How should marketers adapt to new privacy measures such as ATT, and what now for personalisation?

“Platforms will group user behaviours into target segments (e.g. Google’s FLoC). This allows for media to be targeted enough to still be relevant, but not on a 1-2-1 basis like we’ve seen historically with third party cookies,” he says. “Ad personalisation will evolve because of privacy, moving away from the user-centric approach to focus more on larger audiences. This is an opportunity for advertisers to adapt their message, leveraging the user’s context to maximize their ad impact. I also believe that ad interactions will play a greater role in the future, enabling personalisation in real-time.”
Shamsul Chowdhury, VP of Paid Social at Jellyfish suggests that ad performance will inherently drop (due to fewer signals from users). Consequently, he says, “this will lead to advertisers toggling their delivery between the Facebook platforms – Facebook, Instagram, Messenger, etc. – to see how performance can be salvaged.”

The implications of Apple’s ATT

“There will be a need for targeting to lean on first party data more so that the relevance isn’t sacrificed in an attempt to not come off as stalker-ish or creepy.”
“Consolidating spend within a smaller number of campaigns and audiences is likely to be beneficial in that it allows more budget to be focused on higher intent audience pools,” she says. “A more streamlined account structure will also remove audience overlap, preventing self-competition which can place additional pressure on CPMs. Finally, it’s important to maximise the number of users in competitive retargeting audiences by allocating budget to traffic-driving initiatives both on and off Facebook.”
It also seems that Apple’s decision is having a knock-on effect, with CPM costs rising on Facebook. Emily Smith, Paid Social Account Director for Croud, says that the opt-out functionality “has led to a reduction in targetable users on the platform, further exacerbating the rise in CPMs – already compounded by Covid and a subsequent surge in demand, which outstrips supply of available ad inventory.”
“There’s a lot businesses can learn about their products and their customers by studying CRM data, which can inform the way we advertise to broad audiences of new prospective customers. Personalised ads can make (privacy-friendly) non-personal ads better,” he suggests.
Kevin Joyner, Director of Data Solutions for Croud suggests that Apple’s privacy features won’t dramatically change ad spend, and that advertisers will continue to invest in reaching the same users (on the same platforms and apps).

Rising CPMs could see marketers shift away from Facebook

Indeed, Light-Wilkinson suggests that brands need to focus on becoming “the true owners of their audiences” rather than “paying a very high price to rent them.” He cites a recent Wunderkind survey which found that two thirds (66%) of UK ecommerce and marketing leaders say they are reliant on third-party cookies, with a similar proportion (65%) expressing nervousness or concern about digital platforms, such as Apple and Google, banning cookie use. “However, once brands embrace and invest in ways to optimise customer identification and engagement via their owned channels,” says Light-Wilkinson, “they will be able to grow and retain a more highly engaged, higher-converting and more valuable customer in the long-term.”
I spoke with a number of industry experts to get their views on Apple’s new privacy measures and what they mean, along with how advertising will evolve in a post-cookie world.
Jellyfish’s Alex Davies agrees that personalisation can occur, but in different ways than what we’ve seen previously.
Wulfric Light-Wilkinson, GM EMEA of Wunderkind, agrees that brands will have to work harder (and more intelligently) to attain first party data. And “once they have it,” he says, they need “to leverage it through owned channels to engage and retain shoppers.”
“While it won’t yield the results of yesteryear, advertisers will have to be content with the increases they’re seeing. There will of course be alternatives such as Snap or Pinterest if their returns on Facebook have taken such a hit that optimisations aren’t helping to mitigate the performance drops.”
So far, Facebook has come away unscathed, with ad revenue for the platform rising 56% to £20.5bn in the three months to 30th June. However, this is due to the slow rollout of ATT, meaning Facebook is yet to feel its real and long-lasting impact. In Facebook’s Q2 2021 earnings call, CFO David Wehner predicted that this will soon happen: “We continue to expect increased ad targeting headwinds in 2021 from regulatory and platform changes, notably the recent iOS updates, which we expect to have a greater impact in the third quarter compared to the second quarter.”
New privacy measures are starting to impact the digital advertising landscape, as costs increase and user targeting becomes less efficient following Apple’s ATT rollout. For digital agencies and advertisers, paid social isn’t as straightforward as it once was, and new questions are arising about whether Facebook’s domination of this world will be affected.

