The Potential of Progressive Web Apps to Push Apple from Mobile Space Dominance Post-iOS 14.5
With the long-discussed IOS 14.5 updates rolled-out, Apple has made its position as champion of the consumer very clear. That’s assuming that the consumer will side with them on the ATT privacy plans being rolled out – and as far as Apple is concerned, that's all it needs to worry about.
Apple is now ranked as the most profitable company globally, largely thanks to the pandemic. However, we need to remember that it has been implicated in moving intangible capital assets – such as IP royalties – around to avoid paying tax and denying tax income to governments in the locations where it actually sells its products. The resulting shortfall has to come from somewhere, usually the residents of that country.
While the latest privacy updates are positioned by Apple as benefiting these same consumer residents, they have prompted criticism from the digital advertising industry – with targeting and effectiveness being limited – as well as brand app developers.
Add to this that Apple has in fact recently released its own targeted ad product, which allows App Store advertisers to bypass the “search” function and target consumers in the “suggested” section, even its claims as a consumer champion could be questioned. These latest updates might have a far-reaching impact on Apple itself, as well as brands operating in the mobile space, and the consumers they serve there.
The Relationship Between Brands, Apple and Apps
With a number of market changes currently happening – including the rise of Progressive Web Apps (PWA), increasing privacy concerns and realistic global solutions, and the increased restrictions Apple imposes – Apple’s dominance in the mobile device space could be set to decline.
We're currently at a mid-point and precursor to PWA, which allow brands to bypass an app-store and retain direct communications with customers, including privacy preference messaging and capturing. Broadly speaking, right now there are a mix of brands that either A) don't use apps B) develop React Native apps or C) develop Native apps.
React Native is used as a method for developing multiple apps using the same code-base and as such reduces the costs and efforts required to develop two or more Native apps for platforms such as Android and iOS. Native is selected generally when the opinion is that the outcome for the end-customer will be far better by adopting the full Native capabilities – such as responsiveness, security and intuitive experience – of that app development framework.
If a brand develops an app, either Reactive Native and Native, it is normally quite a separate development effort to their website and therefore very costly to build and maintain. This is before you consider that Apple will take a hefty commission on any in-app purchases.
PWAs can operate outside of an app-store, with an icon installed on to a consumer’s device homescreen, directly from a brand’s website on their browser. With PWAs, a brand can continue to engage with its consumers and have control over the relationship it has already established, in a way that best meets that consumer’s needs.
This includes managing messaging and agreements on individual privacy preferences, and ensuring an understanding of the value exchange that forms part of the customer experience.
Privacy and Brand Investment in Apps
Many brands will continue to front app costs for a number of reasons. For some, the app platform is their primary touch-point with the end customer and as such there isn't really a viable alternative. For others, it is a desire to remain competitive and ensure they're meeting customer expectations.
In both cases, if the rules of engagement are becoming increasingly punitive by Apple this simply increases the costs involved for brands to build and maintain the app.
Imagine a scenario where the app is the primary touch-point, and advertising is the primary source of income; the only way this app will survive is if the customer specifically opts-in for advertising. That might sound like a viable trade-off – and I think it actually is – but now imagine that you, as the brand app owner, cannot control how that message on privacy preferences is delivered to your customer. This is the problem.
Factor all of the above with an industry move towards more data and privacy transparency, and there could be major issues heading Apple's way. It is trying to stand up as a shining beacon and voice of the privacy conscious consumer. Let's be honest though, it is about as capitalist as they come; its net income in 2020 was $57bn.
My view is that they want consumers’ money, and as much of it as possible; this indicates an attempt to try and control the market, and privacy appears to be a vehicle for this. However, the stakes may have just got too high for businesses to continue to gamble their chips on Apple's table; a shift to PWAs has the potential to push Apple from the top spot.
Take Control of Relationships to Avoid Reliance on Apple
With all these market changes, brands should be working towards privacy and transparency by design; trying to continually get around privacy rules is not a privacy strategy. Consumers do demand privacy controls, and certainly do want transparency, but they don't want it to be complicated and continually changing.
All businesses should be completely transparent about what they're doing with customer data and allow people to at least opt-out of who their data is shared with, even if it is 'anonymous'.
Brands should move to take control of their own relationships – including privacy and data management – and not be reliant on Apple or anyone else to manage it for them.
The process of natural selection will take place and those with weak business models that don’t offer value to the customer for using their data will be left to wither and die. Businesses that are creating direct compelling experiences and value for their customers in exchange for their data will flourish.
To take control and overcome the possible impacts of Apple’s updates, brands should be weaning themselves off what have appeared as easy platforms – such as iTunes Store for example – to reach their customers.
PWA are one of the long term options to do this in a way that gives brands the control over their relationship with the customer, but also allow them to easily provide seamless cross-device and platform experiences – which form part of the value equation – and a strong foundation for future engagement.