, Kochava), which tries to find a match between the data received and the data collected at the previous step. If there is a match, then this user is attributed to the corresponding ad campaign. Absent a match, the traffic is considered organic.
  • The developer must set up a postback from a partner to the ad network, so that the ad system understands which campaigns are working well and which are not, and can optimize the display of ads on its side.
  • In some ad networks, the logic differs slightly. For example, the logic is different for Facebook, which is directly integrated with Appsflyer, Adjust and other providers.

Why IDFA is a central element of mobile traffic attribution

As is evident in the process described above, data about users who click on ads is key to the logic behind mobile traffic attribution systems. The IDFA is the central element of the data collected, and if IDFA is missing, the accuracy of this attribution method will drop dramatically.

What is fingerprinting in attribution

Fingerprinting is a way of obtaining a device ID from a set of indirect attributes. As indirect signs, you can consider such things as the operating system’s version, IP address, operator, time and some other parameters. This identifier should make it possible to tell different users apart and remain unique to each user if possible.

What exactly will change in iOS 14 release

At WWDC 2020, Apple unveiled a new operating system, and at the same time “delighted” the iOS app developer community that now IDFA won’t be a default feature any longer. Instead, the user will control IDFA access for each app by responding to a native popup inside the app. The design might change but the idea will remain the same.

What is the alternative Apple is offering to replace IDFA and existing attribution mechanisms?

Apple has also presented its own attribution method to the market. To do this, the company created the SKAdnetwork privacy-friendly attribution framework, which allows you to transfer data to advertising networks without violating the privacy of a particular user.

  • The maximum value is 64 and can only be whole numbers. Thus, you can send 64 types of events with a weight of one, or send a value from 1 to 64 in one event. The advertising network decides how exactly to interpret the value.
  • There is a 24-hour window to send/add to the value.
  • If a value rises, the timer is reset.

With the release of iOS 14, we should expect an increase in the cost of a user acquisition

Retargeting and lookalike won’t be practically available.

IDFV

In addition to IDFA, iOS has another identifier — IDFV (identifier for vendor). This identifier remains the same across apps from the same developer, but it differs for different publishers. Therefore, ad networks won’t be able to use it to define a user within the attribution task.

What Mobile Market Leaders Say:

Among the major players in the attribution market, Adjust has been the most vocal about the situation. One of the company’s proposals to Apple is to use IDFA locally on the device for hash counting. The hash is computed using the SHA256 algorithm on the combination of IDFA and IDFV strings. It is transmitted to the server along with the IDFV. Then, the MMP (traffic attribution service) gets the IDFA from ad networks and does the search. If something matches the hash from the device, then attribution takes place.

  1. This solution will not anonymize the user data, which means it contradicts Apple’s privacy policy.
  2. This solution still requires IDFA consent (although Adjust probably assumes that in this case neither the developer nor the advertising system receives an explicit IDFA value).
  3. Enumerating hashes is an inefficient computational scheme that requires a lot of resources and time.

When we can expect these changes

iOS 14 will be released in early 2021.

Getting ready for iOS 14

Adjust has released an excellent guide on how to get your app ready for iOS 14, starting with understanding which third-party services and SDKs in your app are using IDFA.

What changes to expect in the mobile advertising and attribution market

The global mobile advertising market size stands at 80 billion USD, so we shouldn’t expect it to die or somehow shrink significantly. Companies will continue to acquire users for their mobile apps through paid ads. The question is, how efficiently will they do so? First, it will be more difficult to measure the effectiveness of campaigns. Second, lookalike audiences and retargeting will practically stop working.

  • If an analytics service the app uses transfers data to an ad network, do you need to ask permission for tracking?
  • Will Apple Search Ads attribution continue to work through the internal iAd framework?
  • What new function will MMPs perform and will they remain? Will Apple categorize them as ad networks so they can get attribution data?
  • Will Apple exempt any ad networks from getting user consent before using IDFA?

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Oleg Yakubnekov

Oleg Yakubnekov

I am a product and data guy with experience in building and growing things at scale. Forbes 30 under 30