Apple Takes Bites at Ad Dollars

Apple has been making a slow, but not so subtle move into the ad industry over the past year. When Apple released iOS 14.5 in April 2021, their App Tracking Transparency (ATT) feature rattled the industry as iPhone users began opting out of tracking across other apps and websites.

What Apple deems a privacy-centered move is being scrutinized as a way to build an ever-tightening grip on the ad industry. Since then, Apple has bolstered its Search Ad product and recently opened up more ad inventory within the app store. Following in Netflix’s footsteps, the company also appears to be in the planning stages to roll out ads on its Apple TV+ product. And in their most ambitious move yet, the tech giant is also in the early stages of building its own DSP. Adding more fuel to these flames, iPhones just eclipsed Android in US smartphone market share.

But this week, the company took a new and rather surprising move to get a bigger piece of advertiser’s dollars. In the release notes for iOS 16.1, Apple says the following:

Added 3.1.3(g): “Advertising Management Apps: Apps for the sole purpose of allowing advertisers (persons or companies that advertise a product, service, or event) to purchase and manage advertising campaigns across media types (television, outdoor, websites, apps, etc.) do not need to use in-app purchase. These apps are intended for campaign management purposes and do not display the advertisements themselves. Digital purchases for content that is experienced or consumed in an app, including buying advertisements to display in the same app (such as sales of “boosts” for posts in a social media app) must use in-app purchase.”

Let’s  Brk_down what this means. If you boost posts (for example, paying to boost a post in Facebook) within the same app on which the ads will display, Apple is saying you must make an in-app purchase, and they will take a 30% cut.

This will impact small business owners who boost posts from their Facebook page to increase reach. Nearly one-third of your purchase will go in Apple’s pocket, with the remainder allocated to actually boosting the ad.

How can you avoid this? Use your Ads Manager or contact a trusted partner like Brkthru!

Clearly the latest move from Apple is not the last. The company has a treasure chest of data that it hasn’t monetized, and while they, like Netflix, have been hesitant to use it previously, economic conditions may force them to change their philosophy.

At Brkthru, we’re on it 24/7. We have a dedicated team keeping a pulse on everything from the mundane to the messy. If you have questions about how to navigate these changes, reach out –– we’re all ears.