iOS14.5’s Impact on Facebook Ads Performance: What We’ve Seen so Far
It’s been about 8 weeks since Apple pushed the iOS14.5 update live for iPhones and iPads around the world. Everyone in the PPC industry was waiting for this update to launch and anticipating major impact to how FB/IG ads operate and perform. This update was probably the biggest single change in the paid social landscape for years.
Our team spent a considerable amount of time preparing for the update, going through Facebook’s configuration updates for iOS14 including verifying domains, prioritizing events, and explaining the impact to our clients.
The mood internally and with OpenMoves clients around iOS14 ranged from pessimistic to extremely worried, with some clients wondering if Facebook performance would completely die after the update.
CPMs Spiked for Many Clients Immediately After the iOS14.5 Update
Here’s what we’re learning about 8 weeks after the update.
- We didn’t fall off a cliff. We had actually zero advertisers as clients who stopped running FB/IG ads due to iOS14 updates. We had a few that reduced or reallocated Facebook Ads spend to other channels. Many clients saw an on-paper performance reduction due to a shortening of attribution windows, but it wasn’t dramatic. The total net loss of spend and performance for our paid social group was less than 20%.
- Attribution and reporting was wonky, but now it’s making more sense. We were well prepared internally for the update, and we did not see any advertisers go offline or get “broken” in the immediate aftermath of iOS14. However everyone’s shared understanding of how FB was doing attribution and how reporting platforms were pulling data was very wonky initially. Now we think we have it largely figured out: attribution is set within AdSets, maximally to 7 day click + 1 day view. Reporting platforms have been able to get this working too by this point, and everyone is back to understanding more or less what’s being reported on. (With the important caveat of Facebook’s estimated reporting still having an unclear impact on real results.)
- Advertisers and investors are staying the course. As of this article, FB is trading at over $300 per share, a substantial all-time high. Clearly Wall Street does not think privacy updates are going to kill FB’s advertising business. The Wall Street Journal reports, “Facebook has said it expects iOS changes to begin to have an impact on its business in the current quarter…growth rates to “significantly decelerate” sequentially in the third and fourth quarters.” However, “The company said on its first-quarter conference call that its average price per ad in the first quarter increased 30% year-on-year”. This is consistent with our experience – CPMs are high on FB/IG even with iOS14 hitting, impression growth will slow YoY as people spend less time online in summer, and competition on the platform will still be high, despite pressure from iOS14.
- Facebook is still working out the details. It’s obvious that Facebook, despite their efforts on a proactive response, was not that prepared for Apple’s moves on privacy. There are a few clearly unfinished parts of iOS14 compliance that we hope will get worked out soon. For example on domain verification, right now FB support told us they have no official process for manually reclaiming domain verification. If someone else claimed your domain, unless you can convince them to release it, you’re stuck. We hope Facebook is better prepared to lead their platform direction in the future and not get caught by surprise again.
- We didn’t see the winners and losers we expected. We had developed a narrative internally that we expected to see some winners and losers emerge from the iOS update. For example, we’d expected clients with long sales cycles that relied heavily on remarketing to suffer, while we expected clients with low prices and quick sales cycles relying heavily on prospecting to win. Though this overall view is probably still valid, we didn’t see it starkly reflected in our client performance. A related example – we have a client with a focus only on prospecting for inexpensive leads through FB’s native Lead Ads. We expected they might be a post-iOS winner, given that they would have zero impact from the update while lots of advertisers would get hurt. In fact, their performance has been largely flat through Q2.
- In the end, pixels are dead anyway. Ultimately the iOS14 move was really just another (admittedly big!) step on the path towards a no-cookie future. Google joined this discussion in a big way in January 2021 with their announcement of Chrome’s sunsetting of 3rd party cookies and the FLoC technology that will replace traditional cookie remarketing. Facebook’s own Conversions API is a native, server-to-platform connector for FB Ads that gets around cookie and privacy issues and will probably be the main and instrumentation tool for FB/IG ads in the near future.
How did your performance marketing strategy adapt to IOS14? Are you prepared to advertise in a cookieless future? To learn more about our performance marketing solutions for paid social, contact an expert today.