Apple Search Ads is a powerful acquisition tool for app marketing that has been around for several years. It’s a proven method that connects advertisers with a relevant target audience to increase conversions. Using Apple Search Ads, app developers can drastically improve their visibility in the App store, thereby gaining an edge over competitors. And with two different solutions offered—basic and advanced—advertisers can implement either simple or complex campaigns, depending on their organization’s goals.
While Apple Search Ads are a gateway for advertisers to convert more users, users are hyper-aware that companies are trying to glean as much information as they can to track them. Consequently, privacy settings in Apple’s mobile ecosystem are growing ever-more stringent. More and more users are tapping into Limit Ad Tracking (LAT), a simple but sophisticated feature that can be enabled on their mobile devices to prevent data collection by apps and to help maintain privacy rights. Limit Ad Tracking disrupted the advertising space simply by providing users the option to safeguard their personal data.
iPhone devices now make up approximately 45% of the US smartphone market and users are turning on Limit Ad Tracking (LAT) to feel safer. This means advertisers face new challenges as they launch their App Store search ads to connect with iOS users.
Share of Apple iPhone users in the U.S. from 2014 to 2021
What Is Limit Ad Tracking (LAT)?
Limit Ad Tracking (LAT) is a feature on Apple’s mobile OS that gives users a choice to opt out of having an ID for Advertisers (IDFA) and can be turned on from a user’s Settings app. When this setting is on, networks are unable to locate an identity associated with a device, and users who seek privacy protection do not receive unwanted targeted ads.
While LAT doesn’t completely block ads, it prevents targeting users based on their behavior, and ad tech companies can’t collect as much data as they normally would if the setting is turned off. Rather, tracking is largely limited to contextual data points such as the device’s OS version, the app store subcategory, the version of the app, and so on.
LAT was the predecessor to App Tracking Transparency, or ATT. Both iterations are Apple’s way of letting users choose to decline personalized ads. Essentially, the opt-out prevents Apple Search Ads from recognizing the user as a returning customer and using their information to serve more relevant ads.
While previously referred to as the Limit ad tracking (LAT tracking) feature, Apple’s verbiage of choice is now “personalized ads”. Instead of turning on LAT tracking to prevent personalized ads, users with iOS 14+ can simply turn off the personalized ads feature.
Users who choose to guard their privacy with either version of the feature prevent advertisers from targeting them through any aspects of their Apple ID. This includes demographic and search data.
With so much riding on whether or not a user consents to personalized ads, you might be wondering if the initial ATT prompt is your only chance to acquire ATT consent. Users can turn off the “Allow Apps to Request to Track” option in their privacy settings. If they enable the requests, advertisers have one chance to request ATT permission. If the user denies the native ATT prompt, you don’t get another chance.
At this point, your only option is to provide information in your app informing users on the benefits of tracking, as well as how to adjust the settings to enable it.
Why It Matters for Advertisers
As more users enable the LAT feature on their devices, advertisers are being hit with a big challenge. Many users see LAT as a privacy-preserving tool. For advertisers, however, it reduces their ability to reach their target audience. The implications for marketers are not favorable; here are some of the reasons why.
- As the mobile marketing era shifts, user information will no longer be automatically collected. Rather, the user will have to provide it voluntarily, either willingly offering their information or denying it. While users feel more secure using the LAT feature, mobile marketers are unable to access as much information as they were able to previously.
- The App Store may remove an app that uses an iOS ad identifier outside its intended purpose—and understandably so. A user's Limit Ad Tracking settings should be respected.
- If user privacy rights are violated, a developer's app risks its reputation, and users are likely to turn to competitors. The LAT feature has created new challenges for mobile marketers, urging them to step up their game or lose a user’s attention.
- For opted-out users, lack of attribution makes it harder for advertisers to measure the success of campaigns.
Impact of LAT on attribution
Prior to iOS 10, companies did not have to honor the user’s LAT request. Apple also previously allowed companies to use permanent device identifiers (called universal device IDs or UDIDs) for frequency capping, attribution, conversion events, estimating the number of unique users, advertising fraud detection, and debugging.
