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Facebook Wants Users To Love Personalized Adverts As The Privacy Battle Against Apple Rages On

Facebook Wants Users To Love Personalized Adverts As The Privacy Battle Against Apple Rages On

Data seems to indicate that even during the tough times of the coronavirus pandemic, not many small and medium businesses pushed targeted adverts. This may indicate that may not be as big a revenue loss for SMBs as Facebook wants us to believe, ahead of Apple’s new privacy measures for the iPhone.

Facebook has made its reservations about the new incoming data privacy measures for Apple iPhones, known quite vocally. With iOS 14.5 for the iPhones, Apple will be implementing a new privacy tool that will generate a pop-up which will ask users whether they want the Facebook app on their iPhones to track their usage activities across other apps and websites. Users will have the option of not giving that access. Over the past couple of months, Facebook has been making their feeling well known to anyone and everyone willing to listen. That includes full page adverts in the US newspapers, a website where Facebook has been seen trying to champion the cause of the small businesses and social media posts by the company’s top executives. But it turns out that Facebook may be exaggerating and not being entirely generous with facts when it comes to arguing their case against Apple shutting down their data tracking pipeline.

Facebook is now also rolling out new permission popups for Facebook and Instagram users in the US, highlighting the benefits of letting the social media company track their usage across other apps and websites as well. But before we get into the selective portrayal of numbers, we must understand the very core of the argument. Facebook’s primary pitch is that by turning away the ability to track users, small businesses who rely on sending out personalized advertising will no longer be able to do so. And it’ll hurt them badly. “Apple's new iOS 14 policy requires apps to show a discouraging prompt that will prohibit collecting and sharing information that's essential for personalized advertising, unless users opt in on Apple's terms. Advertisers may not be able to effectively count conversions for iOS users who’ve opted out, harming advertisers’ ability to understand the value that ads are driving for their business,” is how Facebook is explaining the new iOS 14.5 security measure.

And how does it impact small businesses? “Our studies show that when running ads on the Facebook family of apps to drive sales on their websites, small businesses saw a cut of over 60% of their sales, on average, for every dollar they spent when they weren't able to use their own data to find customers on Facebook,” this is what Facebook says. And this is exactly the number that is being put into perspective by research firm Deloitte in the Digital Tools in Crisis and Recovery: Small and Medium Business Report from October. Simply put, Facebooks says that small businesses would suffer a 60% cut in revenues if they are not able to do personalized advertising.

The number, for sure, seems quite high. And in the larger scheme of things, quite worrying. But on their website which makes this claim, Facebook doesn’t exactly say how it has reached this figure, which we assume would be based on two comparative studies. All the social network says in the explanation is “we compared the aggregated results of advertising campaigns that used the advertisers’ own data to optimize for purchases on the advertisers’ websites compared to the results of only using the ad platform’s data. The research analysis includes over 25,000 global advertising campaigns where advertisers were optimizing for purchases run in 2019.”

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The Deloitte study suggests that just 34% small and medium businesses increased targeted or personalized advertising since the coronavirus pandemic outbreak, with the largest share of that targeted advertising on social media being taken by Telecom and Technology businesses. Among the small and medium businesses around the world, of the percentage of SMBs surveyed for the report, the maximum focus was on India where 62% of such businesses focused on targeted adverts or paid marketing activities on social media. The survey included more than 4,300 SMBs across 17 countries.

What exactly is Apple doing to get Facebook all riled up? The thing is, Apple will be rolling out the already deferred (to give app developers more time) App Tracking Transparency feature that will give users more control over who tracks their data and give them the option of stopping these apps from tracking them. This will be available on iOS 14.5 on the iPhone and iPadOS 14.5 for the iPad. For instance, when you open an app on your iPhone, for the first time or after an update, you will be asked, “Allow XYZ to track your activity across other companies’ apps and websites?” The two options you will have at this stage would be “Ask App not to Track” or “Allow”. The App Tracking Transparency feature will be part of the Privacy menu in the Settings app. This is another addition to the privacy dialup that Apple has implemented with iOS 14.

Just a few days ago, Facebook started rolling out popups on the iPhone and iPad apps, albeit for users in the US just yet, trying to play up the benefits of allowing them to track user data and the benefits that personalized adverts offer. Yet again, the perceived plight of small businesses is being played up. Two larger points basically. First, get ads that are more personalised. And secondly, support businesses that rely on ads to reach customers. It is expected that these popups will be rolled out for more users globally, as we get closer to the Apple iOS 14.5 release.

Earlier, Facebook’s efforts to be seen championing the cause of the small businesses was criticized by a not-for-profit digital rights group Electronic Frontier Foundation, or EFF. “Requiring trackers to request your consent before stalking you across the Internet should be an obvious baseline, and we applaud Apple for this change. But Facebook, having built a massive empire around the concept of tracking everything you do by letting applications sell and share your data across a shady set of third-party companies, would like users and policymakers to believe otherwise,” they had said.

An iPhone user will now be able to choose whether they want to allow or deny an app from tracking their browsing and app usage trends. The iOS 14.5 update is expected in the coming weeks, though we do not know exactly when.