Apple stopped every advertiser and media buyer in their tracks upon their recent announcement of its tracking opt-out feature for its upcoming iOS14.5 update. And in this announcement’s wake lies a massive void of knowledge for a vast sea of advertisers in terms of what Apple’s got up their sleeve and how this will impact eCommerce store owners and Facebook advertisers who rely on Instagram or Facebook ads for all or part of their annual revenue.
We’re here to fix that, at least in part.
If you have a limited understanding of the impact and are in the dark in terms of what to do next, you’re in the right place. We’ve done our best to distill this down for the C-suite who may not be intimately familiar with the minutiae of Facebook advertising, while giving media buyers who are veterans in the space what they need as well to fully prepare, with a melange of skimmable information from 30,000 feet paired with a deeper technical understanding for their team members to ensure your brand doesn’t get left in the dust.
Should you share or publish any aspect of this article, we ask that you cite us as a source with a link to this page.
Many thanks to our connections at Facebook and Apple, our agency R&D team (who tirelessly poured through press releases, trusted blog articles, guides, and interviews and researched and verified all of this information before approving its release), the group of world-class experts at our back who serve as mentors, and especially to the brilliant minds at Ogilvy for making navigating through these waters easier for us. You know who you are.
The Gist (The Executive Summary)
For those of you in the C-suite who sense something is brewing and have heard a thing or two but haven’t the faintest idea as to what’s actually going on, how it impacts you, or what your teams should actually be doing about it, this is the section that most requires your attention.
WHAT'S EVERYONE GOING ON ABOUT, NOW?
In June 2020, Apple announced an upcoming change to their iOS14 iPhone and iPad operating system. Apple would prompt users on whether they were willing to allow the app developer to track their personal usage of the app through their ‘AppTrackingTransparency’ (ATT) framework.
OK, BUT WHY?
Apple swears this is a wholly noble attempt to want to protect users’ privacy. However, given the setup of a new iPad requires no less than 10 steps, most of which is gathering data such as credit cards, fingerprints, physical addresses, and what color underwear you’re wearing today, the cynical among us are more inclined to believe that Apple is more likely laying the foundation to monetize what they see as a new opportunity. That seems to be Facebook’s official position, as well. Not completely implausible given we live in an era where data is more valuable than gold or oil.
The truth, however, is likely somewhere in between.
HOW LONG DO WE HAVE UNTIL CHANGES TAKE PLACE?
iOS 14 is already here, but ATT won’t be implemented or rolled out publicly until iOS14.5 is. As a result, brands likely won’t feel the impact until Q2 of 2021, once a larger number of Apple users upgrade their operating system on their existing devices and new devices holding the new operating system are sold once iOS14.5 is released this spring (2021).
HOW WILL THIS IMPACT MY BRAND?
The breadth and depth of the impact is not entirely known, because we don’t know how many will opt-in to Apple’s new anti-tracking feature until they actually opt-in. Here’s what the industry does know: this isn’t expected to have a significant impact until:
- The number of users on iOS14.5 hits critical mass, and
- There is some actual quantifiable data on how many people opt-in to Apple’s feature, thereby opting out from being tracked.
Apps that rely on collecting user data to deliver a more customized, personalized experience and/or advertising will be impacted and any core monetization opportunities that free apps in particular rely on could be at risk.
If Facebook’s apps are unable to track users on iOS14 due to the number of opt outs reaching critical mass, retargeting, effective campaign performance tracking, and effective acquisition audience targeting may be negatively impacted, as well. We’ll know more over the next 6 to 8 months as more users adopt iOS14 and apps receive quantifiable data as to how much user-level data has been collected and lost. Facebook has communicated plans to share what percentage of users have opted out of tracking on iOS14, so stand by.
Is This Just a Facebook Problem or Should We Be Concerned About Other Platforms, as Well?
While Facebook is currently making the most noise on this, this update from Apple impacts all apps online. That means TikTok, Pinterest, Snapchat, Amazon and any other app that relies on collecting user data in order to effectively offer advertising services or provide a personalized experience. Mobile app advertisers will be impacted more than their non-mobile counterparts.
Because Google will not use an IDFA (Identifier For Advertisers, which is a unique identifier for mobile devices and is used to target and measure the effectiveness of advertising on a user level across mobile devices), they do not need to comply with Apple’s tracking notification on their platforms, such as YouTube.
WHAT ASPECTS OF OUR MARKETING OR MARTECH WILL THIS IMPACT?
Luckily, what is or isn’t trackable on websites via pixels (whether running server-side tracking or using cookies) are safe; that will not be impacted. However, for mobile browsers running inside applications, such as Facebook’s in-app browser that is defaulted to open when users click on an ad and clicks through to a brand’s website or eCommerce store, there will be an impact.
Facebook has created a workaround of sorts in response to Apple’s actions by creating what they call Aggregated Event Management, which they believe will, at least in part, prepare brands for the upcoming changes. In a nutshell, if an Apple user does opt out of tracking, this allows brands like yours to collect some data regardless, but it will be aggregated and will not be linked to an individual user’s action.
These changes also have the potential to impact organic performance on Facebook, which heavily relies on behavioral digital cues from its users in order to serve up recommendations and posts that the platform believes is relevant to them. Those signals typically take place both in the app and in apps or websites you click through to while browsing Facebook, Instagram and using Messenger and are used to see who you interact with, what types of content you’re most interested in, the sorts of groups and Pages that you visit and engage with, and ultimately, what you resonate with the most. All to put together a hidden digital dossier of who you are and what makes you tick. This update, if adopted by a critical mass of iOS14 users, will result in fewer signals being collected from that segment of any audience that’s targetable using Facebook ads.
