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FB expects up to 50% loss from Audience Network revenue due to iOS 14. (13)

08-27-2020 12:16 PM #1 matuloo (Legendary Moderator)
FB expects up to 50% loss from Audience Network revenue due to iOS 14.

An interesting prediction has been posted by the FB team... they expect to see a massive drop in advertising revenue from apple product users, once they publish the iOS 14 update. What they claim is that as much as 50% !!! drop in revenue is likely to happen.


The problem is the requirement to stop using a unique customer identifier, which allows advertisers to better target their ads, based on FBs data.


Today, advertisers can use a unique device ID number called the IDFA to better target ads and estimate their effectiveness. In iOS 14, each app that wants to use these identifiers will ask users to opt in to tracking when the app is first launched. Facebook said its apps will not collect IDFA information on iOS 14.

This move will not only cut the revenue generated by app developers, but it will definitely make the targeting harder, which should result in a decrease in conversion rates for advertisers.

“We know this may severely impact publishers’ ability to monetize through Audience Network on iOS 14, and, despite our best efforts, may render Audience Network so ineffective on iOS 14 that it may not make sense to offer it on iOS14 in the future,” Facebook said in a blog post.

“While it’s difficult to quantify the impact to publishers and developers at this point with so many unknowns, in testing we’ve seen more than a 50% drop in Audience Network publisher revenue when personalization was removed from mobile ad install campaigns,” Facebook said. “In reality, the impact to Audience Network on iOS 14 may be much more, so we are working on short-and long-term strategies to support publishers through these changes.”

I doubt the impact will be that big, FB is likely doing some boo-boo here, but the impact will be there for sure.


Full CNBC article here: https://www.cnbc.com/2020/08/26/face...e-in-half.html
Blog post from FB here: https://www.facebook.com/business/ne...ios-14-launch/

Thoughts?

08-27-2020 02:10 PM #2 dirtyrice (Member)

What if Apple wants some of that Facebook business model in the future and this is step 1 to that goal? Many of these companies take ideas from one another. No different than ripping a good lander from a spy tool.

Just a theory.

08-27-2020 02:20 PM #3 Mr Baffoe (Veteran Member)

The impact overall for FB will probably be small because I doubt much revenue comes from the audience network, and out of that, iOS is a smaller portion of the overall revenue.

So this hit is more of something that affects publishers.

FB doesn't need IDFA tracking to know who's using their App directly, everyone is logged in.

So, this move by Apple is actually great news to FB.

It will shrink or wipe out competing ad networks that don't have identity data via logins and depend on IDFA for targeting, tracking and attribution.

They will see some losses from lack of tracking in certain situations, but the increased ad revenue that will move over from competitors will more than make up for that loss.

08-27-2020 09:43 PM #4 matuloo (Legendary Moderator)

Quote Originally Posted by Mr Baffoe View Post
The impact overall for FB will probably be small because I doubt much revenue comes from the audience network, and out of that, iOS is a smaller portion of the overall revenue.

So this hit is more of something that affects publishers.

FB doesn't need IDFA tracking to know who's using their App directly, everyone is logged in.

So, this move by Apple is actually great news to FB.

It will shrink or wipe out competing ad networks that don't have identity data via logins and depend on IDFA for targeting, tracking and attribution.

They will see some losses from lack of tracking in certain situations, but the increased ad revenue that will move over from competitors will more than make up for that loss.
Interesting... so in the end, FB might even come stronger out of this you believe?

I dont know much about their audience network, but if what you say is right, this move can do more damage to smaller ad networks and drive more publishers to FB for monetization... that's not the outcome I hoped for to be honest

08-27-2020 11:12 PM #5 Mr Baffoe (Veteran Member)

Quote Originally Posted by matuloo View Post
Interesting... so in the end, FB might even come stronger out of this you believe?

I dont know much about their audience network, but if what you say is right, this move can do more damage to smaller ad networks and drive more publishers to FB for monetization... that's not the outcome I hoped for to be honest
Yep the biggest winners from Apple's (and the other browser's) privacy push will be FB and Google.

They have all the first party data, and billions of logged in accounts for id verification.

Other Ad networks depend on a lot of 3rd party data matching via cookies, IDFA, fingerprinting etc which, can, will and have already been restricted or eliminated by Apple, and the major browser makers.

After iOS 14 launches, I'd say you have about a month at most, before you start to really see the effects on your business.

08-28-2020 12:59 AM #6 jaybot (Veteran Member)

However.

Most affiliate marketing is and should be modeled off of Direct Response. Which means, getting those fish on the first shot.

Retargeting is fun, and can earn you extra bucks, especially if doing ecom (and have your own offer and trying to do LTV).

But the vast majority of affiliates it shouldn’t affect.

