Facebook CFO says Apple privacy changes seriously attack the personalized advertising business model

Apple iOS 14 version brings many improvements in data and privacy, including strengthening camera and microphone permissions and turning off the personalized advertising mode by default.

Of course, these data and privacy improvements are beneficial to consumers, which will prevent advertising networks from collecting consumer information and conducting persistent tracking.

For advertising networks, the changes brought about this time may be devastating, because the click-through rate of personalized advertising content without data support will plummet.

It is also the case that the advertising industry jointly protested and communicated with Apple earlier, and finally Apple decided to postpone the default shutdown of the personalized advertising model until early next year.

Both Apple and Android systems have advertising identifiers. The so-called identifiers are specific strings generated from device information to identify users.

The advertising network has the authority to read the identity identifier so that it can be used to identify and track users, such as which content and products users are interested in before pushing advertisements.

To give a simple example, after searching for certain products on certain e-commerce websites, we may open other apps or websites to show corresponding product advertisements.

This is personalized advertising, that is, accurate advertising based on interest. The click-through rate of this type of advertising is much higher than those that are not associated with users.

What Apple did in iOS 14 was to change the personalized advertising mode that was originally turned on by default to the off state, unless consumers were willing to actively turn on personalized advertising.

In this case, the advertising network will not be able to identify and track users and cannot push personalized advertisements, so the conversion rate of the advertising network will plummet compared to the past.

Of course, Apple also allows apps to request users to turn on the personalized advertising function, but only after the user agrees and manually turns it on.

The social network giant Facebook is currently one of the largest advertising networks in the world, and Apple’s personalized advertising changes will also have an impact on Facebook’s advertising business.

Previously, after testing on Facebook, it was found that iOS14 will reduce the click-through rate of ads by up to 50%, which means that for Facebook, the advertising business will lose more than 50%.

It is also true that the CFO of Facebook recently said that entrepreneurs and the tools they rely on are being threatened, which will cause serious damage to entrepreneurs.

The CFO of Facebook said that the changes proposed by Apple are huge and hurt developers and companies a lot. Companies should also defend this personalized advertising model.

Facebook believes that using IDs to track users is valuable, and Apple mainly relies on selling hardware and subscription services, rather than relying on personalized advertising models.

The chief financial officer said that Apple earns a lot of income from consumers because Apple does not rely on advertising so it does not care about the life and death of advertising participants.

Currently, groups organized by advertising networks are discussing this matter. These groups will have dialogues and even protests on Apple’s changes in order to survive.

Via: appleinsider