When it comes to the technicals of media buying that your Facebook ads team will want to know:
- Your Facebook ad set optimizations will be negatively impacted, given Facebook has determined that the 7-day click, 1-day view optimization at the ad set level will be the new default. That means less data for the platform to look back on.
- Custom audience sizes will drop due to the missing iOS14 users who have opted out of tracking that were previously included in your audiences.
- Facebook has confirmed that if a user opts out of tracking on iOS14 then Facebook will aggregate all data collected from them following any in-app activity all the way through to your website. So while your website will still receive data, because of the eight- conversions limit if a user opts out of tracking on iOS14, you will only be able to report ONE conversion that they’ve completed.
Lastly, there may be some page builders that may no longer be ideal to run traffic to if part of your media buying strategy is in capturing Facebook pixel events from those sites (which certainly should be part of your strategy). You’ll need to have your marketers and developers pay closer attention to the technicals when it comes to landing page builders and evaluate whether domain verification, which is required in order to be able to track and optimize for Facebook pixel events, is possible on each one. Many platforms, such as Samcart, are working doubletime to build a solution so that their userbase doesn’t encounter disruptions upon rollout of iOS14.5.
IS THE INDUSTRY CRYING WOLF? WHAT'S THE LIKELIHOOD THAT THIS CHANGE WILL MATERIALLY IMPACT OUR BRAND'S MARKETING AND ADVERTISING?
Honestly? It’s somewhat unclear; there isn’t enough insightful adoption data to that end that’s publicly available at this time. However, it’s absolutely worth noting that 1) this update will only be rolled out to users who have Apple devices that upgrade to iOS14.5 and anyone who purchases a new Apple device come Q2 of 2021, after the wider rollout. This means that this will not be readily available to those with devices on older Apple operating systems. This is important given iOS 13 was launched September 19th, 2019, yet didn’t hit 81% adoption for all compatible Apple devices until June of 2020.
2) This opting-out being made available to iOS14 users does not in any way prevent them from seeing ads in their newsfeeds or anywhere else online, and it in no way prevents them from experiencing anything else on any social media platform.
They’ll simply see ads and posts far less relevant to them, their desires, and their needs. Ultimately, it really only results in a poorer digital experience for the user. As such, there’s a possibility that the majority of users may choose not to opt out of tracking - but only if they understand this important point. Apple has no incentive to clarify for their users in this regard, although Facebook has announced there will be measures taken in their app itself to make this clear to its audiences.
According to MediaPost, a majority of Apple users concur with Apple’s recent privacy update. However, 74% would rather be tracked than pay for the use of sites and apps. A recent survey conducted by Sell Cell revealed that 59% might consider opting in to in-app tracking if it meant more relevant content. However, 65% would rather not be tracked and would be content with receiving generic ads not based on their interests.
Rest assured, Facebook is intently pouring through surveys like these - and conducting many of their own as they make decisions as to how this will change their own policies and updates as they attempt to adapt. In fact, just last week Facebook announced that they are testing a double pop-up on iOS14 devices so they can use both the iOS built-in dialog box and their own app layer to compel the user NOT to opt out. Given they have a solid case as to why users shouldn’t, this could very well mitigate some, though not all, of the impact.
The level of impact also ultimately depends on whether Facebook sees their error when it comes to domain verification and allows for a subdomain verification to take place that doesn’t require users to jump ship on certain platforms due to an inability to verify. For the vast majority of eCommerce brands, whose stores are custom-built, or sit on Shopify or another platform that has a primary domain, this will not be an issue. However, for eCommerce brands selling digital products or driving traffic to third-party page builders like Clickfunnels, Kajabi, Thinkific, Calendly, or Samcart, this is currently a bit trickier.
ARE THERE ANY OTHER WORKAROUNDS FOR US? WE HEAR CAPI MAY BE AN OPTION.
While the Conversion API (cAPI) isn’t a one-to-one, open-and-shut solution to the above risks Apple’s update raises and will not be a workaround for the iOS14 update, Facebook recommends this be a priority for your brand in preparation for additional upcoming browser and cookie-based changes expected to come down the pike in the future. Sources at Facebook confirm that they are rolling out more plug and play to make it easier to implement via partners like Google (on Google Tag Manager) and they will have their own native plugin soon, in order to make server-side integration easier.
For those not in the know, cAPI is designed to help advertisers collect data through their website without relying on cookies. As such, it doesn’t have a whole lot to do with tracking in-app activity, such as purchases, which is ultimately the industry’s main concern at present.
THEN WHAT SHOULD WE BE DOING ABOUT THIS, RIGHT NOW?
Per Facebook’s recommendations and those of our own network, there are actionable steps we at KRA will be implementing soon to ensure our agency clients -- consulting and holistic media buying clients alike -- are fully prepared to take advantage of the new upcoming opportunities that these changes will bring.
The following are noteworthy points your brand should consider implementing as soon as is possible, segmented by role within the organization for ease of implementation for mid-size to large brands.
For eCommerce brand founders with 5-15 employees, we recommend pouring over the sections for executives and the section for CMOs, marketers & media buyers and passing along the developer section to the brand’s development team.