08-28-2020 08:51 AM #7 matuloo (Legendary Moderator)

Quote Originally Posted by jaybot View Post
However.

Most affiliate marketing is and should be modeled off of Direct Response. Which means, getting those fish on the first shot.

Retargeting is fun, and can earn you extra bucks, especially if doing ecom (and have your own offer and trying to do LTV).

But the vast majority of affiliates it shouldn’t affect.
Yup, for the part of the business that most of us here on the forum is in, this is not a big issue. Everything I run personally is direct response.

But the way I understand it now, after what Mr Baffoe posted above, this move will just further strengthen the "monopoly" of google and FB and that's never a good thing.

On top of that, this can strongly impact the bottom line of content creators who rely on ads for monetization... adsense revenue is very low compared to some other smaller niched networks and these small ones will suffer the most, I'm afraid.

01-04-2021 02:01 PM #8 mcstacks (Member)

Quote Originally Posted by matuloo View Post
Yup, for the part of the business that most of us here on the forum is in, this is not a big issue. Everything I run personally is direct response.

Quote Originally Posted by jaybot View Post
However.


Most affiliate marketing is and should be modeled off of Direct Response. Which means, getting those fish on the first shot.


Retargeting is fun, and can earn you extra bucks, especially if doing ecom (and have your own offer and trying to do LTV).


But the vast majority of affiliates it shouldn’t affect.

Hey @jaybot and @matuloo - I know your last replies here were in August...but I'm wondering if/how your stances have changed on iOS 14 affecting affiliates that advertise on Facebook?


Just got a pretty sweet email from Stacked Marketer this morning outlining a tons of stuff around this...including some moves to make.


As I'm newbie as a full-time affiliate, I'm focusing on whitehat leadgen and all my ads are on FB, it's the only platform I'm using. But I'm wondering how I should adjust as we all area, or even if I should stay for now on FB or switch to Native, etc.


Curious your take too @Mr Baffoe on all of this?

01-27-2021 05:47 AM #9 redtrack (Member)

The decrease with FB ads is going to hurt the most at the moment with the IOS 14 privacy update. But what we have to understand is that it's just the beginning.Once Google launches its Sandbox, then it's gonna touch literally everyone on the market.
If you wanna know more about the upcoming changes, you guys are welcome to join the LiveStream on 28th of January https://www.youtube.com/watch?v=8chyuZX-f3w where our CEO Vlad will reveal the topic of all the tracking blocks that await us in 2021 and how to prepare yourself. Don't forget to set a notification, not to miss it!

01-27-2021 08:48 AM #10 zeno (Administrator)

Quote Originally Posted by Mr Baffoe View Post
Yep the biggest winners from Apple's (and the other browser's) privacy push will be FB and Google.

They have all the first party data, and billions of logged in accounts for id verification.

Other Ad networks depend on a lot of 3rd party data matching via cookies, IDFA, fingerprinting etc which, can, will and have already been restricted or eliminated by Apple, and the major browser makers.

After iOS 14 launches, I'd say you have about a month at most, before you start to really see the effects on your business.
I'm not sure their first-party data is a panacea?

From what I understand, if users choose to disable tracking in iOS Facebook needs to abide by that and not allow unique tracking of that user... including things like generating a FBCLID and accepting that via S2S for a conversion event. Apparently they have to drop it if they know the event is from an iOS do-not-track user.

I'm not 100% sure on all of this, just basing this on what has been said by some Facebook engineers via Clubhouse. To parahphrase, regarding S2S tracking, "nah — FB is just gonna reject ALL tracking/user matching if they’re optOut” -- this is quite a scary thought for most advertisers as it could mean that, if the user is on iOS and choose opt out, FB to be compliant has to completely drop tracking of them, or else get kicked off the app store/Apple SDKs, which they certainly can't afford.

01-27-2021 10:44 AM #11 stickupkid (Senior Moderator)

As a total tech noob, is it better to exclude iphone users now or doesnt make sense?

01-27-2021 12:50 PM #12 wisdompower (Veteran Member)

Quote Originally Posted by stickupkid View Post
As a total tech noob, is it better to exclude iphone users now or doesnt make sense?
Great question. Waiting for others to chime in. But was thinking, "someone who uses an iphone surely has more money to spend than others... "

01-27-2021 05:45 PM #13 matuloo (Legendary Moderator)

Quote Originally Posted by stickupkid View Post
As a total tech noob, is it better to exclude iphone users now or doesnt make sense?
I guess it depends on what your strategy is... in case you're going for direct sales, all it takes is keeping eye on the stats to see whether the performance went to shit or not and pause as needed.

For those with long term strategies, such as retargeting and cross channel promotions... the whole setup will likely suffer much more.

Personally, I would just keep running as usual and watch the performance of iOS users much more closely.

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