The Ugly Truth Behind Facebook’s New App Marketing Policy

by • June 17, 2015 • Comments (15)


Over the last month, if you’ve been listening closely, you’d be able to hear a quiet rumbling within the app marketing community. In early May, Facebook began informing app marketers of a new policy change – the social media giant would no longer provide device level data back to advertisers via Mobile Measurement Partners (MPPs). These MPP partners include companies like Kochava, Fiksu and even Yahoo’s recently acquired Flurry.

Typically when Facebook makes a big policy change, you’ll hear it being shouted from the mountain tops, but this one feels different. Do a search on the topic and you’ll find one (maybe two) articles that discuss the policy change. Either no one fully understands the deep impact this will have on the app marketing community or Facebook has done a great job muffling the media, so as not to create a panic.

While this policy change may not have hit most major trades or even seem like a big change to the way advertisers will work with Facebook in the future, the decision to no longer provide device ID’s through MPPs will have a major impact on the entire app ecosystem.

To understand the impact, we must first understand the importance of the data itself. Collecting device level data allows app marketers to not only retarget consumers more efficiently across their mobile device(s), it also allows them to derive ad attribution. In the past, app marketers would be able to determine what Facebook ads drove downloads and, more importantly, which of those downloads provided quality Lifetime Value; otherwise known as LTV. Once they understood these pieces of the puzzle, they would be able to create look-a-like models for future campaigns in an attempt to drive downloads of similar value.

The recent changes to how Facebook shares data with app marketers, essentially negates both of these practices; making it much more difficult to understand ROI on the platform. To put this into context, let’s look at a hypothetical example.

Let’s say in a month’s amount of time, an app marketer spent $100,000 on Facebook app installs, $100,000 on display ads and $100,000 on value exchange traffic. Post campaign analysis reveals the campaign resulted in a Cost Per Install (CPI) by ad product of $5, $8 and $1 respectively. Now, prior to the recent policy change, that marketer would have been able to attribute the following:

  • 20k installs to FB
    • LTV of $20
  • 12.5k installs to Display
    • LTV of $16
  • 100k installs to Value Exchange
    • LTV of $10
  • 25k installs (conservatively) to Organic Traffic
    • LTV of $17

In the new Facebook model, this app marketer would still be able to see most of this information, but with one major difference. Because FB will no longer be providing device level data, those 20k Facebook installs will essentially be lumped in with the organic installs via your MPP dashboard. So while you’ll be able to understand that your $100k of Facebook media drove 20k installs out of the (now) 45k installs tagged organic, they won’t be able to determine which traffic source (Facebook or Organic) drove installs with higher LTVs. As you can imagine, these numbers become even more difficult to decipher if you’re a major app advertiser, like Supercell, spending millions across multiple platforms; some with little to no attribution like Traditional TV or OOH.

CoCAt a difference of $3 more an install and $4 less LTV, would it actually be worth it to this advertiser to simply focus their efforts towards display versus continuing to spend on Facebook? While it seems less efficient in the short term, the granularity in reporting will allow them to model off this traffic more efficiently; ultimately creating cost savings on the front end and increased long-term ROI post-install.

Alternatively, the same advertiser could begin to shift their budget more towards mass awareness vehicles, like TV, since we know traditional TV CPM’s are on the decline (especially on cable networks) and they are already seeing a $17 LTV from their organic downloads. In either case, Facebook’s new policy could actually end up having negative effects on their overall mobile revenue, of which 50% is made up of app install campaigns, according to recent eMarketer reports.

While Facebook positions this as a shift towards ‘people based measurement, with a focus on audiences instead of devices’ and places app install campaigns on a level playing field with the rest of their ad products, several MPPs have agreed that this change in data sharing could be an underhanded move by Facebook to force app marketers to begin using their analytics tools like the Facebook SDK; ultimately giving the social media giant insights into data like post-download engagements and cutting MPPs out of the mix in the future. This is one area Facebook doesn’t have a lot of data and this highly coveted information could be a huge benefit back to their ad business moving forward.

In the face of such diminished reporting the decision ultimately falls upon the app marketer to determine if spending on Facebook, simply to take advantage of the mass scale of the platform, is still as valuable as it once was. Is it better to have transparency on attribution or mass scale? Many of the larger app marketers are already working to make a decision on this topic, but early reports show that many of them are struggling to justify large portions of their budget being spent on a digital platform that will no longer track back to the associated LTV of a user.


15 Responses to The Ugly Truth Behind Facebook’s New App Marketing Policy

  1. JD says:

    So is this bad enough that you’ll stop buying ad inventory on FB to promote your apps?

    • Dan Wittmers says:

      While I can’t comment on the NBCU clients’ strategies directly, nor can I say entire budgets will be shifted away from Facebook, I firmly believe it’s big enough for any app marketer to take very seriously. The fact that no major publication is reporting on it actually reaffirms my belief. LTV modeling is how successful app marketers plan their marketing strategies. Any time you muddy those waters, you’re going to need to adjust your formulas and subsequent media strategies accordingly.