For solopreneurs or eCommerce founders with brands who have less than 5 employees, we recommend reading all sections in their entirety.
FOR BRAND FOUNDERS:
- Be prepared to receive less accurate reporting and performance data from Facebook. To what extent this will take place will, again, largely depend on Apple user adoption of the opt-out and the measures Facebook is currently developing to mitigate interruption to their advertising service in the coming months.
- Well thought-out marketing campaigns that create emotional resonance with audiences (the ins and outs of which we’ll dive into on the next blog post) and multi-channel strategies are the keys to the future for brands today. Yes, this means that the wheat will be separated from the chaff when it comes to marketing and advertising agencies and media buyers and advertising “experts” will need to have the chops to be able to earn their keep in the coming months and years ahead.
- Brace yourselves for a digital world without cookies. We’ve all heard the term used in the context of the digital sphere, but not everyone knows what they actually are, so let’s get into that, first. A cookie is created by browsers to identify digital aspects of who you are and provide that information to websites that request them. For example, Facebook’s tracking pixel can create a cookie. Your website can create one as well, if, for example, someone creates a login and their browser “remembers” them so they can avoid having to manually type in their username and password again. The former example would be of a 3rd party cookie, the latter example would be of a first party cookie.
Third party cookies are established by other websites, via tracking pixels for instance.
Cookies aren’t inherently bad or malevolent, but like just about anything on the planet, it can be used for benevolent or malevolent deeds, bestowing convenience and ease or wreaking havoc. The reason why there’s controversy on the topic at all is that the use of them is largely unregulated and uncontrolled, and extremely prevalent. GDPR took steps to give control back to the user, but some organizations believe further steps should be taken.
Google is one of them, having released announcements at the start of 2020 that they’d be killing off third party cookies by 2022 in Chrome, this impending change will have sizable implications for any and all advertisers that rely on tracking data for analytics, retargeting, cross-channel attribution, and the like. Here are some actions you should consider having your developer take to prepare, to that end:
- Set up first-party tracking for Facebook. This means your cookie will now be stored under your website’s domain - making it a first-party cookie - instead of Facebook’s (which is third party). We set this up by default for most of our clients but look into it a little more here by checking out the links under the “Learn More” section to ascertain what makes the most sense for your brand before you implement.
- Install Facebook’s Conversion API (cAPI). This has much of the same functionality as the Facebook pixel when it comes to tracking and reporting, but instead of relying on a browser, it sits on a server. We often set this up in addition to the more commonly-known browser-based pixel rather than in lieu of it; Facebook automatically dedupes for us. If you go this route, be sure to double and triple check that it’s working as it should, however.
- Install Server Side Tag Management. If you use a tag management solution to manage pixels and scripts for your website, like GTM, we’d definitely recommend this, even though it’s not terribly easy to implement. There’s a great resource here to that end.
- Get proactive in your brand’s growth, not reactive. What do we mean by this?
Nearly every traffic source can be bucketed into one of three main pillars:
- Paid - platforms like Facebook and Google (paid search) that own users and/or digital real-estate where your ideal prospects spend their time and can therefore be accessed or served advertising to - for a price.
- Earned - platforms that are owned by other parties but where you can get a piece of the limelight with a mention or feature (third-party blogs, social media communities, print and digital publications, podcasts, online forums, organic search, free virtual events and summits).
- Owned - where you create the space and as a result, own your own data. This is the best of the three because with these sources, you’re no longer at the mercy of the whims of platforms or other companies’ policy changes, glitches, or even company shut downs. There’s no one to shut off your access or yank you from your traffic source. Sources include email lists, telephone lists (SMS), and your brand’s own blog. These data sources can exponentially increase an eCommerce company’s valuation, providing a hefty boost to any exit strategy. Data truly is the new oil.
With that being said, the best way you can be proactive in preparation for any policy change or feature change on these digital platforms you don’t own is by continuing to build your own email audiences (yes, plural - segmentation is critical, which we’ll cover sometime soon on our blog) and phone lists. Having experimented and tested with over $100 million in ad spend, our data indicates that physical product eCommerce brands who get traction in terms of sales by starting off with an owned traffic source are 41% more successful at hitting their annual sales targets from paid advertising in the first year of running ads than those who start off with paid traffic without an owned traffic source. Aside from the obvious reasons in terms of leveraging this data for better optimized campaigns elsewhere, decreasing your reliance on the tech behemoths by building a strong foundation upon which to build a lasting marketing program will only be beneficial to the longevity and stability of your brand and its revenue, year after year.
Increasing your cLTV / CLV, or Customer Lifetime Value, is another critical move during this upcoming new age of advertising, wherein some brands face declining quality of audience targeting and as a result, potentially higher CPAs.
Did you know that some of the savviest eCommerce brands don’t even sweat breaking even or even taking a loss to acquire a first-time customer? That’s because they have a very strong backend marketing and advertising system that takes those new first-timers and builds a pipeline of future sales from them, extending their LTV five, ten, fifteen fold or more, depending on the nature of the product and how extensive the backend system is. So a $50 purchase of an item that cost you $10 to create and $30 to acquire a buyer for will prove to be a lucrative investment when there are mechanisms put in place to bring that same new customer to buy that same product or another product 6 or 7 times in the course of a year, bringing the revenue from that one $30 customer from $50 up to $350, in this example.
