Apple allows advertisers to track an iPhone/iPad through what is called IDFA (identifier for advertisers). Basically, it's like the advertisers pin a number to your device (you and your device remain completely anonymous nevertheless) so that they can serve better ads based on what you click and what you don't. Incidentally, a few months back, there was a crackdown on IDFAs that has left a lot of advertisers fuming over Apple's move. (Pleare refer this how to for iOS 8.)
This is one of the lowest forms of tracking and it's quite anonymous too. But if you want to stop even this, Apple makes sure there's a way to do that on your iPhone or iPad. The feature came about even in iOS 6 (and we wrote about it). This is just a refresh to that piece.
iOS 7.x Limit Ad Tracking
- Open the Settings app
- Tap on Privacy
- Scroll down and tap on Advertising
- Turn on the switch for Limit Ad Tracking
- Optionally, if you want to reset ad-related identifiers, tap on Reset Advertising Identifier (and then on Reset)
In the previous iOS version, Advertising was hidden inside General → About but Apple has changed the listing now. It's under Privacy which, I think, is the apt place for this setting to reside in.
Note that limiting ad tracking doesn't block ads. In fact, there is no way to block ads in apps and games that serve ads except this technique which basically turns the Wi-fi and cellular off.
Like we wrote before, ad-tracking on Apple's devices is really anonymous and safe. In the recent turn of events, Apple blocked advertisers from accessing the IDFAs if they weren't serving ads. Apple does take issues about privacy strongly and the entire iAds ecosystem is built around this. It is not known if the recent video iAds movement comes under the ambit of IDFAs (and general iOS ad tracking) but nevertheless, you know how to limit ad tracking now.