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Beware the cookie monster

Etailers must actively obtain the consent of site users when setting cookies to avoid a legal bellyache.

Retailers need to be thinking about how a change in regulations regarding the use of cookies will affect all aspects of their online business – from data analysis to online marketing campaigns.

According to guidelines from law firm Marriott Harrison, the change states that “operators of websites setting cookies must now obtain website users’ ‘freely given specific and informed consent’.”

Previously, a user’s acceptance of cookies would default according to their internet browser settings, and would only reject cookies if they had chosen to set their browser up in that way. The new law means users have to actively choose to accept cookies on a website.

However, there is an exception. David Bennett, partner at Marriott Harrison, explains: “Etailers’ ability to make sales should not be affected to a considerable extent, because there is an exception for any cookies that are strictly necessary for the provision of services requested by the website user. For example, consent is not required for cookies to record the contents of a shopping basket. ”

The main issue that will arise from the change affects retailers when looking at data analysis. Analytic systems rely heavily on cookies to collate data and if a large percentage of customers refuse to accept cookies, this data pool will decrease and therefore skew the results.

It could also have a big impact on retailers using behavioural retargeting (targeted advertising to customers based on their previous actions on the web and sites they have visited) as part of marketing campaigns. However, only once this law has come into effect will retailers begin to see the impact it has – if customers are willing to accept cookies readily then it could change very little.

But with the year’s grace nearly up (the change in law came into effect in May 2011) retailers do need to think about what this means for their online proposition and the changes required in order to ensure the site is compliant. 

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