You can increase your cLTV or CLV in a myriad of ways, from loyalty and referral programs, to implementing a subscription-based model to supplement your sales efforts and introduce recurring revenue to your scaling arsenal, to simply strengthening your post-purchase email marketing strategy, employing win-back email campaigns to inactive customers, including unexpected rewards (samples) in your shipping packaging, and taking deliberate, conscious measures to employ a retention marketing / advertising strategy that effectively minimizes customer churn. After all, research from Bain & Company suggests, “increasing customer retention rates by 5% increases profits by 25% to 95%.”
The key to most efficiently increasing your CLV is in:
- Identifying your most valuable customers (those buying high-margin products, who consistently pay full price for products, rarely if ever cancel orders or ask for refunds, regularly and consistently buy from you, and have 35% higher AOV than average) will help keep great margins and even keep customer service issues to a minimum,
- Discovering where they came from and how you can get more of them coming into your universe by discovering how they learned about your brand, what their pain points have been, any common themes in terms of their buying behaviors (what they purchased can give you hints as to what you should emphasize in your selling, for example), and what excited them about what you have to offer,
- Building real relationships with all your customers by making sure you continue to resonate with their needs, wants, fears, unrealized dreams, and desires. Make customer success when it comes to the use of your product a top priority so they get the very best experience and the most bang for their buck (which leads to great reviews). Pay close attention to your customers post-purchase (before Facebook and its randomized, deliverability-impacting polls do) and act on the feedback they provide, and make consistent investments in R&D to improve existing products and intelligently inform your decisionmaking when producing new ones.
We’ve seen that when it comes to garnering stellar returns on paid social, our KRA Platinum clients, who achieve all of these under our guidance, are also among our highest-performing eCommerce clients and see ROAS of an average of 12.03x.
Increasing your AOV has the same effect as increasing your cLTV given the customer is being encouraged to purchase more, except they’re making those additional purchases the first time around, in one fell swoop. Enhancing your offer development strategy with bundling, cross selling, upselling, cash-back rewards, and free shipping thresholds to give your audiences incentive to buy more, the first time they buy, helps brands get the very most out of their acquisition dollar right away.
Improving your product margins is going to be beneficial for any eCommerce brand, all around, especially when paired with any AOV enhancement strategies you choose to employ. You really only have two options when it comes to improving your average gross margin, for instance: either raise your prices or lower your costs. The latter requires more work, but mitigates any risk of losing customers who you might otherwise end up pricing out of your new offering. Generally speaking, however, we find that most customers readily accept incremental price increases from stores they frequent, and in some markets, many don’t even notice.
If you’re considering offering free shipping or no-hassle returns, you can always use strategic increases in price to offset the cost of shipping product and the inevitable cost of accepting and reshelving returned goods.
Negotiating more favorable rates with your vendors up and down your supply chain is a more realistic possibility than you may think, especially if you’re coming to the table with the following:
- Knowing your supplier’s costs,
- Purchasing product off-season if your manufacturing facility is in high-demand only during certain times of the year and in low demand the remainder,
- Agree to longer-term contracts so you can set the cost now and mitigate against future rate raises, allowing for increased predictability,
- If your brand has stellar cashflow and you’re currently flush, offer your vendors payment terms that include more cash upfront in exchange for a discount.
- Keep your options open by regularly sending out RFPs to other suppliers who may offer more favorable rates. You may not even have to leave your current vendors as any lower cost alternatives may put pressure on them to match so as not to lose your business.
- Offer referrals to other companies that could be great potential clients for your vendors or an opportunity for them to enter a new market in exchange for a discount on the contract or monthly commission that could offset your costs.
But even better yet, consider vertical integration if you wish to decrease the cost of your goods for the long-haul. While it usually requires more work and cost on the front-end, owning the entire supply chain puts more power in your hands and cuts out costs you’d otherwise incur putting profit in the hands of your manufacturing partners and vendors. This option has the added benefit of making your brand extremely attractive to investors and attracting more lucrative exit opportunities should the moment ever come where you wish to entertain them. Vertical integration is one of the several facets we bring into view when it comes to helping them prepare for capital raises, mergers, and exits.
All this may seem like a lot of work to prepare for a mere iOS14 update, but in reality these are things your brand should be focused on, anyway - it’s only more critical now than ever before to pay close attention to areas of your business to be optimized in order to maximize your profits and best position yourself for fast, smooth journey to the next rung of your sales goals amidst a sea of uncertainty and disruption to the status quo.
4. Be sure your brand is taking a holistic approach to paid social. Whether you’re just gaining traction on paid social like Facebook or Instagram, or you’ve already seen a steady flow of sales and are in the process of scaling using paid social platforms, the single most important key to unlocking high-yield advertising lies in leveraging data from, evaluating, and optimizing a cadre of your brand’s functions through the lens of paid social. From research to offer and product development to CRO to social media and community management to inventory and fulfillment to public relations and partnerships, there’s an extensive list of brandside functions that indirectly or directly impact the efficacy of paid social on any platform, but particularly on Facebook and Instagram. Some of which we’ve already mentioned above.
The core of our marketing approach stands the test of time and gives us the range to hone in on all this in addition to media buying because the foundation of our methodology lies in decades-old philosophies by the likes of McKinsey, Ogilvy, Caples, Maslow, Schwartz, and Hopkins. Because we understand that media buying - and marketing as a whole - are ultimately reliant on a thorough and comprehensive understanding of human behavior, how people’s minds work, and both the rational and emotional aspects of why people buy and why they do so over and over again, we also know that technology doesn’t change marketing principles very much, if at all.
