The IOS 14.5 update from Apple and what it means for e-commerce businesses

Apple just made it more difficult for companies to track users online.

This has made it more difficult for businesses to track users online and deliver ads to them. It also means that trust-building for companies, especially e-commerce, with its users is more important than ever.

What is the Update?

The feud between Apple and Facebook intensified as Apple released the IOS 14.5 update on the 26th of April 2021. So, what does this mean? In plain terms, it means that 728 million iPhone users will now require users to give explicit permission for Apple and websites to collect and share data. Users have an Identifier for Advertisers (IDFA) that they can now choose to share with companies or not share.

Apps that don’t take up Apple’s Tracking Transparency Prompt (ATT) will be banned and blocked from the AppStore and this move will mean that US users sharing information with apps dropped from 70% to 5%, and only 13% of users globally shared their IDFA.

What does it mean for e-commerce businesses?

The first and obvious effect will be on online advertising for e-commerce companies. Let’s take Facebook ads for example. Now that Facebook might not be able to track all users’ activities outside of Facebook, its targeting options have become much less effective.

If a user has visited your online store or marketplace and doesn’t choose to opt into sharing their IDFA with you – you’re not able to target them across social media. Online Ad campaigns are having to adapt quickly and drastically to deal with these changes.

Especially for E-commerce with an ios app, there will have been a high chance that your CPC and conversion rates will have dropped or fluctuated over the past couple of weeks due to these changes.

What can e-commerce companies do to make the most of it?

Moving forward, DigitalGenius believes building strong, trusting relationships with customers is the best bet and a major part of this is the customer service you provide. By focusing on customer service you can gain users who would be more likely to share their IDFA with you, hence increasing your ad conversion in the future. Not only this but more trusting customers are much more likely to repeat-purchase, and spread your brand by word of mouth leading to more sales in the future.

Conclusion

Whilst the end-users will be celebrating Apple and Facebook fighting it off it’s the businesses, particularly e-commerce, who will be most affected.

Putting money and time into ad revenue is less effective than 3 months ago, instead, look to spend more on customer service to improve your relationships with customers. This will have a knock-on effect on making your future ads more effective but also comes with all the benefits associated with impeccable customer service.