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Like Google’s ongoing plans for the demise of the cookie, Apple has thrown a similar wrench into the world of app monetization. With the addition of iOS 14.5 and the App Tracking Transparency Framework, app and game developers who previously relied on the App Store to access user IDs are concerned.
It’s no different than cookies for websites where technology has enabled publishers to be lazy in collecting user data. Developers who have worked hard to collect user data will have to do much less to keep their games monetized. As a result of Apple’s recent changes a lot of questions are being raised about the future for developers, let’s break down what’s going on.
A wake-up call
For apps that generate revenue through an initial installation or subscription, Apple’s change won’t have a big impact. These developers already have access to the required data and do not rely on additional marketing services such as coins, avatars, etc. under the funnel. But for developers who collect user data for re-targeting depending on the App Store, Apple’s recent updates are a big challenge.
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Look at the demand
So what does this mean for other players in space?
Apple has certainly created some cracks with this move. Facebook is also joining. I don’t know if Google will make a similar move, but for now, the advertising dollar is expected to inevitably move away from Apple’s App Store. The iOS budget has fallen 15% since April, according to Apsfly’s analysis of ખર્ચ 7.5 billion in U.S. spending. Days of pre-app tracking transparency (ATT) implementation, while the cost of Android remains the same. As more ad traffic emerges on Google Play, bids will increase and costs will decrease, creating the perfect storm for Google Play to dominate in the short term.
Do customers care?
Do customers really hate being targeted by the apps they already use? According to the same Apsflyer study, the ATT opt-in rate is much higher than initially expected, which is 45% overall. Information overload becomes a part of our daily lives, that data needs to come to us, so we don’t have to go in search of it. I love it when Netflix tells me there are new episodes of the show that I watched six months ago. Does it violate my privacy? Maybe, but this is a great way to use my own habits to benefit me.
It really comes down to the quality of the material. If it’s a game you really love, you’re more than willing to give up your privacy. There is more reason why developers need to get in the habit of collecting user data (with consent of course).
One lesson for all
Based on conversations with various app developers, the adoption of iOS 14.5 is estimated at 15% – and there are still early days for developers to address some of the challenges that this change will bring. While Apple is very focused on design and user experience, Google is more data-driven એક an approach that works well for marketers who want to drive positive ROI.
And, for publishers – always collect user data. If you rely on third parties to target and are not collecting your own first party data, you are giving up your power and risking your revenue stream.
It’s time to rethink how to collect and monetize user data. Think of this as a reset to identify and familiarize yourself with users. Who understand that sooner rather than later more changes will follow.
Ram Rao is the GM of mobile apps at Fluent, Inc., where he leads efforts to grow the portfolio of award-focused apps..
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