Apple’s iOS 14.3 Privacy Policy and the Facebook Audience Network

Apple’s new privacy policy severely limits Facebook’s ability to personalize ads for iOS users on third-party apps in the Facebook Audience Network. Ads from Chip sellers on Facebook and Instagram are not affected by this change. However, advertisers who have campaigns that are opted-in to the Audience Network will need to make changes to reach iOS users.

You may have read about new Apple privacy features for iOS, and the impact these changes will have on Facebook advertising. iPhone users make up slightly more than half the buyers using mobile web browsers on Chip, so it’s important to keep track of Apple policy changes that impact advertisers.

About the Facebook Audience Network

Facebook’s core business is serving personalized ads on Facebook and Instagram, based on user demographics, behavior, and interests. But Facebook also makes money by displaying ads in other developers’ apps with its Audience Network, which lets app developers display Facebook-served ads within their apps. Facebook personalizes ads in the Audience Network using data it has collected through Facebook, Instagram, and other apps that use the Facebook DSK.

When advertisers create campaigns on Facebook, they are encouraged to also show their ads on the Facebook Audience Network, but they can opt out. Audience Network ads are typically less expensive than campaigns on Facebook or Instagram, but they have lower click-through and conversion rates because the ads are often served as banners or interstitials in apps where they may be perceived as distractions. Audience Network ads may be more effective for brand advertising than for conversion-focused campaigns.

Apple’s New Privacy Features

In December 2020, Apple released iOS 14.3. The new operating system includes a long list of new privacy-related features, but a feature called App Privacy has a significant impact on the Facebook Audience Network. Now, iPhone users are asked to opt-in to cross-site tracking, which Facebook has used to power the Audience Network. Data gathered on Facebook, Instagram, or apps in the Audience Network can no longer be used to personalize ads served by Facebook in other iOS apps. (This does not impact Android apps.)

Facebook’s Response

Because the opt-in rate is expected to be very low, the effectiveness of the Audience Network for iOS users will be limited. Facebook has publicly protested Apple’s changes on Twitter and in newspaper ads, but Apple is unlikely to change the policy without US or European government intervention. Even if that eventually happens, it won’t be soon.

In response, Facebook has removed cross-app tracking from its own iOS apps and from the Facebook SDK used by third-party developers. This means that iPhone users will not be asked to opt-in, because the apps will no longer track users across sites. Facebook will still attempt to target ads for iOS apps in the Audience Network with other, less personalized, targeting techniques, but it is unclear how effective the new ads will be.

Impact on Chip Sellers

If you have campaigns that are opted-in to the Audience Network, you may continue to use them to target Android users. However, to also reach iOS users, you must create new, standalone iOS-specific Audience Network campaigns. (See: How Apple’s iOS 14 Release May Affect Your Ads)

We encourage Chip sellers to experiment with different ad strategies and closely monitor the performance of campaigns using the Audience Network, especially those targeting iOS users. We’ll continue to monitor the situation and will post updates with any major changes.