These philosophies have also shaped our holistic methodology and framework, whereby we place emphasis on optimizing not only the campaign side of the equation, but the brand / business side of the equation to ensure stability and a well-oiled machine no matter the market conditions.
It’s for these reasons that our brands get consistent, profitable growth no matter what platform changes, platform feature changes, or new policies come their way.
If the iOS14 updates teach us nothing else, it’s that brands must have an ironclad foundation if they’re going to win regardless of market changes. There isn’t a more critical time than now to stop going the traditional route and begin taking a more holistic approach when it comes to marketing and advertising for your brand, for this is the future of paid advertising. There are over 40 aspects to that end to consider and action on, but here are just a few that you’ll need to think through in order to start shifting gears and elevating your approach to profitable scaling:
- Does your media buyer regularly sync up with your PR, social media management, community management, email, and paid search teams? What data or information is regularly gathered and shared? How do these insights shape your paid social strategy? How do these insights shape your strategies for these other marketing verticals?
- If you manage multiple media buyers who specialize on unique platforms (ie: YouTube vs. Facebook), do they regularly talk to one another? If so, what are they leveraging from one another? Are there duplicative roles being carried out on multiple platforms when it comes to the audiences reached and the phase of the consideration process they’re in? Where are there inefficiencies, inconsistencies, or gaps?
- Are those who are managing your paid advertising having critical conversations with your operations and fulfillment team? Is your CMO in touch with your COO on a regular basis? If your business does phone sales, is your marketing team syncing up with your sales team to glean and gather data and insights? Are they syncing up with customer service for the same reason? What data is being leveraged from these conversations for paid social and how are these conversations shaping operational optimization?
- In what other verticals are there functions that require optimization that could directly or indirectly drive performance on paid advertising?
The rollout has already begun on Facebook and there are some changes your marketing and development team must make note of and take steps to prepare for, as well.
- Complete your Domain Verification. There are three ways to do this and although our preferred method takes longer to verify (72 hours) the change is more permanent and it’s much harder for a developer or someone else to overwrite it by mistake during the course of their own day-to-day or project work. That method is DNS verification. You can find the other two methods here.
After the domain is verified, you’ll need to connect your Facebook page(s) to the domain. It is critical that you know that on the domain access tab, you should not select ‘deny specific advertisers from editing ad links’ nor allow specific advertisers to edit ad links. The only selection we advise using at this time is ‘anyone can edit ad links’. The others sound like they’d be there for your protection, but what happens in reality is that Facebook disapproves all of your ads, which could create a nightmare scenario for your ad account.
2. Update your SDK. If you serve ads on Audience Network placement, you’ll need to take steps to update your SDK and code in order to remain compliant as soon as is possible. Facebook’s got a great resource to guide you along the process, here and here.
3. Subdomain pages (like Clickfunnels, Ontraport, Samcart, Thinkific, Kajabi and other third-party page platforms) require additional setup, which (as of the writing of this piece) ultimately require a custom domain of your own that sits on top of the existing subdomain. Some page builders are in the process of developing a work-around to allow for this, others may never do so.
It is CRITICAL to note that platforms like Samcart, Thinkific, and Calendly don’t currently allow for the installation of pixel on the other side of the app, which is problematic due to Facebook’s new domain verification policies. It means that while you can still send traffic to these platforms, unless you can verify your domain, you won’t be able to fire any pixel events back. This appears to be an oversight on Facebook’s part where they’re throwing the baby out with the bathwater, here; in the interests of being extra careful that they’re covering themselves legally, they’re setting up policies that hinder tracking on websites, which are outside the bounds of Apple’s ATT scope, going above and beyond what’s actually required by Apple.
Kajabi has recently provided a workaround to connect your custom domain with Cloudflare, thereby making it verifiable for Facebook.
Clickfunnels has long had an option to layer a custom domain onto its platform, which you can use to make your landing pages there trackable once verified. Instructions can be found here.
FOR CMOS, MARKETERS & MEDIA BUYERS:
- Please note that if you’re an eCommerce brand running a 24-hour to 72-hour flash sale for example, or any last-minute sales or ideas that require 11th hour implementation for that matter, you’ll have a harder time optimizing and tracking for them once these updates roll out unless the platform you’re building sale pages on does not issue out a subdomain or it does but allows you to layer a custom domain over it. For Shopify stores, we recommend considering Zipify as unlike most page builders, it fits that bill when it comes to not issuing out a subdomain for its use. Please see #3 in the For Developers section above for more context.
- It's also worth noting that, should you need to add, delete, or re-prioritize your 8-conversion event list (see #7 below) there is a 72-hour reset policy during which Facebook will pause all campaigns using these conversion events and it will be 72 hours before new campaigns using this changed event can launch – another critical new development to bear in mind for any last-minute or flash sale planning. According to Facebook, the 72-hour reset period ensures that there are no potential errors in reporting or optimization. Once an event is changed, the reset period extends for the maximum elapsed time that a previously assigned event could be reported. Please also note that the pausing that takes place is automatic, but the unpausing is not. Advertisers will need to manually unpause their adsets once the 72-hour reset period is over.
- You’ll notice a new Attribution Setting column created that refers to your reporting attribution. For all new campaigns and any campaign completed after January 19th, 7-day click and 1 day view is set as the default.
