How Apple’s iOS 14 Update Will Impact eCommerce Brands In 2021 (+ What To Do About It)

It’s been discussed for quite some time but Apple seems ready to deploy the highly-anticipated change that online advertisers have been dreading.

  • What is the change? 
  • How will it affect eCommerce businesses? 
  • Is the digital sky falling?

Let’s break it down and look at how eCommerce merchants and advertisers may be affected in the coming months… We’ve also asked 2 industry experts to weigh in and give their hot take on the iOS situation.

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1 – What is the iOS 14 update?

In a nutshell Apple has decided to prioritize user privacy over targeted advertising. 

The update of iOS 14 will alert users with the option to turn off tracking for any app they use on their phone (such as Facebook). It’s worth noting that users will have the option to opt out of tracking — it’s not an automatic application.

Here’s how the change will play out (in non-tech-nerd English)…

IDFA (Identifier for Advertisers) is a unique identifier for mobile devices. It’s used to target ads and measure their effectiveness (on a user level) across mobile devices. And as stated above, Apple will now make it super simple for users to block the sharing of this unique identifier. Currently, about 70% of iOS users share their IDFA but after this change it’s estimated that this number will drop to 10% to 15%.

Apple says this is about planting a flag for user privacy. Which seems like a noble cause. 

While Apple did release the iOS 14 operating system back in September of last year (2020), they delayed the change that would impact targeted advertising. Apple has previously said that change would be coming in “early 2021” and it seems D-Day is almost upon us.

2 – Which marketing channels will be impacted by Apple’s new policy?

Does this change mean brands will need to go back to putting homemade signs on the side of the road? Well, thankfully, you can put that paint can away for now…

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However, brands advertising on Facebook and Instagram are likely to experience decreased abilities in regards to tracking, attribution, targeting, and personalization. Similarly brands advertising on Google with Display, Video and other campaigns promoting web-based conversion goals are also likely to experience a negative impact on ad performance — with iOS users.

It’s worth noting — Facebook and Google are both working on solutions and workarounds to ensure advertisers can continue to generate good results for their business. But for brands relying solely on new customer acquisition, instead of customer lifetime value, this could be the wake-up call they need.

INDUSTRY EXPERT INSIGHTS – JUSTUNO

How do you see the iOS update impacting eCommerce brands in 2021?

“The iOS14 update will be significant, but not earth-shattering. Expect declines in your conversion rates, reduction of targeting capabilities, and a more manual, time-consuming process for creating new ad campaigns. However, there’s substantial ambiguity and the full impact won’t be known until after the update takes effect. Stay on your toes and be ready to pivot.”

3 – How will email marketing be affected by the iOS 14 update?

Here at Andzen, we’ve been raving about the importance of building your “owned audience” and first-party customer data for a long time. And this change to iOS is yet another example of why your email, SMS, and Messenger lists are so incredibly valuable to your brand.

It’s no secret that Andzen’s email service provider of choice is Klaviyo. So let’s use Klaviyo as an example to look at whether this change is likely to impact email marketing capabilities.

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Thankfully, it seems that this new change shouldn’t have any impact on Klaviyo sending and tracking capabilities. This is because Klaviyo uses first-party cookies and last click attribution. Again, these are the perks of owning your audience data, instead of renting your audience through an ad platform such as Facebook.

INDUSTRY EXPERT INSIGHTS – ANGELA PONSFORD (TIER ELEVEN)

How do you see the iOS update impacting eCommerce brands in 2021?

“Once the prompt starts showing, businesses that use these apps to market & track users will likely experience a drop in the effectiveness of their marketing spend due to increased difficulty with tracking and loss of “signals” from the users that opt out of tracking.”

How will email marketing be affected?

“Not much! The beauty of email is that once someone willingly gives you their email address, you are able to continue emailing them until they opt out!”

How do you view the importance of owned channels such as email?

“Lead Generation is going to become vitally important to all businesses in 2021, along with taking a more holistic view of overall marketing performance. Business owners will need to start shifting their thinking on how paid advertising works to bring in new customers and drive long-term business growth.”

So what’s the best next move for eCommerce brands?

4 – How should eCommerce merchants react to this change?

In the debate of owning vs.renting your audience, we’ve made our opinion clear — owned audiences (email, SMS etc.) provide brands with far more long term stability, predictability, and control.

Data capture, customer journeys, customer loyalty, and customer lifetime value are becoming increasingly important. With that in mind, here are some marketing plays that should absolutely be in your calendar for the year ahead:

  • Personalized customer journeys
  • Email marketing and automation
  • SMS marketing
  • Messenger marketing
  • Referral programs
  • Loyalty programs
  • Influencer marketing

You need to ensure you’re capturing user information whenever possible. Capturing emails is more crucial than ever. And their value is only likely to increase as other IDs start to fade away.

The long and short of it

If you’ve been building a brand and building your owned audience you should be totally fine. However, if you’ve been solely focused on new customer acquisition, it’s time to make a change.

Here at Andzen, we specialize in customer journeys and lifecycle marketing across all of your stores direct marketing channels. If you’re looking to capture more data from your site visitors, nurture first-time buyers, and drive more repeat sales — we can help! Our expert team strategically create beautifully-designed, highly-personalised, conversion-focused touchpoints, for each stage of your customer journey.

Check out some of our past work here and reach out to us today for a no-obligation chat.

Author:
Hi, I'm Luke; Creative Director at Andzen. Some people appreciate vintage cars—others appreciate American West Coast IPAs. I appreciate words, sentences, songs, books, and creative use of the English language. After growing and selling my own eCommerce brand I now use everything I learnt to help other eCommerce brands grow their reach and revenue. I enjoy working with inspired entrepreneurs who are looking to launch a product that truly 'shakes things up' and changes people's lives.

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