Facebook has been kicking and screaming since Apple officially announced its privacy feature, App Tracking Transparency (ATT). The feature that empowers iOS users--who account for nearly 50 percent of the U.S., smartphone market--to opt-out of data collection holds the power to devour much of Facebook's $86 billion annual revenue, of which nearly 98 percent is acquired through its advertisers.
Facebook has been trying to convince the world that it's not just bad news for Facebook, but also bad news for businesses. But actually, Apple ATT might prove great not only for Apple users but also for those using Facebook and Instagram for business.
Here are the five things Facebook doesn't want you to know about why Apple ATT is good for business:
1. Less Noise
Facebook is noisy. In fact, the number of businesses advertising on Facebook more than doubled from 2018 to 2020. Meanwhile, the number of Facebook users has steadily dropped in the same period by over 20 percent. As competition increased for ad space, Facebook created more ad placements, leaving its users getting hit with ads from every angle, from in-feed and stories to banners and messages directly to their inboxes.
The Apple ATT feature will help reduce noise, giving businesses on Facebook a better chance at grabbing and holding the attention of users. Fewer ads mean people won't be distracted by your competition when they're visiting your business page or involved in a Facebook group.
Additionally, ads have managed to become so advanced, they've become borderline creepy. Instead of looking at an ad and thinking how it's exactly what you need, you're left cringing at how odd it is that it's showing you this. And if your business is one that's raising the red flag in the minds of your audience, then your ads aren't helping your business--they're damaging it.
2. Decreased Costs
In an ad auction platform, pricing is based on the amount of competition around a keyword, or in the case of Facebook Ads, a target audience. So, if the Apple ATT feature leads to fewer users seeing ads, what that means is that audiences will be smaller. A smaller target audience should mean lower costs--especially for advertisers using the cost per 1,000 impressions (CPM).
It's not just good news for advertisers that use the CPM bidding model. As the Apple ATT leads to a decrease in audience size, the number of advertisers will likely decrease as well. And so with fewer advertisers, there's less competition. If Facebook Ads is a true ad auction platform, this would also mean lower costs for those on a cost-per-click (CPC) basis. And the lower cost doesn't mean lower quality.
3. Increased Quality
Facebook earns advertising revenue by quantity, but advertisers really depend on quality. With Apple ATT, advertisers on Facebook will see higher quality ad targeting as users who opt-in are more likely to make a purchase. In other words, not every user will want to opt-out of ads, and those who decide to continue to see ads are likely those with buying intent.
So, what Facebook advertisers will get post-Apple ATT are the types of users who may enjoy the convenience of receiving ads that enables them to discover products or services they're actually looking for from businesses they simply hadn't known existed.
4. Improved Organic Reach
Facebook wants businesses to think that fewer users seeing your ads will mean fewer opportunities to connect with users of Facebook. However, there are still a number of ways to generate brand awareness from social media from Facebook groups and brand partnerships to good old word of mouth and influencer marketing.
In other words, this might drive businesses to seek alternative social media and marketing channels, which may be lower cost and yield a higher return. While this might require a bit of upfront work, Apple ATT might be the push some advertisers need to invest in long-term organic growth strategies, rather than depending on short-term wins from paid social ads.
Without ads, users who are interested in your brand may be more likely to follow your business on Facebook. This way, they can see your content directly (ahem, for free) rather than depending on your ads.
5. Facebook Will Innovate
With Apple's new ATT feature, Facebook will be forced to do better, and this could lead to major improvements that could provide a better experience for its users while increasing its value for its advertisers. While this may be scary for Facebook as it is now, this could be great news for small businesses and users alike.
As much as Facebook wants to get people on its side in its battle with Apple, the reality is that the Apple ATT feature gives users more control over the content they see. And if someone doesn't want to see an ad, as a business, it's better not to show ads to that person. So, while Facebook wants you to fear losing revenue generated through Facebook Ads, the reality is that increased privacy and data protection features will benefit advertisers too.
Between its constant slew of court battles and its title as the least trusted social network, it's clear Facebook has already lost face. And in the wake of Apple ATT, Facebook is not just losing revenue, but its mind. Facebook got comfortable, and in doing so, it made the grave mistake that commonly lands startups in the ground by focusing on profits instead of people.
By thinking that all it needs to do to maintain its success is the same thing that made it successful in the first place, Facebook has been distracted by profits and has lost focus on serving its real audience.