What is App Tracking Transparency? How Does it Work? -

What is App Tracking Transparency? How Does it Work?

9 MIN. READ

The concept of privacy has taken center stage in an era dominated by digital connectivity, causing major changes in the way apps handle user data. Enter App Tracking Transparency (ATT), a groundbreaking development that has reshaped the digital landscape. This blog post explores ATT’s facets, origins, impact on consumers and apps and the evolving privacy norms it represents.

For a deeper understanding of ATT, we must look at the roots of privacy measures in the digital era. Each step has paved the way for ATT, from early attempts at user data protection to the landmark General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA). 

General Data Protection Regulation (GDPR):

A major milestone was reached in the evolution of privacy regulations in Europe when the GDPR was implemented in 2018. Besides providing comprehensive rules for the European Union, GDPR had extraterritorial implications, impacting any organization that processed data of EU residents. Focusing on principles like data minimization, purpose limitation and the right to be forgotten sets a high standard for global privacy protection.

California Consumer Privacy Act (CCPA):

In 2020, California enacted the California Consumer Privacy Act (CCPA), which was a groundbreaking piece of privacy legislation in the United States. A key feature of the CCPA is that it gives California residents enhanced rights regarding their data, such as the right to know what personal information a business collects about them and the ability to opt out of the sale of their data. This move signaled a growing awareness and acknowledgment of the need for enhanced privacy protections, even at the state level.

The Impact of ATT on Consumers and Businesses

ATT isn’t just a regulation; it’s a game-changer for both consumers and businesses. We’ll explore how users gain more control over their data, making informed choices about app permissions. Simultaneously, businesses face a paradigm shift in their advertising strategies, prompting them to reevaluate their approaches to data collection, personalization and user targeting.


Understanding the ATT Framework

What’s ATT?

Apple introduced App Tracking Transparency (ATT) as a privacy feature that gives users more control over their personal data within mobile apps. As part of iOS 14.5 and later versions, ATT requires app developers to request explicit permission from users before tracking their activity across other apps and websites. By granting or denying permission to apps to access their Identifier for Advertisers (IDFA), this transparency initiative aims to enhance user privacy. 

As a result of ATT’s consent requirement, it introduces a new level of transparency into the digital ecosystem, shifting the balance towards users’ empowerment and fostering a more privacy-conscious approach to app tracking and targeted advertising.

Key Features and Components of ATT

The App Tracking Transparency (ATT) framework consists of several key components that enhance user privacy. An important new feature is the addition of privacy nutrition labels to the App Store. Users can check these labels to learn more about an app’s data collection practices, including the type of data collected and whether it is connected to the user’s identity. Transparency allows users to make informed decisions about apps that align with privacy preferences.

Another crucial component of ATT is the requirement for explicit consent from the user. To ensure that users have a say in how their information is utilized, apps must now obtain explicit permission from users before tracking their data across apps and websites.

How ATT Changes the App Permission Model

By placing consent at the forefront of the user experience, ATT represents a paradigm shift in app permissions. In the past, apps had access to certain data by default, which could be limited by the user after installation. 

The ATT model, however, requires apps to explicitly request permission to track before users engage with the app. The data-sharing process is now more transparent and proactive for users. Consent is clearly requested and privacy settings can be managed and adjusted easily. By empowering users, these changes aim to make them active participants in their data usage decisions.

Requirements for Developers under ATT Regulations

The role of developers in ensuring ATT compliance is crucial. They must follow specific guidelines to prioritize user privacy under ATT regulations. They must implement the App Tracking Transparency framework into their apps, provide clear and concise explanations in tracking permission dialog boxes and respect user choices regarding data tracking. Developers must also update their apps’ privacy policies to reflect how they collect and use data accurately.

 

Impact of ATT on App Developers and Advertisers

Changes in Data Collection and Usage

ATT introduces a fundamental shift in how app developers and advertisers collect and use data. It has been common practice for apps to gather user data implicitly, without explicit consent, by quietly tracking user behavior. ATT disrupts this norm by requiring developers to obtain explicit user consent before tracking their activities across apps and websites. As a result, there are profound implications for the types and amounts of data available. Now, developers must work within the constraints of user-approved data access, limiting the amount and type of data collected.

Shifts in Advertising Strategies and Budgeting

ATT’s limitations on tracking users force advertisers to adjust their advertising strategies and budgets accordingly. Due to limited tracking capabilities, targeting specific user segments becomes more complicated. As a result, advertisers are forced to explore alternative advertising strategies, such as contextual targeting, which tailors ads based on the context of a user rather than their past behavior. These shifts in advertising methodologies require budgeting reassessment. For advertisers to remain competitive, they need to reallocate resources in a way that prioritizes user privacy while maintaining campaign effectiveness.

New Challenges for Personalization and Targeting

The ATT era presents novel challenges for personalization, a cornerstone of digital marketing. With user tracking becoming more limited, delivering personalized content demands innovative solutions. The challenge marketers face is achieving personalized user experiences without using invasive tracking techniques. The challenges include understanding user preferences, anticipating user behavior and tailoring content accordingly. New strategies include leveraging first-party data, leveraging user information and deploying advanced machine-learning algorithms to predict consumer behavior. In an environment where privacy takes precedence, marketers must balance delivering tailored experiences and respecting user privacy, fostering trust and engagement.

How do users feel about ATT?

