Apple Changing the iPhone Tracks Users May Affect Data Collection | Loyalty360 Member Perspective

Apple has announced that it will start curtailing how users of its iPhones will have their personal data collected when its new operating system is upgraded to iOS 14. Even though Apple said the changes were being delayed until the start of 2021 to give app developers and websites more time to adapt their services, the change could mean an alteration in how retailers utilize their customer engagement activities.

A key privacy feature in the operating system will be a new option that allows users to disable tracking between different applications. Already, applications such as Facebook have warned that the changes to the Apple iOS could curtail the way it uses advertisements on its app, suggesting that revenues from its Audience Network business.

An Apple spokesperson told media outlets that the company welcomes targeted advertising, but it wants to give users the ability to opt into those types of ads. They say that if someone doesn’t want to be tracked, Apple will inform the app’s developer that it needs to make sure the app is complying with the new restrictions. Apple says it could ban any app that continues to track users against their wishes.

“The balance of power is shifting to the Consumer,” says Ryan LaMirand, CEO of PrizeLogic. “The days of grafting consumer information without consent or real value exchange for the consumer is quickly coming to an end. Brands will need to do more to directly engage their consumers via meaningful value exchanges.”

Stop Depending On Walled Gardens
Richard Jones, CMO for Cheetah Digital, says Apple’s changes to IDFA reinforces the need for marketers to stop depending on walled gardens and start owning their own data.

“Zero-party data — self-reported data — is becoming king, and it’s not as hard to build a database as one may think,” Jones says. “Consumers are more than willing to provide data to brands who ask and offer a value in exchange. Brands can easily collect this data through micro experiences such as photo contests and sweepstakes, in exchange for discounts, offers or personalized experiences.

In fact, Jones says this data is not only more reliable because it’s self-reported, but it’s also a far greater value than leveraging second and third parties to communicate to your consumers.

“You’re able to go beyond the typical '40-year-old male in Chicago’ data and dig into deeper, behavioral-based insights in order to drive a more emotional connection with your consumers,” he says. “If brands start now, they’ll find they can mitigate the risk of their program feeling the effects of these stricter privacy regulations, and can even grow their program through reallocating that budget to more effective sources.”

Requiring Apps To Ask For Permission
In addition, the new iOS 14 system will require the apps to ask for permission before tracking a user across other apps or websites that the iPhone user may be utilizing. This may create issues with apps used by brands that utilize customer or loyalty engagement programs to track websites the user is visiting, or which apps they are using.

LaMirand says digital engagement through promotions, rebates and offers, and loyalty will increasingly provide the value exchange to opt-in for self-identification and wiliness to be tracked across channel activities.

“It will get more difficult to find signals to complement your program’s first-party consumer data with the increasing number of data collection/use restrictions,” he says.

LaMirand’s advice to brands: plan to evolve your apps and transactional programs with overlays to develop emotional loyalty to produce more people-based handraisers while capturing a deeper and proprietary understanding of your customers.

The changes for iPhone users involves the collection of its advertising identifier for users, which are called IDFA, a tag that can help advertisers connect a click on an ad with an eventual app install on a device. Apps will be required to ask users whether they can be tracked, and if most users opt-out, it could deal a heavy blow to an industry already reeling from the COVID-19 pandemic.

Apple clarified that it wouldn’t prohibit tracking, but instead will put the responsibility on app makers to get permission in advance.

The change could force others in the telecommunications industry to also limit tracking. That may result in some ad-tech firms to write off the Apple identifier. Branch Metrics’ Alex Austin tells the Wall Street Journal that the firm is assuming IDFA is “dead for everything we’re doing.”

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