IT HAS BEEN A TOUGH couple of weeks for cookies. That's what happens when you run afoul of Walt Mossberg, the venerable personal technology columnist for The Wall Street Journal. Not only did he devote an entire column and part of another to issues that he has with some cookies, but he also took the time to respond to a high-profile blog post critical of his column.
Basically, Walt doesn't like the fact that some Web sites set "tracking cookies" on his browser as he surfs the Web. While he is fine with cookies that he can identify, like those that perform tasks such as remembering his password, he does not see value in what he terms "secret" cookies placed by advertising service companies or other companies he does not know. He feels violated by the use of these cookies, since he did not give permission to the companies to place these "tracking cookies."
While there is certainly a story in itself on the changes in the media landscape that now require one of the world's most important personal technology pundits to spend part of his Friday evenings reading and reacting to the blogosphere, suffice it to say that Walt's concerns about the use of cookies is a big thing to anyone in the online industry. Not only did Walt's column incite dozens of critical responses, but it also has sparked a number of stories on the subject in general consumer media publications as well. This story is going to get much bigger before it goes away.
I disagree with Walt's position, but not for the same reasons that many others have. While I may think that several of his concerns about cookies are based on imperfect perceptions, I believe that the blame for the misplaced concerns lies clearly with the industry, and not with consumers or critics like Walt.
Before I begin, I must disclose my biases. First, my company uses behavioral targeting and the cookies that Walt complains about to deliver online advertising solutions. Second, I am a huge fan of Walt, and since my 1997 purchase of a VIAO, have bought a number of machines and PDAs only because Walt recommended them.
My first issue with his analysis is his attempt to break cookies into two classes, "good" cookies and "tracking" cookies. Let's be perfectly clear: ALL cookies are "tracking" cookies. Whether the cookie is placed to remember a person's password, to localize their weather report, to permit a site to recognize them as they browse, by an advertiser ensuring the same user doesn't see the same ad more than three times--whatever it is, they all "track" the user.
Segregating a limited group such as "tracking" cookies and labeling them as bad is wrong. Cookies are not inherently bad because they track browsers. That is what they all do. If cookies did not exist, much of the Web experience that users have today would not work. It would be sort of like removing the unique ID from the chip in your cell phone. It might make you feel impervious to any potential for privacy violations, and I suppose you might be able to save money, since the phone company wouldn't know who to bill when you used the phone. Of course, it would probably make your phone useless, since the network wouldn't be able to recognize you or your number when either you tried to make a call or someone was trying to call you. I suspect that is why, unlike the way cookies are treated in browsers, you don't have the ability to delete the unique ID features in you phone. The unique ID is there for a purpose, and the purpose is not inherently bad.
Why is this important?
The cookies that concern Walt are not "secret," nor are they delivered without the user's permission. For all reputable sites, including WSJ.com, their use is fully disclosed in their privacy policies. In fact, many argue that they are an implicit part of the "Terms of Service." In other words, if you want free content, you must accept the fact that the site is going to try to place cookies. You can block them. You can delete them. But you can't say that you didn't expect them. In addition, users control cookies. All of the major browsers have features that can be set to notify users every time a cookie is set, or to block cookies according to pre-set rules.
The problem is that no one has taken the time to educate consumers about what their cookies do and what to expect from them. Of course, before the days of browser-based cookie controls and anti-spyware software, this didn't matter. Cookies just happened in the background, and consumers rarely saw them or played with them.
Now, however, the game has changed. Consumers are in control. They are all like Walt. If they don't know what these things are, they assume the worst. Now is the time for those that place cookies to step up and fill this void. Now is the time for the industry to step up. Walt is just the messenger. Don't shoot him. Listen to him. Inform him. Delight him with what cookies can do for his browsing experience.
Thursday, July 28, 2005
Thursday, July 21, 2005
The Web cookie is crumbiling - and marketers feel the fallout
Internet cookies used to be a treat for marketers looking for ways to measure advertising response, but lately they've become a lot less tasty.
