How build a future-proof ad business (hint: copy Apple)
The cookie is the lead actor in the longest death scene in the history of advertising. With that big change on the horizon – as well as many others – brands need to mimic Apple in order to survive, writes Salesforce strategy executive Martin Kihn.
How has Apple gained the trust of consumers?
Advertisers only wish we knew as much as people seem to think we do. “Surveillance” is a mysterious term and surely overstates the case. But it is undeniable that the rules are changing, perception is a mounting problem and it’s time to think ahead. How?
Apple leads the field with its provident tactics. Already a significant – if not yet dominant – media player, it is assembling the components of a powerful offering and has much to teach us all.
1. Start with your brand
This won’t be easy. The ad business has long had trust issues, which did not start with GDPR and CPRA. Celebrations last year that advertising was now merely the second least-trusted profession (after politics) were just sad.
Publishers know that trust in media is down. On the demand side, faith in companies and institutions is in breathtaking global decline.
But there is an exception: a $400bn-earning company that has managed to persuade most of us that it’s not part of a menacing “data-industrial complex.” Apple is the world’s most valuable brand, according to Interbrand – up 26% since 2020, well ahead of its competitors.
How? It raised awareness for problems most did not know existed – such as mobile app ID, IP address and email “tracking” by marketers – and then provided a solution. In a single release (IoS 14.5 for AppTrackingTransparency [ATT]), Apple went from enabling to solving a problem. Its brand as a neighborhood watch for the web extended to TV spots showing creepy characters stalking us on our phones – until a superheroic ATT intervened.
Lesson: Counteract trust erosion by investing in a brand of law and order.
2. Make the opt-in positive
Apple has championed the opt-in model of consent, arguably influencing pending national privacy legislation. Opt-in presents the consumer with a mandatory choice to accept or reject (opt-in or -out) whatever is requested.
The challenge here is well-studied, although not by advertisers. It even has a name: “The Paradox of Privacy.” As it turns out, there are a lot of cognitive biases that affect a person’s decision in that magic opt-in moment.
We are lazy (“can’t think about this right now”); overestimate how much data is collected about us (“tracking me around the web”); underestimate the benefits (“what is ‘relevance,’ anyway?”) – in short, quite logically, we lack both the time and data to make a good decision.
Very few people watch ads by choice, and nobody endorses tracking. The most successful modern platforms – paid search, social in-stream, retail media – are not optional. Opting-in to ads is a default on sign-up.
A meta-study of dozens of academic studies of the privacy paradox concluded: “Privacy attitude was best predicted by internal variables like trust...”
And that’s why the language on the opt-in box itself – the experience around the decision window – is critical. Apple knows this.
As we all know by now, the required headline for the required ATT prompt read: “[‘Brand’] would like permission to track you across apps and websites owned by other companies.”
We note that tracking is not a benefit, and no rational actor would agree to it, even with time to think.
When it came to describing the rewards of targeting in its own environment, Apple provided more benefit-centric headline text and copy: “Personalized Ads ... help you discover apps, products and services that are relevant to you.”
Lesson: Frame the benefits of behavioral data collection in positive terms.
3. Focus down the funnel
The cookie and mobile IDs may be engaged in one of the longest death scenes in history. But pointed targeting and powerful measurement are more possible than ever – in controlled (“opted-in”) environments, sometimes called gardens.
Digital ad money was always further down the funnel than linear, and it’s getting more so. People forget that paid search is still half of digital ad dollars, and it’s a strong signal of intent. Retail media is more than a trend: connecting ads with purchases is as outcome-based as ads can get.
Building up a campaign, smart marketers start with (1) moments closer to the point of sale, and (2) outcomes they can track. They build out from there, into intent and targeted awareness (such as CTV) and then less controlled environments such as late-night cable for reach.
Apple’s media business starts with Apple Search Ads for app installs in the iTunes store, an estimated $5bn business. Exempt from ATT, Apple can tie these ads to app installs and in-app activity. (Compare this with the brand-focused, abandoned iAds project.)
What comes next? It added hero placements on the App Store’s opening screen. It also offers ads in its News, Podcasts and Maps apps. Maps in particular offers direct-response opportunities tied to location.
That long-rumored DSP and network could allow Apple to bring some of this helpful intent information to ad targeting in apps it doesn’t own.
Lesson: Future-proof ad businesses start with direct response ads.
4. Focus on ‘non-ad’ and peripheral placements
There are ads that are ads that don’t seem much like ads. They’re more likely to be acceptable even to more paranoid web surfers and the regulators. Paid search is an example, I think: despite Google ingesting some of the most private material on earth, consumers don’t seem to think it’s a problem.
Contrast search with a retargeted banner, which appears out of nowhere indicating it was watching me elsewhere. The retargeter knows much less about me than my search engine, but seems to know more. Why? It’s overestimated. And it was widely noted that Apple Search Ads flourished after ATT limited retargeting last year.
What does this mean for your future-proofing ad player? What I’m calling “non-ad” ad formats are those that are ads but don’t feel like them. Look at product placement. These ads are growing almost as fast as connected TV (CTV), are a $23bn business and are not even mentioned in the 11 chapters of the GDPR text – which mentions just about everything else.
As artificial intelligence (AI) gets better, weaving products into shows on Apple TV and network apps becomes appealing. Other trending formats don’t interrupt but marginalize ads, literally placing them around content. TikTok Pulse and Meta’s Reels released new “multi-advertiser” formats like this.
The real opportunity may be in shoppable commerce. These are non-ads in that they put a buy-now button on other content, such as a show (or product placement). As mobile ad expert Eric Seufert has noted, commerce, retail and CPG are Meta’s largest verticals. Innovative units could shift some of that spending around.
Lesson: Future ads look more like buy-now buttons.
Martin Kihn is senior vice-president strategy, Salesforce Marketing Cloud.