A term I've heard come up a lot when it comes to one particular aspect of the genre, but let's shed some light on a few other times it may come up.
The biggest situation in which this comes up is magical girls not being recognized when they transform, particularly those whose features such as hair color/style don't change when they transform.
Sailor Moon of course being the queen of this with her highly distinctive meatballs. Early on in the manga the characters had domino mask/glasses things that added an extra layer of imaginary identity concealing, but those were quickly dropped for whatever reason.
Tbh I see this as no different than when the Team Rocket Trio from the Pokemon anime wear a disguise but their very distinctive hairstyle's (Jessie's especially) are still very noticeable.
Kiruminzoo doesn't do the magical girl secret identity thing, but it did have the dark magical girl becoming a phantom thief.
Without this trope, I would REFUSE to believe any sane person who has ever met this girl wouldn't recognize that hairstyle, especially considering the age of the character.
Smile Precure is one of the few shows I can think of that not only have their physical appearances change, but also their identities being obvious, as the queue of lead characters is set up by having the next one in line recognize Miyuki's voice when she's giving a speech to the villains. It's even more noteworthy because at the time none of them have really known Miyuki for long.
So next question might be: Why not make them distinct in appearance? In the case of my own little magical girl story I'm writing, it's because the character's design has become rather iconic to me, so instead her costume produces a barrier that makes her physical features indecipherable by human eyes/technology, so she looks like a sparkling angelic eyesore.
In the case of shows like Sailor Moon I want to say it's for the convenience of the young audience, but again the Cures change appearance. Convenience of the artist perhaps?
This trope seems to mostly apply to magical girl warrior shows. Ojamajo Doremi shows us that a change of costume in no way hides the identities of the magic users, and some of the early item users (such as Creamy Mami) change appearance age as well.
Unrelated to costume identities is magical girls (usually 80s ones) who are blatant about the use of their powers around others. Yuu from the above Creamy Mami occasionally repeats dialog between her two forms, almost like she wants Toshio to figure out who she is so that he'll love her as Yuu, not Mami.
Older magical girls aren't the best at choosing places to use their powers either. Some of them will either clearly speak their incantations in places where someone would be clearly in earshot, or where they'd see the flashing. I seem to recall the latter being actually noticed in some shows such as Creamy Mami, and it's particularly jarring because in her case she HAS to keep it a secret.
I'm watching Pastel Yumi now and it seems like this one doesn't need to hide her use of magic at all. Randomly running away from friends and family to go use magic apparently isn't blatant enough, but she conjures up a hot air balloon and actually gets away with not having to explain it... even when the balloon literally vanishes right before their eyes. The next episode her friend doesn't even address it.
I think this mostly applies to Sailor Moon, but a lot of people refuse to believe that the parents of the magical girls would have no problem with their children leaving the house late at night to do who knows what. It might be different in that show because they're fourteen year olds, but in Creamy Mami the protagonist is nine and has a strict curfew. Precure never seems to have the characters go out at night to fight, the enemies are conveniently diurnal.
It's the kind of thing where you can just shrug it off and say "Kids show". But a talented writer could make a show addressing these kinds of things, having the friends and family become increasingly suspicious about where their child got all these nice things "I WANT SOME NICE THINGS!" and the magical girl would have to be smarter about how to use their magic.