• by Laurie Sullivan  @lauriesullivan, December 14, 2021

Mobile attribution and measurement took the brunt of the disruption when Apple began enforcing its App Tracking Transparency (ATT) framework on April 26, 2021, in iOS14.5, requiring apps to actively gain user consent for tracking via an opt-in mechanism.

The move, while welcomed by many marketers to protect consumers, ushered in a new privacy era. ATT created a massive challenge for mobile app marketers. Suddenly, data was limited, turning user-level measurement and optimization upside down.

How did ATT impact the number of downloads driven by marketing, including budget allocations? What has been the effect on consumer spend in apps? 

AppsFlyer addresses these questions in its annual top five data trends report. The data analyzes more than 60 billion app installs in 2021, allowing the company to forecast what 2022 will bring as the industry continues to adapt to the new privacy paradigm.

A year-over-year comparison has 2021 app installs surpassing 2020 by 19%.

“This is quite a feat considering 2020 with its lockdowns and social-distancing policies that generated a 33% leap, compared to 2019,” according to the study.

The ATT prompt changed an industry and created a dilemma for mobile apps, according to AppsFlyer. Some apps chose not to implement ATT, concerned the prompt, with its somewhat “off-putting language,” can drive churn and disruption to the user experience. In this case, app marketers would settle for SKAdNetwork attribution and probabilistic modeling. 

The benefits of showing the prompt far outweigh the benefits of not showing it, according to AppsFlyer. The data shows that six months after the release of iOS14.5, nearly 65% of apps implemented ATT, with estimates this number will rise to 70%-75% next year.

AppsFlyer has seen ATT opt-in rates consistently reach 46% during the last few months. This means nearly one in every two instances when a user sees a prompt, the Allow button is tapped. It shows many users are willing to accept tracking in return for a more personalized experience. 

ID matching, however, can only work if there is dual consent on both the publisher and advertiser side, which means the Identifier for Advertisers (IDFA) attribution rates are much lower.     

AppsFlyer predicts opt-in rates will continue to improve as users deal with poor user experience from untargeted ads, while brands will get better at optimizing their prompts and providing a clear value exchange. 

A new report by Gartner predicts that opt-in rates will increase by over 150% by 2023.

As for conversion values, with time, knowledge, testing and training, marketers will fine tune their mapping and schemes to make the most of the data available to them. 

Changes this year in overall demand for apps varied significantly between the two platforms in overall installs this year in nearly every category, especially Dating, News, Shopping, Finance, Health & Fitness and Gaming.

Finance came in at the highest rate in iOS and second-highest on Android. Fintech apps helped people manage their personal finances, invest in stocks, manage digital wallets, payment methods, cryptos, leading a global revolution on the relationship between people and their money.

Social and Shopping also had impressive growth, while Gaming lagged because of losses on iOS.

Developing marketers drove growth. A global view shows 30% growth in the developing world across Latin America, Middle East, Africa, India and Southeast Asia.

Growth in the U.S. lagged compared with other markets, but still managed to drive increased demand for apps, about 10% YoY, while installs in India grew by 14%. 

It's important to note that user acquisition budgets in 2021 will end the year between $78 billion and $83 billion, driven primarily by budget estimates in China. The amount represents a 40% YoY increase driven by a 50% jump in Android and 26% rise in iOS. Spend increased on both platforms, but the reason behind the growth in each OS was entirely different. 

iOS saw fewer NOIs this year, declining 5%. iOS also experienced a significant rise in effective cost per install, which drove budgets upward. Ad prices increased by 20% to as much as 50% across nearly all categories since the enforcement of iOS 14.5.

Marketers were able to acquire and get credit for far fewer users for the same budget they’ve invested in 2020, or they had to increase their spend for the same amount of users.

Media prices rose on iOS, based on supply and demand. The prices for a much-lower supply of consented users leaped as demand for users with full data granularity skyrocketed. The main jump in cost, per AppsFlyer, has been the inefficiency of major media sources during a time of transition to target the right people and estimate the right impact. 

It’s difficult to make small segments of high-value users, so marketers need to use broader targeting, which also makes it less relevant. Networks can’t optimize in-app signals yet. This capability is being developed with solutions such as Google’s GBRAID and Facebook’s AEM; until they do, their targeting and optimization abilities are negatively affected.

Demand for Android with its full data granularity surged with NOIs, rising over 40% YoY, especially in Gaming where NOIs leaped 50% compared to non-gaming at a still impressive 36%.

Global, Android CPI in Gaming was down 11% this year, but increased 23% in North America, and dropped 24% and 15% in Southeast Asia and Japan and Korea, respectively, while non-gaming CPIs rose by nearly 20%.

Facebook lost its dominant position in iOS among consenting users to Apple Search Ads (ASA). ASA has its own API and is able to maintain full data granularity, attracting more budgets to this platform. 

User acquisition budgets will continue to rise with more NOIs on both platforms. However, the cost of media won’t increase as much in iOS this year, given the estimations that the inefficiencies on the network side will be largely solved.