Facebook Advertising 2021

Identifying Strategies for a Post-IDFA, Post-Pixel Reality

Report by Audrey Schomer  | Nov 4, 2021
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Table of Contents
Executive Summary
Key Points
What’s the Opportunity for Facebook Advertisers?
Facebook’s Exposure to iOS Changes Intensifies the Pressure on Advertisers
How Facebook Advertisers Are Adapting to Changes
Insider Intelligence Interviews
Read Next
Sources
Media Gallery
About This Report
Advertising on Facebook has become more challenging due to Apple’s AppTrackingTransparency framework in iOS 14.5. Here’s how advertisers are adapting their strategies in the post-IDFA reality.
Topics
Digital Ad Spending
Social Media Ad Spending
United States
Table of Contents
Executive Summary
Key Points
What’s the Opportunity for Facebook Advertisers?
Facebook’s Exposure to iOS Changes Intensifies the Pressure on Advertisers
How Facebook Advertisers Are Adapting to Changes
Insider Intelligence Interviews
Read Next
Sources
Media Gallery

Executive Summary

Apple’s rollout of its iOS 14.5 update has created significant challenges for many Facebook advertisers in recent months. Marketers are adapting to changes in how they target audiences, measure and attribute performance, and optimize their campaigns on Facebook in response.

How much will US advertisers spend on Facebook ads?

We estimate that net US Facebook ad revenues will grow 32.1% year over year (YoY) to $50.30 billion in 2021. That’s a significant increase versus our March 2021 forecast, when we predicted growth of 26.6%. Next year, growth will decelerate to 15.5%, dampened slightly by iOS privacy changes.

How has Facebook been affected by iOS 14.5 changes?

Facebook has experienced signal loss since Apple’s AppTrackingTransparency (ATT) framework in iOS 14.5 took effect in late April. Facebook no longer receives information about off-platform actions by Facebook and Instagram app users who have updated to iOS 14.5 or higher on their devices and opted out of tracking.

How are Facebook advertisers affected by iOS 14.5 changes?

Direct-response (DR) advertisers—those driving any type of lower-funnel action, like a purchase—have seen performance declines on their Facebook ad campaigns due to the impact of signal loss on targeting, measurement, and attribution. Advertisers using Facebook for branding reach have been less affected or not at all.

How are advertisers adapting to changes in targeting, measurement, and attribution on Facebook?

Advertisers are pursuing strategies that depend on first-party data, including bringing their own customer data into Facebook and relying more on Facebook’s own user engagement data. Aligning creative messaging to specific audiences will also become more powerful as a lever for ad personalization.

WHAT’S IN THIS REPORT? Our latest Facebook and Instagram ad spending forecast estimates, analysis of the effect Apple’s ATT framework has had on Facebook, and advertiser strategies to mitigate the impact of signal loss from IDFAs and the Facebook pixel.

US Facebook Net Ad Revenues, 2019-2023 (billions, % change and % of total digital ad spending)
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KEY STAT: This year, US advertisers will spend $50.30 billion on Facebook ads, up 32.1% YoY.

Here’s what’s in the full report

2files

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17charts

Reliable data in simple displays for presentations and quick decision making.

23expert perspectives

Insights from industry and company leaders.

    Table of Contents

    1. Executive Summary
    2. Key Points
    3. What’s the Opportunity for Facebook Advertisers?
    1. Facebook’s Exposure to iOS Changes Intensifies the Pressure on Advertisers
    2. How Facebook Advertisers Are Adapting to Changes
    3. Insider Intelligence Interviews
    1. Read Next
    2. Sources
    3. Media Gallery

