The impact of Apple’s new data privacy update for brands

By Hayley Coleby, Head of Social at The PHA Group.

Data privacy is an issue that is almost as old as the internet itself, but only recently has it become such a thorny subject.

The issue was brought to the forefront of public debate in 2018, when Donald Trump’s 2016 presidential election campaign team was accused of using and secretly storing the data of 50 million Facebook users without their permission. Cambridge Analytica was at the centre of that storm which has raged ever since, resulting in Facebook’s CEO Mark Zuckerberg testifying to Congress and a $5 billion fine being handed down to the social media platform by the FTC.

Apple’s data privacy update

Last month, Apple further fuelled the growing debate around online data privacy when it announced the latest iteration of iOS 14, a software update which has delivered significant visual changes to our smartphones.

The new privacy update, which was rolled out in iOS 14.5, centres on ad tracking and grants users more control over their data. The move has sparked a public debate between Apple and social media platforms, with Facebook particularly concerned over how the update will impact ad targeting and tracking - claiming it will affect many small businesses that use its platform for marketing.

The impact of iOS 14.5 on social media platforms

The update means that users now have the choice to expressly give consent to track them and many anticipate that a significant number of users will opt out – up to as much as 80% of Facebook users, the platform’s own survey has suggested.

Facebook isn’t the only social media platform affected by the update. In recent years, all of them have been developing their e-commerce capabilities to enhance their offering for marketers, from Instagram launching ads in Reels to TikTok testing a new in-stream shopping tool. They all rely heavily on data to optimise targeting performance for marketers.

But, if a user opts out, social media platforms will not be able to track user behaviour, resulting in inaccurate targeting and less detailed reporting on conversions. For example, remarketing lists, lookalike audiences and conversion events on Facebook will all be impacted greatly, with many campaigns no longer delivering the results previously achieved and at a far higher cost.

Alternatives for brands

With the effectiveness of social media now under greater scrutiny than ever - at a time when advertising budgets are particularly tight following a deep pandemic-induced recession - marketers will be looking for alternative channels to use instead of or in support of traditional digital ones. In short, these are marketing channels which require little to no data sharing.

One such channel is contextual advertising, which involves placing display or video adverts on online outlets. Marketers can target consumers based on known characteristics which they can use to predict the types of content that audience is likely to consume online.

For example, a sportswear brand can place an ad on a football blog.

Influencer marketing works in a similar way. Marketers can also reasonably predict the type of consumer that is following a particular influencer based on their content and online profile and commission the influencer to produce sponsored content to reach a specific audience. With the consumer actively following the influencer and invested in their output, brands can use influencers to reach a highly engaged audience and use their owned data on social media to report on campaign effectiveness.

And finally, marketers can also seek to produce their own organic content with a unique, creative and authentic voice to engage existing consumers and engage new ones.

Building a brand personality online can be a longer-term strategy to generating consumer engagement and awareness and ultimately sales, but a highly effective one if carefully managed.

Take Wendy’s for example, the fast-food chain has built a massive online following – over 3.8 million – thanks to its clever and witty topical social media posts and consumer interactions.

Apple’s data privacy update is a shock to the system for the established elite social media platforms, but in truth it has been expected for some time that consumers would regain control of their private data as digital ethics increasingly comes into question by savvy consumers. And marketers must now adapt.

Diversifying marketing channels away from the traditional digital options and exploring newer ones, such as influencer marketing, can be the solution in a cookieless world.

Image by alvarez on iStock