Once iOS 10 entered the picture, Apple began showing zeros in place of the user IDFA for those who selected LAT. IDFA stands for “identifier for advertisers” on Apple mobile devices. It’s like a web cookie, but for ad tracking. An IDFA notifies advertisers when an iPhone user takes a certain action on their ads or apps.
iOS 14 changed the game by only assigning IDFAs to those who explicitly opt into tracking. IDFAs let advertisers know when a user takes an action as a result of an ad. They’re also used for fraud detection. Post-iOS 14, advertisers have to use Apple’s SKANetwork (StoreKit Ad Network) to get attribution data per campaign and marketing channel without device-level data for privacy safety.
What to do about Apple’s App Tracking Transparency pop-up
After updating to iOS 15, users receive a prompt explaining what personalized ads are, equipped with buttons for the users to turn the feature on or off. Apple’s data on their first-part advertising efforts shows that when prompted, 78% of users opt to turn off the personalized ads feature.
The same data revealed that the conversion rate between users with personalized ads on and off are practically identical. Advertisers report a 62.1% conversion rate for customers who opt in and a 62.5% conversion rate for those who opt out.
In response to this data, Apple recommends developers target users with the feature disabled as they are far greater in number. Because there are more users with the feature disabled, bidding prices for that audience are lower.
How does LAT tracking affect campaigns
Advertisers who choose to target users based on demographic data like age or gender will not reach those who opt out of personalized ads. Those who don’t target using demographic information will automatically advertise to LAT-on users.
- LAT-on users don’t share identifying information with Apple Search Ads. This includes age, gender, user behavior, etc. If you use these criteria to refine your audience, LAT-on users will be excluded.
- Targeting LAT-on users is not an option. Advertisers can target either LAT-off users or both LAT-on and LAT-off users. Geographic targeting doesn’t exclude LAT-on users. Discovery campaigns can target LAT-on users, but advertisers will get this data at the ad group level rather than the keyword level.
Benefits of Limit Ad Tracking (LAT)
Even with the limitations that LAT poses, Apple search ads enable app marketers to reach their target audience on a global scale. Apple search ads are a very effective channel of advertising with very high user intent, and so the ongoing ad-blocking evolution still has advantages for mobile marketers.
- Limit Ad Tracking leads to a higher conversion rate. In fact, there is a 50% average conversion rate for search ads.
- Limit Ad Tracking improves cost per taps and cost per download.
Challenges/Drawbacks of Limit Ad Tracking (LAT)
Although there are many advantages to LAT, there are some obvious downsides. Without IDFA, behavioral targeting becomes impossible, leaving advertisers to depend on contextual targeting criteria. As a result of IDFA opt-in rates ranging from 4–13%, many organizations are seeking solutions that can provide accurate analytics, reporting, and attribution.
Worldwide Daily Opt-in Rates
For mobile marketers, tracking for LAT-on users is extremely limiting because a user’s data is off-limits unless they provide consent via App Tracking Transparency (ATT). Apple Search Ads ad groups with specific targeting (either age or gender-based) will be unable to reach users who have enabled LAT. Without a way to track LAT-on users, mobile marketers risk missing a quarter of the potential traffic.
As a result, by only being able to obtain install data from LAT-off users, mobile marketers suffer from data discrepancies that lead to an incomplete picture with a lower number of attributed conversions. Furthermore, turning on LAT can negatively affect the functionality of certain apps by disrupting advertisers’ ability to track revenue and other post-install metrics.
How advertisers can adapt
Possibly the biggest step advertisers can take to adapt as privacy preservation becomes more prevalent is to transition advertising measurement away from deterministic, user-centric models and instead use a holistic model that incorporates variations in ad spend and revenue to attribute efficiency to channel-specific ad campaigns.
Essentially, privacy preservation and ATT aren’t going anywhere. Workarounds are possible, however they are temporary. Eliminating the need to use extremely targeted ads simplifies the process of reaching target customers.
How MarinOne can help
MarinOne can help your organization optimize your app campaigns to improve performance and gain efficiencies. Through MarinOne, you can drive mobile revenue as well as app installations by leveraging Apple Search Ads and Google Universal App campaigns. Learn how MarinOne’s Apple Search Ads integration supercharges already powerful Apple Search Ads campaigns.
If you’d like to learn more about how you can use cutting-edge software to reach your customers more effectively, contact us. We’ll be happy to schedule a no-strings-attached demo of our solution for you today.