Factors Affecting Privacy, Web Marketing
As published in

If you're active on the Web, you may or may not be aware that the location of "where you've been" and "what you've done" can be stored and accessed from your hard drive -- without your knowledge or permission.

The increased awareness and press over this browser feature, referred to innocently as the "cookie," has influenced Internet software publishers to make significant modifications to their products.

For those of you unfamiliar with the term, the file cookies.txt, typically found in the browser directory, allows information to be read from or written to an individual's hard drive. Information such as which sites you visit and the activities performed (e. g., keywords used during searches, type of products ordered) can be stored and accessed by those sites that choose to use this technology.

I recently received an e-mail from an individual who had discovered and analyzed the cookie file on his hard drive. He commented:

"As you mentioned, cookies are a way for web-site providers to store information about their users. I found some cookies in my cookies.txt file, too. The information stored there is really not what I want stored about me: last visit, large numbers, advertising numbers, etc. Especially the large numbers, which I guess is something like a customer number, which could be very dangerous. By use of this number as a pointer to a database entry, all requests, such as searched words, can be used to create a precise profile."

In an e-mail sent to a company which manipulated his cookie file, he wrote, "From our point of view, it would be OK to store information, if the user agrees to that."

Cookies are also used by the Web-based advertising programs which deliver banner ads based on the actions and preferences of the individual.

In this type of Web advertising model, targeting is performed by "looking over the user's shoulder," in many cases without their knowledge.

Of course, access to a wealth of knowledge about a prospect or customer is very enticing to marketers.

However, if the information is acquired without the individual's knowledge or participation, its usage becomes more than questionable.

In addition to the privacy invasion, there's another inherent problem with using cookies for targeted advertising, which is evident if there are multiple users sharing one PC system. Think about the use of a singular PC in a home/family setting. The parent might regularly frequent financial and investment-related sites, whereas the children might frequent sites based on their favorite Saturday morning cartoons.

It's very easy for the cookie file to be convoluted with incorrect demographic and psychographic data based on the sites visited and the actions taken by multiple users of a single machine. In addition, a banner ad could be served that's inappropriate for a particular family member.

Heralded as a milestone event in the realm of cyberspace, the next versions of Netscape Navigator and Microsoft Internet Explorer will allow users to disarm the cookie file. This is an extremely important step in privacy protection, while also being a significant factor affecting how companies market on the Web.

With the cookie feature disarmed, site targeting based on testing a media plan of sites using measured impressions and click-through rates will be the methodology of choice by Web marketers. This methodology isn't bound or driven by the cookie file. Instead, it's guided by a testing and measuring cycle which is responsible and respects an individual's privacy.

Under this system, marketers can assess the demographics and psychographics of a site's visitors based on the content, products or services offered by that site (i.e., a site selling children's educational software is most likely visited by parents with children). This straightforward thinking drives the selection of Web sites and easily integrates into a company's overall marketing efforts.

The user's ability to disable the cookie file marks a significant improvement in online privacy while influencing sweeping changes in Web-based marketing. It's definitely a step in the right direction that benefits both users and Internet marketers alike.