Can E-Commerce Live Without Cookies?

Sara Peters, Editor in Chief | 9/28/2011 | 15 comments

Sara Peters
This week two US Congressman asked the chairman of the Federal Trade Commission to investigate how "super-cookies" could jeopardize the privacy of American Web users.

Also this week, the Office of the Australian Information Commissioner announced it would investigate whether or not some of Facebook's cookies violated Australian privacy laws. The office is specifically looking into the use of cookies that were installed in users' browsers after they logged out.

Member nations of the European Union are in the process of instituting laws that will limit the use of cookies so that they can only be used during a user's session, never be used to track users' browsing history, and only be used when users grant them explicit permission.

The Enterprise Efficiency community has shown that we, as a group, worry about online privacy -- and specifically worry about the surreptitious use of browser cookies. Cookies are getting a bad name, and not without cause. But can online businesses survive without them?

Cookies are a major part of e-commerce. They're the darling of marketing departments everywhere, because they allow businesses to better identify and target their potential customers. They're used to provide better, more customized services to users. They're used to gathering user data that can then be sold to, or shared with, business partners -- and as we know, the trading of "big data," is now becoming a lucrative business. In fact, one might go so far as to say that they are not only a major part of e-commerce but that they are an essential part of e-commerce.

So how can Website owners adequately protect privacy, maintain regulatory compliance, and retain their users' trust, without dooming their businesses?

Yes, there is, of course, the simple expedient of using an "opt-in" policy instead of the "opt-out" policy. That may make life simpler for Web designers, IT directors, and compliance managers -- but it might drastically up the level of difficulty for marketing directors, CFOs, sales staff, and everyone else directly responsible for increasing revenue.

What experience have you had with opt-in policies -- both as a business representative and as a private citzen? Does your Website use an opt-in policy? If so, how have your users responded? Has it affected your profits, and if so, in a positive or negative way? Do you use an opt-in policy, then give users incentives to willingly provide more personal information? If so, do you have one Web form that asks for the whole kit 'n' caboodle, or do you ask for smaller chunks of data as necessary? How do you make your users aware of your use of Web cookies and/or users' personal data? Do you believe that those methods are efficient?

And most importantly: What can we use as an adequate replacement for the cookie... if in fact such a thing will ever exist?

View Comments: Newest First | Oldest First | Threaded View
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Sara Peters   Can E-Commerce Live Without Cookies?   9/30/2011 2:59:13 PM
Re: Selling cookie info could hurt your customer relationship
@kstaron  I love your analogy about having your name and number scrawled on a bathroom wall. Unfortunately I'm sure that your information has been scrawled all over the place by companies you've never heard of. That was part of what made the ChoicePoint data breach back in 2004 such a scandal. Choicepoint was a data broker. It had enormous amounts of info on many millions of people... but none of us had ever heard of Choicepoint, nor had most of us ever heard the term "data broker."
Hospice_Houngbo   Can E-Commerce Live Without Cookies?   9/29/2011 9:58:54 PM
Re: Cookies Make Shoppers Feel Welcome
"I'm sure a lot users out there may prefer convenience over privacy."

That is righ,t and even not every users are aware of such privacy issues. I don't personally have any problem with cookies as I use to give sensitive information to only trusted websites. 
Ombudsman   Can E-Commerce Live Without Cookies?   9/29/2011 8:00:34 PM
Re: Super Cookies
"I personally don't know how I would still do my job if cookies suddenly ceased to exist."

My heart, needless to say, goes out to you. But if cookies suddenly ceased to exist, then no one would have a competitive advantage, would they?

And I wouldn't keep getting those confounded "Remove Unwanted Hair" emails.

I swear I only visited that Website once!
Taimoor Zubair   Can E-Commerce Live Without Cookies?   9/29/2011 4:00:42 PM
Re: Cookies Make Shoppers Feel Welcome
@Hospice_Houngbo: That's a very interesting point. Sara mentioned that the cookie issue is a dilemma for businesses. I feel there's a trade-off involved there for users as well. In order to protect your privacy, would you be okay to forgo saving of passwords and other customized settings? I'm sure a lot users out there may prefer convenience over privacy.
LuFu   Can E-Commerce Live Without Cookies?   9/29/2011 12:54:52 PM
To be or not to be...
I'm all for "opt-in" over "opti-out" as the modus operandi to protect user privacy. However, using the Internet would become toilsome and tiresome if I had to constantly review a site's policy and make a decision. Probably the default choice for the majority would not to opt-in. Unless companies give you a reason to opti-in, few will do it.
Skr2011   Can E-Commerce Live Without Cookies?   9/29/2011 11:55:43 AM
Re: Consumer Protection Counts
YES we should have the right to opt-out. Agreed.
Steel2179   Can E-Commerce Live Without Cookies?   9/29/2011 11:03:58 AM
Consumer Protection Counts
If my information is going to generate profit then at the very least there should be some level of transparency and an opt-out.  Although the government is trying to protect consumer rights, the pace at which they're trying is pretty slow moving.  However, it can be done.
kstaron   Can E-Commerce Live Without Cookies?   9/29/2011 9:43:36 AM
Selling cookie info could hurt your customer relationship
It's one thing to gather my data if I'm buying something form you. We have a relationship. I want you to serve me better. (Up to a point anyway, so gathering my surfing data on your site seems appripriate.)

However, the information gathered from cookies shouldn't be sold to other companies i don't have a relationship with. I don't want them to know my buying habits. It feels like it's scrawling my private phone number on a bathroom wall. It leads to alot of unwanted attention.

I'm the type of person who will give you one digit off on my phone number or spell my name differently so I can see if you are selling my info to anyone. If you do, I'm not about to buy anything from you again, because you just shattered my trust in our business relationship.

Always ask yourself this question. What you want them to do if it was your information?

Anand   Can E-Commerce Live Without Cookies?   9/29/2011 2:49:40 AM
Re: Cookies Make Shoppers Feel Welcome
I think such activities are violation of user privacy and government has to enforce rules and regulations against such companies/ peoples.

@Gigi I agree with you but how can you user track such cookies ? How can he know if a cookie is harmful or not ?

Anand   Can E-Commerce Live Without Cookies?   9/29/2011 2:37:53 AM
Re : Can E-Commerce Live Without Cookies?
They're used to gathering user data that can then be sold to, or shared with, business partners -- and as we know, the trading of "big data," is now becoming a lucrative business.

@Sara this sounds very familiar to Facebooks policy which gathers data from users and trades with only difference being we never know the nature of cookies that are gathering our data. If given oppurtunity I am not sure how many people would like "Opt-in" policy because every one wants to protect their data.

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