Meta's recent announcement of a 30% fee on boosted posts in Facebook's and Instagram's iOS apps has caused some kickbacks across the digital marketing sector.
This new policy is said to take effect in March 2024, and comes as a response to Apple's 2022 App Store update, extending its 30% commission to now include boosted posts, considered to many as Meta ads.
This will impact businesses, particularly small enterprises and influencers, who rely on boosting posts to enhance their visibility and reach.
What Exactly Is Meta's 30% Boosted Ad Tax?
Under the new policy, advertisers purchasing boosts on iOS will now be billed through Apple, incurring a 30% service charge on the total ad payment. This shift poses a significant financial burden on businesses, diminishing the effectiveness of their advertising budgets.
Not only will there now be a 30% charge on top of your ad spend but users will be required to purchase ad credits up front. This new payment process, initially rolling out in the US before expanding to other markets, adds complexity and cost to advertising campaigns, impacting businesses' ability to allocate resources efficiently.
What Does This Mean For Meta Marketing Campaigns Going Forward?
Luckily, there is a way around this new 30% tax, as it is only linked with Apple's app store update. Meta suggests an alternative route by allowing users to purchase boosts through Facebook's and Instagram's websites on desktop, circumventing the Apple fee. However, this workaround may not be feasible for all businesses, especially those heavily reliant on iOS devices for their marketing efforts.
What Was Apple's & Meta's Response To This New Policy?
Apple's insistence on enforcing its In-App Purchase system for boosted posts is met with criticism from Meta and other affected companies. While Apple argues that boosting constitutes a digital service and thus falls under its purview for In-App Purchase, Meta contends that the imposition of such fees hampers businesses' ability to promote their products and services effectively.
In response to Apple's policies, Meta is among several companies vocal in their opposition, citing concerns over fairness and competitiveness. Apple's introduction of additional fees, such as the Core Technology Fee for developers in the European Union, further intensifies the debate surrounding its app store practices.
The ramifications of Meta's 30% fee on boosted posts extend beyond financial implications. Small businesses, already grappling with economic challenges, may find it increasingly difficult to compete in the digital marketplace. The reduced visibility resulting from limited advertising budgets could hinder their growth prospects and jeopardise their sustainability.
The 30% Meta ad fee on boosted posts underscores the complex dynamics at play in the digital advertising ecosystem. Businesses must adapt to these changes by embracing innovation, resilience, and strategic agility.
Collaborating with experienced digital marketing partners like us at Swype® can provide businesses with the insights and expertise needed to navigate this evolving landscape. This will help you as a business achieve your marketing objectives despite the challenges posed by these new policies.