Cookies are tiny text files exchanged between Web servers and browsers. They're stored as files on an Internet user's computer to anonymously identify the sites where people surf and shop. Lately, however, the effectiveness of cookies is being threatened, and experts say that could have a damaging effect on on-line marketing in general.
A recent study by international research advisory organization JupiterResearch has found that nearly 60 per cent of American Internet users have deleted cookies from their primary computers, with 39 per cent doing so on a monthly basis. According to the report, as more and more people block or delete cookies, it could cause the long-term measurement of consumer Web surfing behaviour to be "severely compromised."
"The effect that this will have on on-line marketers is fairly substantial," says Eric Peterson, a senior analyst with JupiterResearch and author of the report. "People doing affiliate marketing [revenue sharing between site publishers and advertisers], those with long lead times between marketing response and actual purchases, and any site that depends on cookies to identify users over multiple sessions is affected by this problem."
"The more people that delete cookies, and the more frequently that cookies are deleted, the more it will adversely affect campaign performance," echoes Jay Aber, president of ad network 24/7 Canada Inc., which sells advertising on more than 250 Canadian sites, including Lycos and YellowPages.ca. Mr. Aber notes that publishers and advertisers primarily use cookies to accurately measure a campaign's reach and effectiveness, limit the number of times a consumer sees a specific ad, and deliver "targeted" advertising to users based on their surfing habits and preferences.
Among the problems associated with deleting cookies, they say, is that repeat visitors can mistakenly be counted as new ones, skewing site and campaign statistics that marketers rely on to gauge audience reach and return on investment. Advertisers also stand to waste marketing dollars and irritate potential customers by repeatedly delivering the same ad to the same Internet user.
According to Mr. Peterson, the increase in cookie deletion can largely be attributed to consumers associating what he calls "harmless little text files" with spyware and the invasion of their privacy on-line.
"The attitude is there is something wrong with [cookies], when really they are benign," he says.
Jeff Fox, senior project editor with Consumer Reports Magazine, agrees. "Cookies aren't spybots hanging around people's computers," he says. "They are passive data files. Their only problem is that there's nothing to stop marketers in the future from associating anonymous information with personal information."
The proliferation of anti-spyware is exacerbating the problem for marketers. These programs routinely identify cookies as spyware, prompting users to delete them.
But while the usefulness of cookies may be crumbling, technology providers have already begun developing alternative tracking techniques. In March, United Virtualities (UV), a New York-based digital marketing company, became one of the first to release a substitute.
"It gives you accurate counting of users, impressions and clicks," company founder Mookie Tenembaum says of the Persistent Identification Element (PIE). The technology, which is already being used by UV clients, both restores original cookies and places Macromedia Flash MX files on users' computers that can't be as easily deleted.
"Cookies still work as usual, this is just insurance," Mr. Tenembaum says.
Ad networks such as 24/7 Canada are also working to find an alternative to cookies. Mr. Aber says the organization has upgraded its analytics tool in conjunction with its U.S. counterpart to include proprietary "Visitor Determination Methodology" that ensures more accurate tracking when cookies are deleted.
JupiterResearch analyst Mr. Peterson says that besides making things easier for marketers and research companies, there are spinoff benefits for Web surfers if they stop deleting cookie files. "Cookies are just designed to help marketers make better websites," he maintains.
The Internet marketing industry hopes Internet users will bite.
Cookies are tiny text files exchanged between Web servers and browsers. They're stored as files on an Internet user's computer to anonymously identify the sites where people surf and shop. Lately, however, the effectiveness of cookies is being threatened, and experts say that could have a damaging effect on on-line marketing in general.
A recent study by international research advisory organization JupiterResearch has found that nearly 60 per cent of American Internet users have deleted cookies from their primary computers, with 39 per cent doing so on a monthly basis. According to the report, as more and more people block or delete cookies, it could cause the long-term measurement of consumer Web surfing behaviour to be "severely compromised."
