A glitch in Facebook’s ad platform sent faulty data about campaigns to advertisers, causing brands to lose visibility into how well ads were performing on Apple iPhones. The incident has become yet another example of how Apple’s new privacy rules are causing some chaos in the industry.
On Tuesday, Facebook sent an email to advertisers that were affected by the “bug,” which had been undetected since February. The bug meant that some advertisers received incomplete information about when an ad led to an app-install, which are known as conversions. A conversion happens when the consumer on the other end of the device downloads the app that is being promoted, and in this case Facebook underreported just how well its ads were working.
The reason Facebook was not able to see all the conversions was because Apple recently made changes to its iPhone software and implemented new data restrictions that give developers like Facebook less information from the devices. Facebook has to use Apple’s proprietary SKAdNetwork to report advertising metrics, like conversions, back to advertisers. The bug was due to a faulty connection between Facebook's ad platform and Apple's SKAdNetwork, and it only affected iPhone 12 devices, the social network said.
“Based on our [Apple] iOS user base, we believe around 10% of total SKAdNetwork conversions were not counted or reported,” Facebook said. “The impact on specific campaign metrics will vary.”
Advertisers have been dealing with a chaotic ad environment all year, even before this glitch. Major internet ad companies like Facebook, Google, Snapchat, TikTok, Twitter, Pinterest and others are adjusting to Apple’s privacy framework so they can operate on its devices and still manage effective ad campaigns for millions of advertisers. In April, Apple’s iOS 14.5 software implemented new anti-tracking measures that forced apps to get express permission to collect data on users coming from iPhones.
Some advertisers have said that Facebook's conversion reporting has been spotty, in general—not just on app-install campaigns—since Apple's iOS 14.5 update. Advertisers have told Ad Age that Facebook is not able to get credit for all the sales and conversions it helps generate through its ads platform. That is a problem for Facebook, because if it can’t prove that its ads are working, advertisers could change strategies, ad industry experts say.
“It goes into budget planning,” says Katie Buczkowski, director of social media at Ludwig+, an independent ad agency that helps brands buy ads on Facebook. “If an advertiser is seeing underreporting it would move money to other platforms.”
Facebook has more than 10 million advertisers, many of them are small- and medium-size businesses that rely on the social network to reach new customers and generate sales. There also are major brands, game makers, food delivery services, fast-food restaurants, retailers and others that use Facebook campaigns to drive downloads of their apps.
App-install advertising, the kind that was affected by the bug, is a science for many marketers who have worked out complex calculations about how much they need to spend on app-install ads to grow their customer base, and how much they can expect to earn over the lifetime of those customers. The advertisers are experts at setting the campaigns with just the right bids to win the auctions and drive downloads, but that all depends on accurate reporting, Buczkowski says.
“The implication of this means that the data issue is causing advertisers to make decisions and optimizations based on erroneous data,” she says.
The metrics mishap is reminiscent of when Facebook had a bug in its system that overestimated the performance of videos. In 2016, Facebook apologized for sharing inflated measurements regarding organic videos—meaning it did not apply to paid ads. Some advertisers sued Facebook, claiming that the inflated metrics led them to make ad buying decisions they otherwise might not have made.
In 2019, Facebook settled that case for $40 million. This case is different, because the reporting problem actually works against Facebook, underestimating the performance of its ads.
Eric Seufert, a marketing analyst at consulting firm Heracles Media, estimated the Apple ads glitch could have affected 100 million iPhone 12s. The iPhone 12 is the latest model from Apple, and while it may account for about 10% of iPhones in circulation, most of those consumers are in areas where Facebook users provide the most value, Seufert said in a Twitter thread. “This must have dramatically, negatively impacted reported iOS ad campaign performance,” Seufert said.
Graham Mudd, head of business products at Facebook, said on Twitter that “this was a technical bug on our side that we recently discovered and fixed.”
The fix comes at an important time for marketers that are about to plan for the holidays, Buczkowski says. “We are in the middle of coming up with budgets and recommendations for clients," she says. "So if we put money into Facebook, we know that we could see better results.”