iOS in-app advertising market to lose nearly a fifth of value this year

Apple’s imminent user-privacy rule changes, limiting advertisers’ access to the unique identifier for iOS devices (IDFA), will cause iOS in-app advertising revenue to dip by nearly a fifth below original expectations this year, according to projections made in Omdia’s latest App Ecosystems Forecast: 2020-25.

Omdia estimates that 17% will be wiped off the value of the iOS in-app ad market in 2021 (see figure). Over a third of this shortfall will be revenue lost to other forms of advertising or held back; nearly two-thirds will be revenue redistributed to Android in-app ads, as iOS ads lose almost 60% of their premium over their Android counterparts. The loss of attribution and targetability of iOS ads, resulting from the anticipated nosedive in iPhone/iPad users consenting to being tracked by advertisers, should lead to higher demand and higher prices for Android ads.

iOS users will, however, remain highly valuable targets for advertisers. According to Omdia’s forecast, iOS users spent on average 4.7 times more on apps than Android users in 2020. So marketeers and ad-tech platforms will do their best to find workarounds to the lack of IDFA data. And Omdia expects that, by 2024, iOS in-app ads will have recovered much of their originally projected premium.