"The effect that this will have on on-line marketers is fairly substantial," says Eric Peterson, a senior analyst with JupiterResearch and author of the report. "People doing affiliate marketing [revenue sharing between site publishers and advertisers], those with long lead times between marketing response and actual purchases, and any site that depends on cookies to identify users over multiple sessions is affected by this problem."
"The more people that delete cookies, and the more frequently that cookies are deleted, the more it will adversely affect campaign performance," echoes Jay Aber, president of ad network 24/7 Canada Inc., which sells advertising on more than 250 Canadian sites, including Lycos and YellowPages.ca. Mr. Aber notes that publishers and advertisers primarily use cookies to accurately measure a campaign's reach and effectiveness, limit the number of times a consumer sees a specific ad, and deliver "targeted" advertising to users based on their surfing habits and preferences.
Among the problems associated with deleting cookies, they say, is that repeat visitors can mistakenly be counted as new ones, skewing site and campaign statistics that marketers rely on to gauge audience reach and return on investment. Advertisers also stand to waste marketing dollars and irritate potential customers by repeatedly delivering the same ad to the same Internet user.
According to Mr. Peterson, the increase in cookie deletion can largely be attributed to consumers associating what he calls "harmless little text files" with spyware and the invasion of their privacy on-line.
"The attitude is there is something wrong with [cookies], when really they are benign," he says.
Jeff Fox, senior project editor with Consumer Reports Magazine, agrees. "Cookies aren't spybots hanging around people's computers," he says. "They are passive data files. Their only problem is that there's nothing to stop marketers in the future from associating anonymous information with personal information."
The proliferation of anti-spyware is exacerbating the problem for marketers. These programs routinely identify cookies as spyware, prompting users to delete them.
But while the usefulness of cookies may be crumbling, technology providers have already begun developing alternative tracking techniques. In March, United Virtualities (UV), a New York-based digital marketing company, became one of the first to release a substitute.
"It gives you accurate counting of users, impressions and clicks," company founder Mookie Tenembaum says of the Persistent Identification Element (PIE). The technology, which is already being used by UV clients, both restores original cookies and places Macromedia Flash MX files on users' computers that can't be as easily deleted.
"Cookies still work as usual, this is just insurance," Mr. Tenembaum says.
Ad networks such as 24/7 Canada are also working to find an alternative to cookies. Mr. Aber says the organization has upgraded its analytics tool in conjunction with its U.S. counterpart to include proprietary "Visitor Determination Methodology" that ensures more accurate tracking when cookies are deleted.
JupiterResearch analyst Mr. Peterson says that besides making things easier for marketers and research companies, there are spinoff benefits for Web surfers if they stop deleting cookie files. "Cookies are just designed to help marketers make better websites," he maintains.
The Internet marketing industry hopes Internet users will bite.
Wednesday, July 20, 2005
Third-Party Cookies Going Stale for E-Tailers
Retailers would be wise to use first-party rather than third-party cookies if they want a more complete view of online visitor behavior, Coremetrics suggests, issuing findings from its LIVEmark Index, a benchmark performance-tracking service. ClickZ reports that the research found anonymous traffic accounts for 13.8 percent of traffic on retail websites using third-party cookies, whereas those that have adapted first-party cookies have an average of 0.6 percent anonymous traffic.
In May, Coremetrics competitor WebTrends released similar findings on third-party cookie deletion and plans to publish updated research.
"We are identifying the top three verticals most affected, one of which is retail," Corey Gault, public relations manager at WebTrends, told ClickZ News, adding that upcoming research would include statistics on sites using first- and third-party cookies simultaneously.
Coremetrics offers a solution for clients to migrate from third- to first-party cookies yet retain older profiles of customers.
In May, Coremetrics competitor WebTrends released similar findings on third-party cookie deletion and plans to publish updated research.
"We are identifying the top three verticals most affected, one of which is retail," Corey Gault, public relations manager at WebTrends, told ClickZ News, adding that upcoming research would include statistics on sites using first- and third-party cookies simultaneously.
Coremetrics offers a solution for clients to migrate from third- to first-party cookies yet retain older profiles of customers.
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