The Shifting Paradigm of Data Privacy: What You Need to Know
You’ve read the press releases, you’ve seen the full page ads, but you may still be asking yourself: what’s actually happening with the future of data privacy?
To put it mildly: a lot.
Between Google preparing to sunset the third-party cookie, and Apple’s recent slate of software updates–including iOS 14.5 and iOS 15–users have more transparency and autonomy than ever before into how their personal data is collected and shared. These data privacy changes have given consumers considerable control over the information third parties can collect and use for marketing purposes.
These are well overdue protections for individual consumer data, but if you’re a marketer who relies on hyper-relevant targeting to efficiently reach your core audience, your job just got a whole lot more complicated.
The audience granularity you’re used to has effectively disappeared. With decreased targeting capabilities, you’ll need to reframe your positioning and creative approach to appeal to a wider audience while still driving action.
Not sure what to do about it? You’re not alone. Here is the high-level info you need to know about the disruption caused by Apple and Google’s data-privacy changes.
Learn More: Social Media Video Ad Specs & Placements Guide
Data Privacy Changes: The Facts
Apple Makes Waves
Apple changed the digital ad game when its iOS 14.5 update went live in early Spring 2021, requiring the world’s 900 million iPhone users to opt-in to sharing data across the apps they have on their phones and tablets. They continued to innovate on these privacy solutions with iOS 15, which was released in the Fall of 2021.
With iOS 15, Apple updated its Intelligent Tracking Prevention feature, now allowing users to block their IP address from trackers on Safari. The device manufacturer also introduced Mail Privacy Protection, allowing users to block their IP address when using Apple’s Mail app, as well as prevent email senders from tracking engagement behavior (i.e., email opens). Further, Apple’s new App Privacy Report tells users exactly how their information is used when they choose to share data. These changes are significant and not to be overlooked, but for most marketers, the most impactful update came first with iOS 14.5’s introduction of App Tracking Transparency (ATT).
ATT requires user authorization before any app can collect data that is then shared with other companies for purposes of tracking across mobile apps and websites. In past versions of iOS, users had to opt-out of data tracking and sharing by manually going into their settings. This new feature simplifies the process through a pop-up notification whenever a new app is opened that explicitly asks the user whether or not they want to share their data.
What this means is that whenever someone uses an app on an iPhone or iPad today, they will have to give the developer express permission to access their IDFA, or Apple’s Identifier for Advertisers. What the IDFA does is track a user’s activity across different apps on a person’s iPhone. If you’re a marketer who relies on data about your core consumer’s interests to build audience cohorts, you can probably guess how this will impact your job.
Let’s explore this issue by using Facebook marketing as an example. Say, for instance, someone who loves collecting sneakers opts-in to sharing their data with the social media app. Facebook would be able to take that user’s information and put them into an audience segment for targeting purposes composed of consumers who often buy a lot of sneakers on mobile eComm sites, visit popular shoe brand’s websites on their iPhone, or read blogs on sneaker culture on their iPad—providing marketers with an audience that is very likely to buy sneakers from an Instagram video ad.
But because only a fraction of users are actually opting-in to data tracking on iPhones–approximately 6% across the United States–the data required to build these audiences are inaccessible. Furthermore, Facebook’s ability to accurately track conversions (purchases, leads, website visits, etc.) attributed to an ad served across its ecosystem is significantly limited by ATT. Every time a user opts out of allowing Facebook to track their mobile behaviors across apps, the ad platform loses the ability to track subsequent actions taken. This leaves marketers in the dark about precisely which campaigns are performing best–and worst. Facebook is implementing their own solutions to circumvent these targeting, measurement, and attribution issues, but as they are in their infancy, they don’t yet have the precision marketers crave.
Does Facebook still have first-party data they can leverage on their own ad platform? Sure, but again, it lacks the robustness of third-party data. Facebook may be able to create an audience of sneakerheads based on people who follow influencers on Facebook or sneaker fan accounts on Instagram, but this isn’t as effective as third-party data. Think about it: just because someone follows an account about limited-edition sneaker releases doesn’t exactly mean they can always afford their pricey hobby.
The Great Data Privacy Debate of 2021
These changes have fueled the beef to end all beefs between Facebook and Apple. When Apple launched its Privacy Nutrition Label, it made available a detailed list of every datapoint that an app tracks. And as Mashable pointed out, Facebook has a “comically long” list of data it collects. It’s eye opening to say the least.
During a presentation at a conference for data privacy, Apple CEO Tim Cook said, “if we accept as normal and unavoidable that everything in our lives can be aggregated and sold, then we lose so much more than data. We lose the freedom to be human.” Cook’s statement can be interpreted as hyperbolic fighting words, but it doesn’t make it any less true. Apple wants to make data protection an inalienable right. Ultimately, users should have the freedom to choose whether or not they give out their personal data.
But it could have unintended consequences, especially for small business owners, which is how Facebook has framed its resistance to Apple’s changes. Mark Zuckerberg took out a series of full page ads in major newspapers to express his frustration and explain Facebook’s opposition. At the core of his argument is that by decreasing Facebook’s ability to collect data about its users, small businesses will have a harder time reaching new consumers. They claim that “the average small business advertiser stands to see a cut of over 60% in their sales for every dollar they spend.”
While Facebook has led the charge against iOS14’s privacy opt-in clause, it’s good to note that not all social channels, like Twitter, feel this change will greatly affect how ads on their platforms operate. It should also be noted that, since iOS14 is an operating system exclusive to Apple products, Android phones and tablets will not be affected by this change. That’s great news when you consider that of the 5 billion mobile users worldwide, 75% of them are on an Android phone. And it seems more and more ad spend dollars are shifting over to the Android market.
