In this bite-sized episode, the spotlight is on iOS 14 and its potential implications on digital marketing. Ad Pros Nehal Kazim joins host Joe Troyer to bring us up to speed on the iOS update and gives his expert opinion on what it all means for the digital marketing industry.
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Joe Troyer 0:39
Obviously, iOS 14 as a rural, talking about this are recording this is going live. It's out. We're talking about major potential implications with advertising. For anybody that hasn't been following the news, can you just talk about what are the potential implications? And then let's talk about kind of your standpoint on the issue because like we were talking about before we started, people are either like acting like this isn't happening, they're downplaying it, or it's like the end of the world as we know it. Or just, you know, people are just burying their head in the sand, you know, and not saying anything. So, yeah, bring us up to speed on what's happening first, and then I'd love to hear your opinion. Yeah. So
at the point where we're recording this, there's like, there's two parts to this one is the adjustment that Facebook has made preemptively for the actual iOS 14 change. So there's a lot of different things going on. There's a lot of like acronyms and a lot of technical implementation that's going on, and Facebook doesn't know a lot of this, what's actually being implemented or what the implications are, neither do their ad reps. Like, then therefore, if they don't know, like, the, the, this downstream of that isn't very good, or very high quality, in terms, so I won't go too much on the technical side, because I don't know, like, no one really knows there's a degree of it, but I do understand some of the implications. So from an advertising side, what's going to happen is people have from, from an iOS standpoint, they have the ability to opt in into sharing their information or opt out. And so again, the first, you know, the guess is that 80% or more might opt out. So Facebook's way of doing this, or hopefully preventing or decreasing that percentage is creating their own prompts, and educating people on it, so they don't opt out. But most likely, most people will. Once if someone opts out, which we're assuming that most people do, what's going to happen is you're going to lose, or we're all going to lose a lot of the actual tracking and pixel information. So for example, if you have a funnel, you know, you're running Facebook ads, right now to an e commerce store, there's a click, then someone views a product page, and someone adds to cart and someone's initiate Checkout, and then they buy, those are like the normal like traditional steps. with iOS 14, you can just see the click and use just see the purchase, all the other steps are lost in between. And so when it comes to optimization, when it comes to retargeting, when part of that is there's not a lot of the demographic data is going to be gone. So if it's a man or a woman, or a 55 year old or 25 year old, from what I've understood, like that information is going to be gone. What else? That's like a big part of it. So I think like, the important it, you know, element is, how will that change, account structure, optimization, attribution, you know, how we're doing conversion, because what what's the underlying element here is that pixel data is going to get severely, you know, is going to decrease significantly, because the core thing that's happening is, inside of Facebook, we have the way that Facebook does attribution is one day view and 28 day click. So basically, if someone views an ad and buys, they will get attributed to that specific ad. And or if they click that ad, don't, you know, go to another Facebook ad or anything like that, and come back and buy it within 28 days. So they bite on the 27th day, I will go back to that specific day on January 1, even if you bought on January 27. And so that's really interesting, because now that 28 day period is going to go down to seven days. And so if you have a more expensive product, so we have a client that selling furniture on Facebook, and so their average order value is $650. They're delayed attribution, meaning from the time we spent $1. The same day we make like $3, but within 28 days, we were making an another dollar 50. So like 150% delayed attribution. Now that's going to get cut down the amount of visibility we have on demographic data, conversion data, attribution data, and then how we actually make any of those decisions is going to change. So there's a lot going on right now, based off of this recording the the change inside of Facebook just to roll out their internal changes have started. So they've already decreased it to seven days. So one of our clients with that Furniture Company, our normal roll as is 300%, end of day, it went down to 30%. Overnight on Facebook, right on the back end, though, things are working. And so the day after that it was 170%. But we're used to 300 plus the delayed attribution of 150. So we're, our expectations are going to change how Facebook is going to implement all of this is going to change. And this is also before the actual iOS update has happened. So this is this is what I've understood so far. And we can talk about kind of the strategic side of this.
Joe Troyer 5:47
And that's so crazy, just just the attribution window, I didn't really think about I thought about the the pixel data a lot, but I didn't think about the attribution side. And that's so huge. One of my business partners, he, they run a high ticket funnel on Facebook. And if you look at that attribution window, if you're looking at like seven days, their cost per sale, they sell a $8,000 program, their cost per sale is like four grand, right? If you look at that attribution window on like, you know, day 28, their cost per sales like 1500, right? Like they could never run that funnel profitably looking at that attribution window in seven days, like it just,
you know, no, not really, that really bad feedback loops. And in terms of the optimization of the right person, that's a huge problem. There are like the conversions API. So people will hear about Kathy, and there's implementation on that. But it's not clear that even if you have that data, and you put it into Facebook, will it actually attribute back? And will Facebook take ownership of that? Will they block it? Or will they say, look, if you can update information however you want, it's up to you guys. It's your data. And then that's where kind of things get a lot more great. And so I think with all that said, there's a lot more implications to this, there, we're trying to figure out all the things that are potentially going to break or potentially going to have breakthroughs. But the reality is that at the end of the day, there's a lot of people that including right now, a completely checked out, not looking at this not considering like options, and for us, and this is this is really important. When this kind of stuff happens. We are super grateful for it, and we attack. So we're in offensive mode, same thing, like, you know, transparently 40% 50% of our clients, we had emergency internal meetings last week, so in the first second week of January, just to figure out performance stuff preemptively before it goes even worse, right? Because other people aren't doing that, here's assuming that things are gonna break, and they are, but how do we react? And so what we want to do is same thing happened pre COVID. We felt it, you know, and then COVID really happened, then we really felt it just like everyone else. But we were able to come out on the other side a lot more aggressively and profitably for our clients. Because we're trying, we're trying to figure out, no one knows. But if you're not attacking it, then like, this is a very performance based environment. And people who aren't aggressive proactive in problem solving mode, aren't in victim mindset. Like those are the people who are going to win, everyone else is going to kind of get leftovers. And we just saw that with COVID. Very clearly.
Joe Troyer 8:36
Yeah, for sure. I think like during COVID, a man like the leadership of some people, like just took off, and others just yet completely buried their head in the sand and businesses were ruined from it. But the people that really, you know, went on the offense and figured out solutions and really reacted, I think without question like all of them ended up doing really, really well. You look at like everybody that jumped in with PPP. And we're talking about how to get it and Ei dl and all of that major, major, like leadership roles in the industry and their businesses were forever changed, whether they were accountants or CPAs, or just business people, it doesn't matter, but their influence, just like spread like wildfire. Yeah. So I think that there's a huge opportunity to do the same with us. And
there's a massive degree of luck. There. That's definitely part of this process. And so I'll take all of it. But like, the harder I work, the luckier I get, like, that's my approach. And there's the also the mental health side of this, which is how do you actually manage you? And how do you manage your emotions? Because I'm preparing myself and my team like, Look, what happens if we lose 30 to 50% of our revenue, like you guys will have jobs but like, you need to understand kind of where I'm coming from, and the way that I need to address this because this is serious, potentially. So could it be that we don't know, but I'm ready. For that, you know, hopefully we're able to overcome that in a quarter if it if it hits as bad as I think it can, but hopefully it doesn't. So far so good. And we want to be we want to be ready.
Joe Troyer 10:14
Yeah, man, something to definitely keep an eye on.