  2. Paul Gelb says:

    You should add the impact it will have to reengagement app spend, including reactivating dormant users and moving users down the adoption funnel for app features like mobile payments and loyalty.

    • Dan Wittmers says:

      You’re exactly right Paul! This change will have a negative impact on advertisers’ ability to reengage users on Facebook. I believe reengagement becomes possible again if you install the Facebook SDK (feel free to correct me on this point), which is that ugly truth part. Seems like FB is simply posturing to force advertisers to use their products in order to access a full stack of capabilities.

  3. Eric Seufert says:


    As far as I understand FB’s policy change, your analysis is incorrect. FB will still provide device IDs to MMPs, so they’ll be able to calculate ROI on paid media. This policy change just prevents MMPs from providing device IDs to advertisers. The article you link to says as much:

    “Specifically, this means Mobile Measurement Partners will no longer be able to provide device-level reporting for Facebook mobile app ads. MMPs will be able to report down to the ad level for Facebook mobile app ads, in line with how we report performance for all other Facebook ads.

    Beginning May 20, new advertisers will not be able to get device level reporting from MMPs. On Aug. 20, the change will go into effect for all advertisers.”

    I could be wrong (I’ve heard a LOT of conflicting information around this change), but my understanding is that advertisers will still be able to calculate LTV on a Facebook ad campaign, but only via their MMP’s tools and not within their own BI systems

    • Dan Wittmers says:

      I spoke to executives from 3 different MMP’s prior to publishing this article and none have contradicted my analysis thus far. To clarify, you’ll be able to calculate LTV of an install through your MMP, but you won’t be able to associate it back to your Facebook spend. The MMP has to be able to tag an install as coming through Facebook and share that information with the advertiser in order to ultimately attribute that individual user’s LTV back to your spend. This cannot be done with only campaign level reporting. Only receiving campaign level data also takes away an advertisers ability to model look-a-likes or reengage users efficiently.

      What I can tell you is that the MMP’s are still in conversations with Facebook. Thus far, they haven’t had much luck getting any real feedback on what will and will not be allowed under this new policy. Hopefully I’ll be able to update this post with some good news in the not so distant future, but for right now, this new policy should have every app marketer (re)evaluating their strategies.

      • Eric Seufert says:

        From a blog post Fiksu just published:

        “So that’s the situation. Using an MMP will still give you access to the LTV metrics by channel that you need to effectively manage your mobile marketing campaigns. More importantly for us, we’ll still be able to get the detailed, ad-level information that we can use to optimize across Facebook, Twitter, RTB, and other programmatic mobile ad channels.”

        Looks like this change will have almost no impact outside of using device IDs for retargeting, the value of which is, in my opinion, overstated.

    • Simon says:

      Simon from adjust here.

      This is correct, this change only affects the data that MMPs are able to forward to advertisers. MMPs will still be able to collate revenue data and compare this per ad, as we’ve been able to do up until now. There’s a lot of unfortunately worded terminology flying around that I think contributes to a lot of the uncertainty. Fundamentally the MMP tools are not changing, only the data output to advertisers.

      • Dan Wittmers says:

        Thanks for the comment Simon! There’s no doubt about the fact that my analysis is a bit aggressive. Coming from the advertiser side, I have issues with where this is headed as we look towards an app-dominated future. I don’t think anyone can deny that aggregate LTV is not as actionable as user-level and what happens when Facebook decides to cut MMPs out!? If I can garner similar numbers through other traffic sources AND maintain user-level visibility, shouldn’t I spend my time/budget there?

  4. Jeremy says:

    As one of the companies mentioned in the article, Fiksu would like to set the record straight on an important point: Eric, posting above, is correct, Mobile Measurement Partners will still be able to use device IDs for measuring LTV and reporting aggregate data on Facebook campaign performance, along with all the other channels we buy on. We’ll also be able to do re-engagement campaigns as normal.

    The change is that we will no longer be able to share the actual device IDs attributed to Facebook with our clients. While you’re right that it is a significant change, it actually doesn’t impact most MMP clients, unless they have been importing IDs into their own systems for further analysis.

    Let me know if you’d like more info.

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  6. Daniel says:

    Daniel from AppsFlyer here kicking in with my two cents…

    The recent changes announced have left a lot of advertisers unsure about what lies ahead. The fact that this article states that MMPs will not have access to device-level data goes a long way to showing the confusion that exists. It is important to state that we continue to have access to all the data necessary for the most accurate attribution data across all channels (including Facebook) and in real-time.

    In addition, we’re also taking steps to ensure that advertisers are able to keep focusing on their ad operations and know that AppsFlyer will always bring the best tools to help them do that. This is why we recently added important metrics for Facebook campaigns including impressions, clicks, cost and ROI.

    All of these metrics have not been available through MMPs up until now and this unique offering is another indication that our vision is leading the way. This comes in conjunction with our real-time communication with Facebook and other re-targeting networks which enables the seamless creation of custom audiences, ensuring that advertisers can target the users with whom they want to re-engage in a matter of minutes.

    In short, we provide all the data, features and tools which will enable advertisers to calculate true ROI and LTV across Facebook campaigns, as well as all other channels.

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