Shares of Facebook drop after company warned Apple’s privacy changes will have a bigger impact in Q3 – TechCrunch

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Facebook today provided an update on the impact of Apple’s privacy changes on its advertising business. The company had already warned investors during its second quarter earnings that it expected to feel an even more significant impact in its advertising targeting business by the third quarter. This morning he reiterated this point, but also noted that he had underestimated iOS web conversions by around 15%, which led advertisers to believe the impact was even worse than they expected.

According to Facebook’s announcement posted on its corporate blog, this exact percentage could vary widely between individual advertisers. But he said real-world conversions, including things like app sales and installs, are likely higher than what advertisers see when using Facebook analytics.

Shares of Facebook are down nearly 4% on this news, at the time of writing.

This isn’t the first time Facebook has been sharing misleading metrics. In the past, however, it had inflated its video ad metrics and did not act quickly to correct the problem, leading to a class action lawsuit. In this case, however, the problem with metrics doesn’t make Facebook look better than it is, but worse. The company noted that its advertising community has heard that they are seeing a greater-than-expected impact on their advertising investments on the network, raising concerns.

Facebook has offered advertisers some tips to help them better understand the impact and performance of a campaign in this new era. He suggested waiting a minimum of 72 hours or the entire duration of the optimization window before evaluating performance rather than conducting evaluations on a daily basis, as before. He also said that advertisers should analyze reports at the campaign level whenever possible, as some estimated conversations are reported with a delay. And it suggested advertisers choose web events (like a purchase or signup) that are more aligned with their core business, among other things.

To address issues with improving its metrics, Facebook said it is working to improve its conversion model, accelerating its investments to fill reporting gaps, launching new features to track web conversions, and extending its capacity. to measure in-app conversions in apps that have already been installed. The company said it would work quickly to fix bugs, including one that recently led to an underreport of around 10%, previously shared with advertisers.

The company explained in August how it is working to adapt its personalized ad business in light of Apple and Google’s privacy changes and new regulatory landscape, but these efforts will take time, he said.

Outside of the advertising technology updates themselves, Facebook has also been working on new products that would allow advertisers to better position themselves in front of consumers browsing Facebook apps. Just last week, for example, it revamped its range of business tools with the introduction of new features and smaller test expansions that would give companies more ways to be discovered. One such test in the US would direct consumers to other businesses and topics directly under news feed posts. It now also allows businesses to add WhatsApp buttons to their Instagram profiles and create ads that send Instagram users to WhatsApp business chats.

Facebook has long warned advertisers that Apple’s new privacy features, which allow mobile users not to be tracked through their iOS apps, would cause problems with the way its ad targeting business normally operated. And he has repeatedly argued that Apple’s changes would impact small businesses that relied on Facebook ads to reach their customers. When the changes went into effect, Facebook’s concerns were validated as studies found that very few consumers choose iOS tracking.

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