Introduced in iOS 14.5, the App Tracking Transparency (ATT) feature gives users control over their data by opting-in app tracking across third-party apps and websites. For apps and digital businesses that tracked users’ activity to show targeted ads, ATT is leading to a loss in revenue.
In a new report, The Financial Times states that many small businesses have felt the impact of ATT in recent months. Companies that rely on online ads to gain new customers have faced a 13% decline in revenue in Q2, 2022 because of changes related to the App Tracking Transparency feature on iOS.
Small businesses report the impact of App Tracking Transparency on iOS is more “brutal” this year than in 2021
According to the report, a data-sharing firm, Varos analyzed data from 1300 small businesses which revealed that the cost of gaining new customers through online advertising has become “significantly higher” in 2022 than it was in 2021, and the loss in revenue each month of Q2, 2022 resulted in a 13% dip in June because of ATT changes.
“I personally did not feel the impact of the Apple changes in 2021 as much as we are in 2022. This year is just brutal,” said Nadia Martinez, founder of Kallie, a handcrafted shoes company in California that she launched out of her laundry room in 2014. “Ads have become more expensive, we have less access to data, and they aren’t as effective as they used to be,” she said.
While Apple claims that customers’ feedback on App Tracking Transparency has been “overwhelmingly positive”, several apps and digital advertisers have reported financial losses because of it.
Previously, FT reported that Meta (former Facebook), Snapchat Inc, YouTube, and Twitter lost $10 billion in ad revenue, combines, in the second half of 2021. In July this year, Meta reported a $30 billion revenue loss, its first-ever quarterly dip in revenue.
For now, Apple has not expressed any intention to roll back the App Tracking Transparency feature or create a workaround. And it is probably best for companies to adopt Google’s and Twitter’s ad search data collection systems which are flourishing under the iOS ATT feature.