Android ad prices rise after Apple’s App Tracking Transparency

Advertisers have started shifting their budgets to Android ads after Apple’s controversial App Tracking Transparency framework went into effect requiring them to get user permission to track user data.

Since the ATT framework came into effect in April, millions of iOS users who have upgraded their devices to Apple’s latest operating system received prompts which ask them if they want to allow apps to track their data. 

Also Read: Everything to Know About Apple’s iOS 14.5 Update

According to Branch Metrics (via WSJ), more than 70% of iOS devices have been upgraded and less than 33% of them allowed ad tracking while the majority have declined.

As a consequence, Android ad prices started to rise as advertisers deeply worry about the effectiveness of ads targeting iOS users.

According to Tenjin, spending on iOS ads decreased by nearly one-third between June 1 and July 1 while spending on Android ads increased by 10% at the same time.

Tinuiti Inc.’s Director of Research Andy Taylor said that they also have observed a similar shift in their customers’ ad spending. The year-over-year growth of Tinuiti’s Facebook clients’ Android ad spending rose 46% in May to %64 in June and Android ad prices are now nearly 30% higher than iOS ad prices,  Taylor said.

He added that this resulted in a growth in overall spending on Facebook advertising as well as on the social media giant’s Audience Network tool which allows advertisers to buy and show ads in third-party apps.

Taylor said that Tinuiti clients spent 50% of their Audience Network budgets to target iOS users in early April and this dropped to 20% by the end of last month.

After the App Tracking Transparency feature went into effect, advertisers turned to other ad tools offered by Apple-rivals Facebook and Google.

Google is reportedly looking for an alternative to Apple’s ATT and recently announced that it’ll soon delete advertising ID when a user opts of out of ad personalization.

Also Read: Google will enforce Android apps tell users about data use next year

Meanwhile, Facebook has been one of the most vocal critics of App Tracking Transparency since the iPhone-maker announced the feature last year.

The social media giant even ran full-page newspaper ads in major papers and an ad campaign named ‘Good Ideas Deserved to Be Found’ which appeared on TV, radio and digital platforms for 12 weeks.

In August last year, the company released a blog post and said that they might shut down Audience Network due to Apple’s new advertising rules.

“Third-party data tends to be unreliable and not representative of our business,” a Facebook spokesman said. “While we expect iOS 14.5 to be a headwind for the remainder of the year, the impact on our business will be manageable. What’s most concerning is the impact to the smaller developers and businesses who rely on personalized advertising.”

Also Read: Small developers will be hit hardest by Apple’s ATT framework

In March this year, Facebook founder and CEO Mark Zuckerberg said: “I think it’s possible that we may even be in a stronger position if Apple’s changes encourage more businesses to conduct commerce on our platforms, by making it harder for them to basically use their data in order to find the customers that would want to use their products outside of our platforms.”

It’s worth noting that the majority of Facebook users are said to be Android users so the rise in Android ad prices could be highly profitable for Facebook.

Since Apple’s advertising changes were put in motion, Facebook has made important changes to its Audience Network which heavily depended on Apple’s IDFA.

Last week, the company sent advertisers an email announcing that it’d allow them to run contextual ads which can help increase ad relevance.

“Showing contextual ads in addition to personalized ads is part of our efforts to help support publishers”, the company wrote in the email.