Google Says Buh-Bye to the Third-Party Cookie
Apple’s iOS updates have dramatically impacted how advertisers target mobile users, but Google’s parallel phase out of third-party cookies on Chrome will cause a major shift in tracking anyone who uses the browser on both mobile and desktop.
If first-party cookies are codes that track a user when they visit one website, a third-party cookie is a code set by a separate domain that tracks a user across multiple websites. This collected data gives marketers a robust user persona so brands can target potential consumers with advertisements based on their wants and needs.
Popular web browsers like Safari and Firefox have already blocked the third-party cookie, but Chrome accounts for more than half of all global web traffic. When Google’s changes go into full effect in 2022, the seismic impact of the third-party cookie’s demise will be profoundly felt across the internet.
What does all this mean for your brand? Well, it’s going to be a lot harder for marketers to target and track specific audiences across most devices and platforms. Brands that rely on a single platform today will need to diversify to stay ahead of the turning tide of data privacy. But as the old saying goes, in the midst of every challenge exists opportunity.
Data Privacy Challenges = Marketing Opportunities
What does all this mean for your brand? Because it’s going to be a lot harder for ad platforms to track users across most devices, apps, and browsers, marketers will have much less precision when it comes to audience targeting and measurement—two of the most important advertising campaign optimization levers.
With these two levers effectively muted, what do you have left to work with? Your budget strategy, and your creative assets. But hey, we’re marketers, we know the last thing any of our bosses want to hear is “Just spend more money!” So really, what does that leave you with? Your new everyday hero: ad creative.
With restricted access to data, agile marketers will need to wade through murky digital waters with your ad creative to find their target audiences. But you can find clarity in this storm of changes by refocusing your efforts on performance marketing. The key to the future of harnessing data about your audience will be dictated by creative testing.
First, prioritize platform diversification. Since you won’t know exactly what apps or websites your target audience interacts with, prepare to cast a wider net to meet potential audiences wherever they exist.
Some users are platform-loyal, but the vast majority of consumers are scattered across a number of platforms. Lean on demographic learnings from the years before these privacy changes to retain a general idea of what audiences exist on which platforms. As we gain more insights over the coming year into the new normal of audience targeting, this archival data will be important as the advertising industry adjusts to this tracking transition.
More important than platform diversification, though, will be the need to create and launch multiple versions of your ads–especially video–to simultaneously test different variables, like value props. Creative testing will quickly surface what works with the audience you’re aiming to reach.
With granular tracking and conversion reporting disappearing soon, creative testing can methodically reveal key audience behavior trends. As you methodically test iterative creatives, you home in on the variables that resonate most with your target audiences.
Harvesting Data with a Multivariate Creative Testing Plan
You can support your creative experimentation by launching a multivariate testing plan. This strategic approach turns trial and error into methodical assessment, zeroing-in on the creative variables that work best for your brand.
- Start by identifying your goals and collecting any historical learning you have. Having a robust understanding of your brand’s historical performance ensures that you’re not starting from scratch when structuring your testing plan.
- You want to then identify several concepts and creative attributes that you’ll methodically test. You’ll use these concepts to build an exhaustive shot list so you can capture all the necessary footage in one shoot.
- After your shoot, edit together your first set of creatives and launch your campaign. Test broadly so you can identify the creative variables that resonate the most with your target audience, and iterate on them. This will help you optimize your current campaign, and provide audience learnings to carry into your next one.
If this all sounds expensive, it really doesn’t have to be. At QuickFrame, we strategically plan out a testing approach, so you learn who your customer is and what motivates them based on the creative variables that perform best. We do this for every platform and without blowing your budget.
With thorough pre-production planning and a clear testing strategy, you can maximize your budget and generate dozens of platform- and placement-specific iterative video assets in a matter of weeks. That’s right: you can generate strong campaign performance and collect valuable customer insights, all in a privacy-friendly way.
The Shifting Paradigm of Data Privacy: The Takeaway
Frankly, everything you’ve read about the impending data privacy updates is conjecture. While sensational headlines like “the death of the third party cookie” or Apple “killing” the IDFA grabs our attention, the doom-and-gloom that’s being preached really isn’t all that doomy or gloomy. Cookies and the Identifier for Advertisers aren’t going away; platforms are just offering users far more transparency on what happens to their data than ever before.
Most importantly for marketers, targeting opportunities will still exist. It’s just now consumers must choose to be targetable, rather than not.
The truth is that we don’t really know how this will affect consumer behavior. Trust us, it will create a ripple effect across the digital sphere, but to what extent is yet to be determined.
Will opting-in become synonymous with reading through the terms and conditions of a product; something we know we should read in full, but mindlessly agree to so that we can get to enjoying the product faster? Consumers may see retargeting ads tailored to their interests to be invasive, but what will happen to their buying habits when they have to seek out new products rather than those new products coming directly to them?
These changes will likely make the highly saturated content landscape of social media even more competitive, so marketers will need to think strategically to break through the noise and make a mark. As we navigate the new normal of data privacy, go all-in on creative testing. It’s set to be the privacy friendly solution to serving up audience-specific content that will make the greatest impact on your audience.
GET CREATIVE DATA: Performance Marketing Multivariate Testing in 7 Steps
Do More with Video
Learn how we can help you produce more quality videos affordably and at scale.