NEW YORK For the Internet industry, a brewing consumer backlash against cookies triggers flashbacks to the privacy battles of Web advertising's early days in the 1990s. Now, with more privacy threats and easier tools for ditching cookies, a growing number of consumers are reacting against marketers tracking their Web behavior.
If the backlash against cookies continues, it could impede advances in ad targeting and accountability, according to industry experts. Behavioral targeting, for instance, is widely considered one of the most promising advances taking shape for Web advertising, but it requires cookies to track browsing habits.
"I think we ignore this at our own peril," said Trevor Hughes, executive director of the Network Advertising Initiative, which sets Internet cookie standards for marketers. "We need to realize there are still concerns in the marketplace, and respect those concerns."
Estimates vary on how widespread cookie deletion is. Jupiter Research estimates 39 percent of Web users delete cookies monthly, and other estimates put the figure as high as 50 percent. Blocking of third-party cookies has risen from 2.4 percent in January 2004 to 13.2 percent this past June, according to WebTrends, a Net analytics firm. The end result, according to agency executives, is that it is more difficult to target ads and track results-the capabilities driving ad money from traditional media to online.
For now, the damage from deleted cookies is manageable for Web marketers, said TS Kelly, vp and director of research and insight at the Havas-owned Media Contacts agency. Advertisers' frequency and reach numbers are still accurate. And since most direct-response ads are acted on within a month, advertisers can still measure their returns-certainly better than traditional media, Kelly added. The biggest impact Media Contacts has seen is for high-consideration goods such as cars and travel, which have longer sales cycles that can make it difficult to gauge the effect of online ads on conversions.
Industry executives said causes of the anti-cookie backlash are varied. Consumers in general are more sensitive to data-protection issues in the aftermath of highly publicized information breaches. The rise of spyware, phishing and viruses has contributed to a growing sense of online dangers, which is stoked in some cases, executives charge, by companies that provide software to combat such threats. Industry trade groups are mulling how to explain cookies' good points to consumers. The Interactive Advertising Bureau has convened a task force to tackle the issue. It is sifting through the conflicting cookie deletion and blocking reports to get a handle on the problem before recommending a course of action, said Greg Stuart, the IAB's CEO. "There's a lot of misunderstanding," he said.
--Brian Morrissey
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