What does this mean? It means that if you’re evaluating two identical campaigns, one created before January 19th and one created after, you’ll likely see a reporting discrepancy going forward. In 12 days, one campaign shows 12-day attribution after the click (or rather, is counting a purchase made where the buyer clicked on an ad 12 days ago) because that campaign has the 28-day tracking, whereas the other will only show purchases made within 7 days maximum of the click from the ad. This ultimately means inaccurate reporting for one campaign vs the other, and underreporting for ad accounts whose products have a longer consideration process / sales cycle once Facebook eliminates the 28-day click attribution setting, a change which is coming down the pike soon.
- It’ll be more critical now than ever before to use eROAS (total revenue ÷ total ad spend across all channels) and eCPA to fill in some blanks and create some assumptions, AND utilizing Offline Conversions and reputable attribution tools to accurately track multi-channel behaviors.
- Reporting in ads manager will no longer be reliable on its own. Use Supermetrics to look back at historical data and evaluate various attributions settings to see how that impacts ROAS. Supermetrics will still have attribution reporting available for as long as they can, but once Facebook’s API pulls that, they’ll no longer have that available. So be sure to run that as soon as you possibly can!
- Use external tracking tools that don’t rely on cookies but use UTM parameters. Using a combination of Google and Wicked reports is the name of the game. Wicked is similar to GA in that it uses url tagging, but it also takes data from Facebook, Google, Stripe, Paypal and stitches it all together to give you more insights than Facebook can. Another effective tool is Hyros.
- Facebook is now limiting optimization and reporting to 8 conversion events per domain (subdomains and domains count as one domain), and includes standard and custom conversion events. Any adsets optimized for events outside of these eight will be paused. Facebook’s making it so that advertisers get to choose which eight they optimize for. If someone opts out of tracking via iOS14, Facebook will only track one standard event. So if you list Purchase as the number one conversion event, if the user purchases, that will get recorded. If the user does not purchase, Facebook will check the next most important conversion event and report on that. So be sure to rank them on importance from a tracking and reporting perspective.
- Note that if you want to use the Purchase event for ad set optimization but had previously set up custom events in the pixel like Purchase_downsell and Purchase_upsell (two custom events) you won’t be able to optimize against them separately anymore.
- If you’re running traffic for digital products or have a long form product page for physical products and you have advanced pixel configurations where you’re tracking behaviors such as % page scrolled, time spent on the page, % of video or webinar viewed, etc, note that you’ll lose the ability to optimize adsets based on events like these due to the 8-event limit if these don’t make it into your 8-conversion event set, so bear this in mind. However, you’ll still be able to track this in Ads Manager. Link clicks and landing page views don’t count towards this limit.
For you visual learners, Facebook provides a handy illustration outlining current state vs. how this will work for iOS14 users in the future:
- We primarily write for and serve physical eCommerce brands, but some of our clients sell both physical and digital products and use virtual summits or webinars to drive those sales, so it’s worth noting that for lead generation funnels - those with an opt-in, webinar or virtual event on the front-end and a sale on the backend - you must prioritize the order in which you list your conversion events based on the customer journey if you want to most effectively capture / track Apple iOS14 users in the future who choose to opt-out of tracking.
For example, let’s say you’re running a webinar or video sales letter to sell a digital or physical product and there’s an opt-in at the front of the funnel. The order in which you must prioritize your events will need to be: 1) Purchase, 2) WebinarRegistration, 3) Lead, etc. In other words, go with the conversion first. This is because Facebook will only be allowed to track a user for one conversion event in this use case, if that event hasn’t happened, Facebook will then attempt to track for the second conversion event in the priority list.
As you set these up, know that it may take another 24 to 48 hours to have everything validated. That means if you go the DNA verification route for domain verification, the entire process may take up to 5 days. So plan ahead accordingly when it comes to campaign launches or any other time-sensitive work when it comes to paid social on Facebook or Instagram.
- Expect and ready yourself for additional lost conversions (in reporting, not in actuality). Facebook’s never been entirely accurate in its reporting to begin with, since some conversions get lost due to cookie blockers or site technical issues (load speeds) which sometimes result in data never reaching Facebook. But with the upcoming changes, you can expect reporting accuracies to decline even further. Here’s how you can best prepare, courtesy of our friends at SMCommerce:
- Evaluate and assess just how accurate Facebook’s reporting currently is by reviewing sales and revenue against two other platforms - your Google Analytics account and the backend analytics of your eCommerce store. We recommend at least a quarter’s worth of data, but you can run this anywhere from 30 days to a year. Consider your eCommerce store data to be the benchmark from which you compare the others, given that source is obviously going to be the most truthful when it comes to purchases.
Below you can see that Facebook’s reporting 85.78% of sales and Google Analytics is reporting just 73.17% of sales. There is likely some underreporting / overreporting taking place on Facebook or GA, but the real purpose of this exercise is to run this quarter by quarter or even month-by-month for the past 12 months / four quarters. Then track this each month and each quarter going forward as well, and compare before iOS14.5 and after to quickly identify any changes.
- Consider an upgrade to Google Analytics 4.0 for additional AI features and deeper insights and look into its multi-channel reporting (if your brand has taken a multi-channel approach - which it should!) to better get a sense of where your sales are truly coming from. These reports can help you dive into how website referrals, searches, ads across multiple platforms, and email play in the conversion that’s ultimately reported in Google Analytics (which at that level, is only credited to the last campaign, ad, search result, etc. that the user took right before they purchased). Essentially you get a more comprehensive birds-eye view of how your various channels are working together to help you land the sale.
