OPINION12 June 2009

Why EU cookie proposal takes the biscuit


Andrew Girdwood, head of search for digital marketing agency Bigmouthmedia, makes the case for why a proposed amendment to an EU directive on privacy and electronic communications poses a threat to the entire digital economy – including marketing, bid management and web analytics.

Only cookies that are strictly necessary in fulfilling the request the visitor had made of the site (such as logging in) will be allowed.

The proposal states:

5 ) Article 5( 3 ) shall be replaced by the following:

3. Member States shall ensure that the storing of information, or the gaining of access to information already stored, in the terminal equipment of a subscriber or user is only allowed on condition that the subscriber or user concerned has given his/her consent, having been provided with clear and comprehensive information, in accordance with Directive 95/46/EC, inter alia about the purposes of the processing. This shall not prevent any technical storage or access for the sole purpose of carrying out the transmission of a communication over an electronic communications network, or as strictly necessary in order for the provider of an information society service explicitly requested by the subscriber or user to provide the service.

A large proportion of digital marketing activities could be seriously affected if the European Union accepts the proposed changes to the law.

Affiliate marketing is one sector that would take a significant hit. Some affiliate networks provide cookie-free alternatives to their tracking technology but the EU proposal is not specific to cookies. Any technical method that stores information or gains access to information already stored would be covered.

The storing of data is necessary to credit an affiliate’s – and an affiliate network’s – involvement in a sale but is not necessary to facilitate the sale. Furthermore, to calculate affiliate commission, sites need to share basket values by access this data from the cookie or tracking device.

If websites are forced to ask visitors whether they would like to accept the affiliate tracking cookie (or alternative) then conversion rates are likely to drop and only a small percentage of visitors are likely to agree. The result would be a catastrophic short fall in reported affiliate revenue.

Equally, search engine bid management would be badly affected. Cookie-based systems – such as those that traffic through a redirect – would also be required to ask user permission before the tracking system can function.

Websites may be forced to run multi-million pound search campaigns without having a detailed understanding of how well the campaign is performing. The alternative would be to try and display an opt-in message that would harm neither conversions nor usability while trying to manage the accuracy of the tracking.

In fact, most modern forms of web analytics would be threatened by the European Union proposal. Web analytics which relied on either cookies or session values would pose a breach of the regulations. Only weblog analytics – which involves the analysis of data not stored on the visitors’ computers – would remain unaffected.

It is possible that the use of session variables in URL parameters would become popular with sites across Europe if the proposal is accepted. The use of sessions may allow more data to be stored and tracked about the visitor without the site being required to leave data on users’ terminals. Sessions, however, are a very real obstacle to search engines. Sites deploying sessions could struggle to be found on Google, Yahoo or Microsoft’s new Bing search engine.

The experience of visiting commercial websites could also be badly affected. Sites may be forced to display a pop-up message – commonly associated with invasive advertising – in order to seek the visitor’s permission before any tracking could be used.

Ultimately, the loss in transactions combined with the cost of implementation would stretch to many millions of Euros in lost revenue each month for online retailers, travel and finance sites.

This article originally appreared on Bigmouthmedia’s digital news service.

1 Comment

15 years ago

"If websites are forced to ask visitors whether they would like to accept the affiliate tracking cookie (or alternative) then conversion rates are likely to drop and only a small percentage of visitors are likely to agree. " Which is an admission that most of the material on websites is of absolutely no interest to visitors... Frankly the heavy bandwidth required by most advertising these days is beginning to render some sites unusable, especially for those on slower (dare I say it, dialup) connections.

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