Written by: Natalia Nicholson, Executive Contributor
Executive Contributors at Brainz Magazine are handpicked and invited to contribute because of their knowledge and valuable insight within their area of expertise.
Apple’s plans for introducing changes to their iOS 14.5 system have left Facebook feeling worried, but why is this the case?
Apple’s latest intention is to require permission to be sought from developers to ask their users’ permission before collecting any data or tracking their behavior during their app usage. This comes hot on the heels of Apple’s recent introduction of “nutrition” style privacy labels requiring developers to disclose the information they’ve collected about their app’s users in their App Store. While those changes have been applied universally to all app developers, the Facebook team has taken it all rather personally and hasn’t been afraid to make their feelings known.
In December, you may have seen full-page adverts taken out by Facebook that claimed Apple was threatening not only small businesses but also an open internet in the way we understand it today. Not only that, but Mark Zuckerberg, CEO of Facebook, then targeted Apple when making his statements at February’s earnings call, claiming Apple’s actions were, essentially, anti-competitive practices.
All of this can all-too-easily be mistaken as a fight about tracking or privacy. However, there’s another reality at play behind all this. So, what is all the fuss really about?
The Benefits of Facebook Advertising
To really understand the impact of Apple’s changes on Facebook’s business model, you need first to understand the current benefits of Facebook advertising.
Many businesses choose to use Facebook’s advertising platform not only because it offers a huge user base across several demographics and across all stages of their target audience’s engagement journey thanks to the wide variety of ad formats but also because of the fact that Facebook allows for the highly measurable performance of those adverts. Advertisers receive metrics about everything from post engagement and page likes to clicks and conversions right through to sales. This is all possible because Facebook is tracking everything that its users do online, and they’re hoping that those users don’t ask too many questions about it.
Apple’s New Changes
The changes proposed by Apple won’t prevent developers from being able to track their app’s users. Nor is Apple against personalized ads. Apple won’t prevent any individual from sharing their online activities with Facebook, and developers will still be able to collect the Identifier For Advertisers (or IDFA) to track conversions and target ads. All Apple will require is more transparency from developers about the data they’d like to collect and how they’d like to use that data. Oh yes… and then they’ll be required to ask the user’s permission. This is the heart of the true battle – transparency. This is why Facebook’s team is so worried.
Opting Out of Tracking
Facebook is facing the problem that, when given choices, a lot of people will probably prefer not to permit tracking. In fact, a recent survey has shown that 47% of all users have expressed a preference for opting out of all tracking. Now that’s something that bothers Facebook a lot. Facebook would rather their users don’t think at all about tracking.
Furthermore, they don’t want their users to have any choices about whether or not their online behavior is tracked.
The transparency problem that Facebook is facing isn’t only with users. Tracking doesn’t just allow Facebook to show targeted adverts based on the user’s activities. Still, it also enables advertisers to see which customers have visited their site and which have purchased something due to an ad. This is something that is absolutely essential since it enables tracking of conversions by advertisers who can then justify the amount they’ve spent on advertising.
When Facebook isn’t able to track its users, the advertisers can use the Identifier For Advertisers to match the purchase an individual has made with the advert that they clicked on. Essentially, this reduces the value of Facebook’s advertising platform and is likely to result in a shift of advertisers from Facebook to other platforms like Google Ads, thus reducing Facebook’s revenue exponentially.
So, it all comes down to this. Facebook isn’t afraid its business model will collapse due to tracking or privacy. What it’s really worried about is transparency. When lack of transparency is at stake, Facebook’s advertising platform revenue is likely to be put into significant danger, and that signals major issues for the company. With this in mind, it’s pretty easy to see why Facebook is getting so anxious and defensive about Apple’s proposals – wouldn’t you be worried if your business stood to lose money?
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Natalia Nicholson, Executive Contributor Brainz Magazine
Natalia Nicholson is a Serial Entrepreneur, Business and Digital Marketing Coach, and Professional Public Speaker. Natalia has over 20 years of experience working as a digital serial entrepreneur and has had plenty of her own failures and success stories. This has perfectly placed her to offer insight and advice to other women aspiring to become digital entrepreneurs, together with those who have already launched their own businesses. Through her mastermind group, Women in Digital Business, Natalia teaches them the best way to leverage digital marketing potential and helps them learn the best ways of overcoming the challenges that they are facing when it comes to becoming successful online businesswomen. Her passion for online business coaching and digital marketing has inspired her to inspire women from largely overlooked underrepresented groups.
