As part of iOS 14, Apple made some big changes that will affect anyone that is running Facebook ads. Apple's changes are made in an attempt to improve user privacy at the cost of the ability to accurately target ads and measure ad performance. In this article, we'll take a look at the specific changes Apple is making and how they will impact your Facebook ads.

The main change Apple is making is they are setting strict guidelines on what information third parties are allowed to track about iPhone users. In order for an app to be approved for the App Store, it must comply with Apple's guidelines. This impacts you if you either are advertising an iPhone app or your ads are displayed in an iPhone app such as the Facebook app.

Measuring Ad Conversion Rate

The biggest requirement Apple is making is they are restricting the amount of information advertisers can collect when a user clicks an ad. Previously when a user clicks an ad in the Facebook app, Facebook would provide the advertiser with a unique identifier called the fbclid. If the user winds up purchasing the advertisers product or performing some other action desired by the advertiser, the advertiser can send the fbclid back to Facebook. Facebook can then use the fbclid  to determine the specific user that performed that action. Facebook uses this information to measure the effectiveness of ads shown to users and optimize its ad targeting algorithms.

Under Apple's new guidelines, Facebook is not allowed to provide any sort of user identifier to the advertiser when a user clicks on a Facebook. Apple has introduced a privacy focused alternative called Private Click Measurement or PCM for short.

What is PCM?

PCM is Apple's new way for allowing advertisers to measure ad conversions without tracking individual users. PCM works by having the ad conversion tracking happen on the device that performed the conversion instead of on the website where the conversion was performed. After a user clicks on a Facebook ad, their device will record they clicked the ad. If the user then performs a conversion event, the device will tell the advertiser that some user performed the conversion event. There are several big differences between PCM and the old way of measuring conversion rates:

1. No information that identifies the device is sent to the advertiser. This allows the advertiser to determine a conversion happened, but not know which specific user converted.
2. The device will wait 24-48 hours before sending the data to the advertiser. This will delay any ad reporting you have set up.
3. The amount of information about the conversion the device will provide back to the advertiser is limited to 4 bits.

The last point is huge! That means all an advertiser will be able to tell about a conversion is that one of sixteen different events happened and no other information will be provided. Currently if the ad conversion includes purchases a product, it's common for the advertiser to want to know what the price of the product purchased. That way the advertiser can know which ads result in higher purchases. Under PCM, this use-case will be severely limited. The way Apple recommends to get around this problem is to use different conversion events to correspond to different price points. For example, you can have one conversion event that corresponds to between $100-250, a second one that corresponds to $250-500, and a third that corresponds to $500-1000, but this quickly uses up the limited 16 events.

What Changes are Facebook Making?

Facebook is making several changes to make use of PCM. In particular:

1. They are limiting the total number of iOS campaigns you can run to nine.
2. They are requiring you to prioritize the conversion events that are most important to you. You will only ever receive conversion information about the eight most important conversion events.
3. Data on iOS campaigns will be delayed for up to three days.

Tracking Users Across Apps

The other big change Apple is making is making it harder for advertisers to track users across multiple apps. They are doing this by disallowing apps from accessing the "IDFA", unless the user explicitly gives permission for the advertiser to do so.

Every iPhone has a unique identifier called an IDFA. This allows any advertiser that has access to the IDFA to uniquely determine who the person who is using the app is. In particular, the Facebook SDK, which is installed across many different apps, is able to track individual users as they use different apps. In this way, use of the IDFA is very similar to third party cookies.

Historically the IDFA has been used for three different ways:

1. If a advertiser is advertising a mobile app, they can use the IDFA for attribution purposes. When a user clicks an ad in a mobile app, the advertiser will receive the IDFA for that user. If that same user downloads the advertised mobile app, the advertiser can use the IDFA to determine which ad the user clicked on led them to download the app.
2. Advertisers can target ads based on a particular user's interests. Because Facebook is tracking a user across the different apps they use, Facebook can determine what types of apps a particular user likes and target ads to them to show them ads for similar apps.
3. Advertisers can target ads to users based specifically on their IDFA. This works very similar to the way retargeting for traditional web advertising works. If an advertiser has multiple different apps and wants to show their existing users ads for their other apps, they can provide Facebook with a list of IDFAs to show a particular ad to.

With Apple restricting use of the IDFA, all these use cases will be hampered. With the percent of US users allowing access to the IDFA limited to ~5%, these strategies are going to be limited to a much smaller pool of users.

Conclusion

With all the changes Apple is making, you should expect to see the performance of all your iOS Facebook campaigns go down. You will see more limited reporting, the conversion rate of your ads go down, and your cost per conversion go up. Fortunately Apple has provided the Private Click Measurement feature that makes it possible to measure ad conversion rates while still following Apple's new guidelines. Going forward, it will be interesting to see what new technologies are introduced to improve mobile advertising while complying with Apple's new guidelines.