According to Statista, the monthly opt-in rate of mobile users worldwide, allowing app tracking after the iOS 14.5 update as of April 2022, is 25%, which was only 11% in April 2021. Even though there’s an increase, a huge majority still choose not to opt-in for tracking. 

What should advertisers/developers do?

So advertisers need to analyze user engagement post-ATT implementation. Studying user interactions within the app, such as time spent on the platform, frequency of use and specific features accessed. Developers can use user engagement data to identify patterns and trends, enabling them to adjust their strategies for content delivery, user interface design and overall user experience. App developers can enhance user satisfaction by closely monitoring user engagement after ATT and making informed decisions based on that information.

ATT’s Significant Impact on Mobile Gaming 

Real-world examples provide valuable lessons. Let’s look at how ATT made groundbreaking changes to mobile gaming as told in our latest e-book, ‘’The Rise of Hybrid-Casual Games’’:

‘’Due to ATT, measuring and generating non-organic installs have become more difficult and user acquisition costs have increased in the mobile game market. With costs rising, mobile game owners have been struggling to compensate for their return on investment (ROI). 

This means they needed to find a new way to keep players in the game for long periods so that they could increase their ad revenue and balance the costs emerging from user acquisition. In light of these, the solution was to adapt the product to existing conditions, adding meta layers to games and giving birth to hybrid-casual games.’’

The impact of ATT on the mobile gaming industry has been transformative, prompting significant shifts in user acquisition and monetization strategies. ATT privacy measures have led to increased challenges in measuring and generating non-organic installs, resulting in elevated user acquisition costs. Adapting to the evolving landscape has resulted in hybrid-casual games ushering in a new era of gaming. These games, enriched with meta layers, not only adhere to ATT’s constraints but also offer a sustainable model for prolonged user engagement. Mobile gaming has exhibited resilience and adaptability in the wake of ATT, showing how challenges can spur innovation and shape a sector.

 

Adapting to the ATT Era

Strategies for App Monetization in a Post-ATT World:

Developers are challenged to explore innovative monetization approaches that align with heightened user privacy. The reliance on traditional advertising methods driven by extensive user tracking is diminishing in the post-ATT landscape.Due to this, developers are increasingly embracing alternative monetization strategies.

  • Users can subscribe to premium content or features for a recurring fee, providing a direct revenue stream while respecting their privacy.
  • In-app purchases become pivotal, allowing users to buy virtual goods or additional functionalities within the app. 
  • Hybrid monetization combines multiple revenue streams and is also a popular monetization strategy.

Innovations in Attribution and Analytics Without Invasive Tracking:

Under ATT, invasive tracking is restricted, forcing a paradigm shift in attribution and analytics. Businesses and developers are exploring new technologies and methodologies to gain valuable insights into user behavior without resorting to invasive tracking techniques. Several approaches are being adopted, including advanced attribution models, anonymized data aggregation and privacy-preserving analytics. With these innovative solutions, businesses can enhance user experience, target audiences efficiently and make informed strategic decisions while maintaining users’ privacy.

 

Future of App Tracking and User Privacy

Machine learning will continue to rise

A marketing campaign’s performance is traditionally evaluated using data pipelines that rely heavily on device identifiers to measure user monetization over time. Due to losing device IDs, marketers must redesign those data pipelines to measure return on ad spend (ROAS).

Instead of relying on measured or observed metrics, new marketing strategies will rely on machine learning and predictive metrics. To do this, marketers will need to develop new technological capabilities.

For example, machine learning can predict how users will monetize at 30 days or 60 days, LTV and churn using a campaign’s first four days of event data. Even though many publishers may not have considered AI and machine learning to be necessary because they could measure metrics directly, they are now relying heavily on AI and machine learning.

Retention is even more crucial than before

It has traditionally been the norm for app marketers not to worry about churn since retargeting can bring back their most valuable users, extending their lifetime value. Privacy constraints make it challenging to regain a churning user in today’s world.

In today’s business environment, churn prevention must be a key component of your strategy before you lose a customer permanently.

This is where predictive analytics comes into play. The marketer can target the users who are most likely to churn to capture their attention and persuade them to stay. Additionally, they can observe related user behavior, such as the actions that led to them leaving or the most effective marketing strategies to keep them.

How to best adapt?

In anticipation of Android privacy changes, there are a few things developers can do today to minimize challenges in the future.

In order to begin preparing for these upcoming changes, developers should consult ad tech providers and other marketing providers to find out how they plan to handle them from a technical perspective.

Many of the concepts that Android is developing in the Privacy Sandbox also apply to the new iOS SKAd Network reporting structure. These frameworks will help you optimize your app’s conversion tracking. Last but not least, ensure you secure bandwidth from internal product teams and tech teams to conduct privacy sandbox integration tests and test the latest features of the SKAd Network by the end of the year.


Final Thoughts

The App Tracking Transparency (ATT) initiative represents an important milestone in the digital era, reshaping user privacy and app functionality. ATT emerged not merely as a regulation but as a catalyst for change as we examined its origins, impact and evolving norms. The consumer gains unprecedented control over their data, while the advertising industry has to adapt its strategies to the new structure. The developers are responsible for ensuring compliance and the post-ATT landscape sees innovative ways to monetize, attribute and analyze apps. We can predict a dynamic yet promising future by examining evolving privacy norms, upcoming technologies and transparency. To navigate the post-ATT era with resilience and ethical foresight, brands must embrace principles of transparency and user empowerment.


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