EU cookie regulation blow to targeted marketing

An amendment to the EU’s ePrivacy Directive could leave online marketers and advertisers without one of their most potent weapons.

On May 25 the amendment will be incorporated into UK law, effectively banning the sending of cookies to consumers, or receiving cookie information without prior consent from the user.

The new rule states: “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 or her consent, having been provided with clear and comprehensive information… about the purposes of the processing.”

That means companies will have to ask anyone using their site for permission to send them cookies. It will also have to be made clear exactly what these cookies do.

The fear is consumers will simply opt out of all cookies. That means companies will lose the ability to track user behaviour online, even on their own sites.

This has marketers like Matthew Barker, managing partner at Hit Riddle, worried. He said: “Measurability is the one of the most important arrows in the web marketer’s quiver.

“For the first time in the history of marketing we can accurately and precisely predict the exact impact of a specific campaign, its outcomes and costs, and report the true return on investment that it brings us.

“Cracking down on the use of tracking cookies in web browsers will have an enormous impact on the way that marketers use the web.

“Everything from web analytics to the behavioural targeting behind online advertising depends upon cookies and the information they are quietly collecting behind the scenes while we browse the web.”

Other online industry officials fear the need for prior consent will lead to huge numbers of annoying pop-ups, all vying to get users’ approval.

This has led the Department of Culture, Media and Sport to team up with browser manufacturers in an attempt to improve browser cookie settings.

If their work is successful, the prior consent problem may become a non-issue, but privacy advocate groups like The Article 29 Working Party disagree with the browser solution.

It believes, for privacy to be properly protected, browsers will have to automatically reject third party cookies. That is unlikely because they are one of the mainstays of the advertising and marketing industry.

Barker is hoping this stand off will help usher in a compromise between marketers and consumers. He said: “Although this represents a big change in the way data is collected, I don’t think marketers and online publishers should be too concerned.

“This is all part of an ongoing and legitimate backlash against the industry’s traditionally closed approach to user information.

“Once the dust has settled and new, more transparent systems are in place, I hope some of the trust will be restored and our industry will start to move away from a reputation that has been tainted by breaches of privacy, spam and other dirty tricks.”

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