Brands to become “the true owners of their audiences”?

That’s not the whole story, of course, with Apple’s ATT also impacting the extent to which advertisers can personalise ads (based on contextual data generated in apps). As a result, Facebook is expected to be affected, as the platform is unable to track and target users like it used to or to measure the success of ads, meaning advertisers are expected to pull away from the platform.
Alex Davies, VP of Analytics at Jellyfish predicts a similar future. “Less data, more modelling; technology will migrate to both server-side solutions and clean rooms; advertisers will need to match user data against a platform’s device graph to provide more accurate reporting of conversions.”
Croud’s Emily Smith says that marketers will need to make strategic use of first-party data solutions. “We’re already beginning to see this, with Facebook requiring use of their server-to-server integration Conversions API for holdout testing and conversion lift studies,” she says.
Apple’s new privacy measures is not the only shift to occur, with Google’s Privacy Sandbox, which will phase out third parties cookies, scheduled to rollout in Q3 2022. This, too, will change the way advertisers are able to target users. So, how can advertisers maintain and measure digital performance in this new privacy-driven world?
All of this begs the question of course… can privacy and personalisation co-exist in advertising? Kevin Joyner of Croud suggests that the two can co-exist, but again, only if advertisers are clever about data and targeting strategies.
“Advertisers will invest in new ways to use different data to develop audience definitions; and they’ll invest in new techniques for studying ad effectiveness and optimising budgets (ones that don’t rely on personal data),” he says. “We don’t expect ad spend to change much, just shift between the advertisers who are able to adapt to these changes and implement these techniques.”
As a result, Smith suggests that smaller advertisers will be most affected but that a change in strategy will be needed across the board, which could see budgets shift.
App Tracking Transparency (ATT) updates by Apple have changed the way that marketers can target consumers across channels. Following the introduction of ATT in April as part of iOS 14, iPhone users are now automatically given the choice of opting out of IDFA tracking – i.e. ‘identifier for advertisers’ – which tracks in-app activity.

Can personalisation and privacy co-exist?

Finally, Shamsul Chowdhury agrees that as privacy continues to be a primary concern for users on social platforms, “it will be incumbent upon the social platforms to loosen their grip and not seem so intrusive with highly relevant ads,” he explains.
“Additionally, while manual segmentation to aid personalisation will become more fraught, the ad platforms’ continually improving ability to judge interest and relevance through interaction signals will naturally give the consumer an impression of personalisation through the ad creative they receive.”
Essentially, if users opt out, advertisers no longer have access to this type of data, which typically informs ad targeting and strategy. But what impact will this have on overall spend?
“Whilst server-to-server integrations can safeguard against cookie loss, using these in conjunction with marketing mix modelling (MMM), calibrated by regular incrementality testing, is likely to be the most effective way to measure true business impact in a post-cookie world.”
“Measurement-wise, this will signal a shift away from some of the more nebulous, top-level metrics (impressions, reach, open rates, etc.) and more down-funnel, towards direct revenue attribution and ROI from marketing activities.”
However, crucially, Joyner says that ATT will change how advertisers target those users.
“Ultimately”, says Davies, “the common denominator across all of these is that first-party data is becoming increasingly more important. From a skill-set perspective, this will create a greater need for data science and technical implementation skills, but it’ll also mean that marketers will adapt and trial new techniques to market to a wider audience rather than being reliant on hyper-targeting on a 1-2-1 basis through ad-tech.”

Posted by Contributor