    Charts in This Report

    US Facebook Net Ad Revenues, 2019-2023 (billions, % change and % of total digital ad spending)How Has the Forecast for US Facebook Net Ad Revenues Changed? (billions, 2019-2023)
    US Facebook Ads Android Smartphone Cost per Thousand (CPM), April-Sep 2021 (% difference vs. iPhone)US Facebook Mobile Ad Spending, by OS, April-Sep 2021 (% change vs. same period of prior year)
    Net Core Facebook vs. Instagram Ad Revenues in the US, 2019-2023 (billions)US Core Facebook and Instagram Net Ad Revenue Growth and Share, 2019-2023 (% change and % of total Facebook net ad revenues)
    Net Instagram Stories Ad Revenues Worldwide, 2019-2023 (billions, % change, and % of total Instagram ad revenues)Net Instagram Feed Ad Revenues Worldwide, 2019-2023 (billions, % change, and % of total Instagram ad revenues)
    To What Extent Do US Marketers and Agencies Anticipate the Performance of Select Media Types Will Be Affected by the Phaseout of Third-Party Cookies and IDFA? (% of respondents, April 2021)Average Time Spent with Select Apps Among US iPhone Users, Gen Z vs. Total Adults, March 2021
    Industries US Agencies and Brand Marketers Are Buying/Plan to Buy Facebook Ads for, by Branding vs. Direct Responses, Nov 2020 (% of respondents)US Agency/Marketing Professionals' Usage of Media Companies for Digital Retail Advertising, Feb 2021 (% of respondents)
    How Do Social Media Professionals Worldwide Collect and Integrate Social Data to Measure Performance? (% of respondents, Sep 2020)Solutions that US Marketers and Agencies Are Using to Grow/Enhance Their First-Party Data, June 2021 (% of respondents)
    US Businesses that Currently Sell vs. Anticipate Selling* on Social Media Commerce Platforms According to US Business Executives, by Company Size, Feb 2021 (% of respondents in each group)US Facebook Social Commerce Buyers, 2019-2025 (millions, % change, and % of Facebook users)
    US Instagram Social Commerce Buyers, 2019-2025 (millions, % change, and % of Instagram users)

    Interviewed for This Report

    Chris Apaliski
    Adlucent
    Senior Director, Social
    Interviewed September 1, 2021
    Avi Ben-Zvi
    Tinuiti
    Vice President, Paid Social
    Interviewed September 29, 2021
    Brian Bowman
    Consumer Acquisition
    CEO
    Interviewed September 24, 2021
    Bryan Cano
    StitcherAds
    Director, Media Strategy
    Interviewed September 22, 2021
    Carly Carson
    PMG
    Director, Social
    Interviewed May 30, 2021
    Shamsul Chowdhury
    Jellyfish
    Vice President, Paid Social
    Interviewed August 25, 2021
    Sean Clayton
    Mindshare
    Executive Director, Solution Officer
    Interviewed August 31, 2021
    Benjamin Dailey
    Birchbox
    Director, US Community Strategy and Advertising
    Interviewed September 24, 2021
    John Dobrowolski
    Skai
    General Manager, Social and Apps
    Interviewed September 9, 2021
    Adam Gerber
    Horizon Media
    Vice President, Digital and Social Performance
    Interviewed September 23, 2021
    Gogi Gupta
    Gupta Media
    Founder
    Interviewed August 24, 2021
    Kunal Gupta
    Polar
    CEO
    Interviewed September 8, 2021
    Ann Herrick
    AreYouGame.com
    Senior Digital Marketing Director
    Interviewed September 28, 2021
    Shuree Jones
    Rain the Growth Agency
    Director, Paid Social
    Interviewed September 30, 2021
    Allie Karr
    The Hershey Co.
    Senior Manager, Integrated Media
    Interviewed September 15, 2021
    Alon Leibovich
    BrandTotal
    CEO and Co-founder
    Interviewed September 21, 2021
    Danisha Lomax
    Digitas
    Senior Vice President, National Paid Social Lead
    Interviewed August 26, 2021
    Ty Martin
    Ad Bacon
    Founder and CEO
    Interviewed September 13, 2021
    Cory Munchbach
    BlueConic
    COO
    Interviewed August 30, 2021
    Erica Patrick
    Mediahub Worldwide
    Senior Vice President, Director of Paid Social Media
    Interviewed September 24, 2021
    Robert Pearsall
    Omnicom Media Group
    Managing Director, Social Activation
    Interviewed September 8, 2021
    Amy Rumpler
    Basis Technologies (formerly Centro)
    Senior Vice President, Paid Search and Social
    Interviewed September 1, 2021
    Ilon Weeldreyer
    Merkle
    Associate Director, Performance Media
    Interviewed September 30, 2021

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    authors

    Audrey Schomer

    Contributors

    Debra Aho Williamson
    Principal Analyst
    Jasmine Enberg
    Senior Analyst
    Nazmul Islam
    Junior Forecasting Analyst
    Natalie McGranahan
    Senior Researcher and Taxonomy Manager