Apple's ATT: One Year Anniversary and the Industry Impact

On April 26th, 2021, Apple started rolling out iOS 14.5 with its App Tracking Transparency framework into the market and defined new rules for the ad ecosystem: iPhone users now explicitly needed to give their consent to share their IDFA with each respective app. No consent means no IDFA for ad monetization or attribution, and even fingerprinting was forbidden as per the Apple Developer Program License Agreement. For this, Apple is offering their data-limited attribution alternative with SKAdNetowrk (SKAN).

If you are reading this, you might be familiar with the latest debates about if and how Apple will be policing fingerprinting and that marketers still groan for real-time attribution to do their work similarly as they used to do. At least ad spending is increasing when such tools are being offered, i.e. Facebook’s “aggregated event measurement” and Snap’s “privacy-preserving first-party measurement” (yes, they use such fancy names). SKAN alone seems to be not actionable enough.

But here I want to dive into some numbers on how the landscape developed over the last year. I will look at data from the ID or no ID dashboard, which is provided by the Remerge DSP, and give transparency to the programmatic landscape with 26 supply partners and hundreds of millions of users across hundreds of thousands of apps.

ATT Global Adoption

Starting with iOS 14.5 users started to see the opt-in popup in apps.

It took three months to cross the 50% adoption and then another three months to cross the 75% adoption rate. It is still increasing month over month and right now we are at 87% ATT adoption globally.

iOS Bid Requests with ID

While Attribution provider Adjust states that the opt-in rate grew from 16% in May 2021 to now 25%, let’s look at the iOS ad inventory with IDFA development over time:

Before the rollout of iOS 14.5, we see 1.9 trillion bid requests per month with an IDFA on iOS. This declined over time to a minimum of 1.0 trillion bid requests in December 2021, a 47% decline in inventory. The drop over time has been expected as the percentage of iOS 14.5+ versions gradually increased. It stabilizes then and even grows again, similar to the observations from Adjust.

But that actually doesn’t look so grim, there is still more than 50% inventory with ID available despite ATT. This is far more than the 25% opt-in rate. Is it because these are older versions? No, the majority of requests with an IDFA come from the newest OS version. There is a different reason.

Looking at Android

When we compare the iOS inventory development with the Android development at the same time, we can see something interesting:

The inventory grew in the last year by 80%! This is in line with other research and reports that state that mobile app usage surged strongly due to the pandemic and eyeballs are moving from other channels faster to mobile. Consumers have learned (and love) to use apps now - not only for playing but also for buying.

Now putting things in perspective, the iOS inventory drop of 47% is still significant when the ecosystem is actually growing by 80%.

Price Inflation Everywhere?

Based on an analysis of Arete, in Mobile, pricing was negative for the iOS ecosystem after Safari and IDFA restrictions; Android CPMs opened up a 30% gap over iOS based on the availability of IDs. Apps like Bumble spoke of “a rush to advertise and acquire on Android” leading to price inflation, while Farfetch saw “demand generation” costs rise 39% and 60% in 2Q21 and 3Q21, respectively.

The following graph shows the eCPM development (iOS yellow, Android red). The drop of iOS happens after the iOS 14.5 rollout in April.

After the iOS ATT rollout, Android for the first time ever got more expensive than iOS. Marketers avoided iOS due to the uncertainty in measurement. It recovers a bit, but we still see a 50% lower CPM on inventory without an ID compared to inventory with an ID. In the last year, iOS was the only digital marketing channel where prices didn’t increase but actually decreased.

Looking Forward

We have reached the peak of the iOS ATT adoption rate with almost 90% of users having a newer iOS version than iOS 14.5. While the size of the iOS inventory with an IDFA dropped only about 50% compared to pre-ATT, the ecosystem with its userbase grew by a strong 80% in this period. This means that actually there is still enough room to test out iOS ID-based strategies instead of completely circumventing them. And it also looks like the inventory can only continue to grow from the current basis as we've reached the peak in ATT adoption as long as the app market is growing.

On the No-ID side, prices for iOS users without an ID are still low, but the trend is shifting as marketers are getting experience with the new measurement tools. The opportunity is just too big to not tap into the valuable iOS user base. And Android is also coming with an updated privacy advertising framework. Contextual targeting will also get better and better over time due to higher investments in this area and ad prices will then increase again - which will finally make iOS publishers happy again.