- If you aren’t already, get acquainted with and start using a third-party tool that uses multiple data sources to paint an overall picture of how your paid and organic traffic sources complement each other and work together to bring conversions and sales to your door. Here are just a few that may be suitable for eCommerce brands (these are not affiliate links; we don’t ask for or earn commissions on our recommendations so as to ensure we only recommend what is truly best for our network and clients):
- Hyros - this platform is more specifically designed for lead gen or digital products, but can be leveraged for eCommerce as well, especially if you’re a brand who has a phone sales team on the backend or who has a digital product or virtual event where digital or physical products are sold. At KRA, we have a number of eCommerce clients utilizing this platform.
- Elevar - This one’s specifically for Shopify stores, and we intend to test this platform’s capabilities on our elite KRA Platinum accounts. We’ll put together a case study / whitepaper on our findings, so remain on the lookout.
- Other recommendations that we haven’t used but have been mentioned by our fellow top-performing media buyer friends and mentors:
- Google Data Studio - cumbersome setup, but gets the job done for a fraction of the monthly cost of Hyros. We would recommend a GDS professional to set this up, however.
- DoubleClick - like GDS, I’ve heard the setup may be a bit cumbersome.
- Wicked Reports - better for digital product eCommerce or eCommerce that relies heavily on organic efforts. Great for subscription and SaaS business models as well. Be sure to bring in sources from Stripe and Paypal!
- Evaluate and assess just how accurate Facebook’s reporting currently is by reviewing sales and revenue against two other platforms - your Google Analytics account and the backend analytics of your eCommerce store. We recommend at least a quarter’s worth of data, but you can run this anywhere from 30 days to a year. Consider your eCommerce store data to be the benchmark from which you compare the others, given that source is obviously going to be the most truthful when it comes to purchases.
- Continue to Explore Additional Traffic Channels to Drive Conversions.If Facebook ads are the sole channel driving traffic to your brand’s eCommerce store (which it shouldn’t be), this is certainly something you should look into. Not because Facebook advertising will no longer work - that scenario remains an unlikely one for 98% of companies out there and certainly not for physical product eCommerce brands - but because you really do need to cast a wider net if you’re going to best position yourself for predictable, fast, smooth, profitable, and consistent growth.
Email and branded paid search is a given and as these already serve as top of the list of channels that best complement Facebook and Instagram, should be top contenders. SEO (organic search) and influencer marketing would be next on the list, and then and only then does it make sense for eCommerce brands to pursue advertising on Pinterest, TikTok, and other up and coming platforms beginning to offer advertising as a service.
Does the order really matter? eCommerce brands have been successful with email, Facebook, and Pinterest alone, sure. So the order isn’t exactly the most important aspect, here. It doesn’t matter as much as the need to diversify in and of itself.
Sure, the iOS14 updates bring a level of uncertainty and anxiety in the industry for many, but we still view Facebook and all the other traffic sources that will be impacted as remaining very effective tools for paid advertising and profitable growth for eCommerce brands.
This mantra was true long before iOS14, is true now, and will remain true long after iOS14.5 comes to market: Facebook is one of the best ad platforms to help eCommerce brands gain traction on the planet when it comes to sales. Hands down. But if you really want to scale - truly scale, which is really what we refer to as growth - you’ll always need more than Facebook and will need to consider the changes that will be required brand-side (expanding logistics, teams, customer service, tightening / optimizing departments, modifying systems and processes, sharpening fulfillment and inventory management, optimizing the supply chain or investing in vertical integration, etc). In short, you’ll need to evaluate how much scaling your business can actually handle before you can determine which traffic sources to consider adding to your arsenal. The speed at which you wish to scale will largely determine which traffic sources are truly right for your brand.
Be sure not to spread yourself too thin on these channels, however. Pay mind to your marketing budget and manpower and make sure your brand has the marketing resources to effectively utilize two to four channels very well. While a multi-channel and integrated eCommerce marketing strategy is critical for a number of reasons, being great at three is better than being mediocre at five.
- Don’t let tracking concerns hinder you from serious growth.
Over 100 years ago, John Wannamaker said “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” And to this very day, no agency, influencer, data scientist, or big-stage guru has cracked the code on measuring how well every single, solitary dollar and dime is performing. As a result, although the industry has certainly made huge strides in technology when it comes to tracking and attribution and the gaps of uncertainty have shrunk significantly, the savviest marketers still rely on proxies of information to fill in those small gaps.
Tracking is critical to cost-efficient, profitable growth via digital advertising. Just don’t let the possibility of hazier tracking stop you in your tracks from running traffic, testing new traffic sources, or developing growth for your brand. Your competitors certainly don’t. Educated, informed estimations that intelligently fill the gaps can still help you get (and stay) ahead of the game.
TO SUM IT ALL UP:
Phew, that was a lot, wasn’t it? Here are the key takeaways:
- The iOS14 ATT Framework is being rolled out, and the developer beta for iOS14.5 became available February 1st. The public version of the beta will be available for the public to download sometime in February, and the update will roll out to Apple’s devices in Q2 of 2021. Nobody will really know the full extent of its impact until we start to see some hard data in terms of adoption / opt-out rates, but advertisers running traffic to third-party page builders must research whether that platform is still the right fit for them given their tracking and optimization needs.
- There’s an entire universe outside of Facebook ads to explore and profit with that complement a savvy Facebook and Instagram advertising strategy beautifully - a universe that any savvy brand has already been exploring and mastering long before this iOS14 update came into view.
- There is a plethora of actionable items eCommerce brands can and should be doing, on the technical side, on the marketing side, and on the brand/business side to minimize impact to their profitability and returns - many of which should have been done long before Apple announced this update, anyway.
- The iOS14 update may serve as a hit to Facebook in terms of the quality of targeting, optimization, and attribution, but Facebook is far from being rendered impotent or ineffective when it comes to building relationships, acquiring new customers profitably, or retaining existing ones. Especially when there are steps and third-party options you can take to effectively and efficiently get the lay of the landscape when it comes to your marketing efforts and properly track your purchases.
There is much to do, we know. If you feel unprepared for these upcoming changes and would like our agency’s assistance to consult, architect, or execute and manage any aspect of what we’ve laid out in this whitepaper, or if you have other growth and scaling goals you’d like to achieve this quarter and beyond, then let’s see if we’re a good fit for one another. Get in touch here for a no-obligation session.
The following sources were used for research purposes. Credit has been given back to the original sources where appropriate, either in the article itself, or in the following list of references.
- Apple’s Ad Support framework: https://developer.apple.com/documentation/adsupport
- Apple’s ATT framework for developers: https://developer.apple.com/documentation/apptrackingtransparency
- Apple’s location privacy update: https://support.apple.com/en-ca/HT203033 and https://digiday.com/media/apples-new-privacy-features-rattle-location-based-ad-market/
- Apple’s Privacy Explainer: https://developer.apple.com/app-store/user-privacy-and-data-use/
- Apple’s Privacy Initiative https://www.apple.com/privacy/
- Apple’s SKAdNetwork developer kit: https://developer.apple.com/documentation/storekit/skadnetwork
- Apple’s iOS13 Adoption Rates: https://appleinsider.com/articles/20/06/19/ios-13-now-installed-on-81-of-all-compatible-iphones
- Curt Maly’s Facebook Domains Overview deck: https://www.dropbox.com/s/ujehj14y093e4mz/Verify%20-%20Facebook%20Domains%20Overview.pdf?dl=0&fbclid=IwAR3oJbL-wy0rFW6vC2A7i3_FkOlkJByTnrp0Mbhe-eD_tIDJewNSSFdfm5c
- Dee Deng’s explanation of the impact broken into a useful video format: https://www.facebook.com/realdeedeng/posts/10164591284100223
- Depesh Mandalia on iOS14 Guidance for Facebook Advertisers: https://docs.google.com/document/d/1pwKqQeaOgW5bCHNjJrj8fafRTBeojXQTV5pjcbC89wE/view#
- Facebook Domain verification: https://www.facebook.com/business/help/245311299870862 and https://developers.facebook.com/docs/sharing/domain-verification
- Facebook’s action points to prepare for the impact: https://business.facebook.com/business/help/126789292407737?id=428636648170202 and https://www.facebook.com/business/help/331612538028890?id=428636648170202
- Facebook advertiser cookie settings: https://www.facebook.com/business/help/560982207646475
- Facebook’s API training (cAPI): https://www.facebook.com/business/learn/certification/exams/520-101-exam
- Facebook’s Conversion API setup guide: https://developers.facebook.com/docs/marketing-api/conversions-api/set-up-conversions-api-as-a-platform/
- Facebook’s iOS14 event 7th Jan 2021 https://register.gotowebinar.com/register/6500844219187230224
- Facebook’s guidance to App Developers and Advertisers: https://developers.facebook.com/blog/post/2020/10/29/preparing-our-partners-ios-14-latest-guidance-on-skadnetwork/
- Facebook’s iOS14 announcement: https://www.facebook.com/business/news/preparing-our-partners-for-ios-14-launch
- Facebook’s iOS14 Advice for Mobile Web Advertisers: https://developers.facebook.com/blog/post/2020/12/16/preparing-partners-ios-14-mobile-web-advertising/
- Facebook’s ‘speaking up for small business’ portal: https://www.facebook.com/business/news/ios-14-apple-privacy-update-impacts-small-business-ads and https://www.facebook.com/business/apple-ios-14-speak-up-for-small-business/impact-on-ads-marketing
- Google Analytics 4.0: https://searchengineland.com/google-analytics-4-adds-new-integrations-with-ads-ai-powered-insights-and-predictions-342048
- Google Chrome’s 3rd party cookie phase out: https://www.adweek.com/programmatic/google-chrome-will-phase-out-third-party-cookies-by-2022/
- Google’s Product Privacy: https://policies.google.com/technologies/product-privacy
- Nick Shakelford’s insights and actions, diving deeper into iOS14 and Apple’s motivations: https://docsend.com/view/528khdiru5yb8gvr
- Simo’s server side GTM: https://www.simoahava.com/analytics/server-side-tagging-google-tag-manager/
- Setting Up Facebook’s cAPI on Shopify: https://www.getelevar.com/shopify/implement-facebook-conversion-api/ and https://www.foxwelldigital.com/blog/2020/10/7/facebooks-conversions-api-capi-and-how-to-implement-it-with-your-shopify-site
- Setting up Google Server Side Tagging: https://developers.google.com/tag-manager/serverside
- Zipify Page FAQ: https://help.zipify.com/en/articles/3416156-zipify-pages-faq