Cookie-geddon: The End of Web Analytics?

Posted on 02. Feb, 2012 by in Digital Marketing

As we edge closer to the one year deadline to enforce EU Regulation, we ask: What does this mean for the future of Web Analytics?


Cookie pictures are obligatory when discussing this topic.

Cookies are delicious, there’s no denying it. Whether homemade, shop bought or information storing, I’m all for them. Sadly, an EU directive first introduced in 2009 and passed in May 2011 is beginning to seal the lid on the digital cookie jar around which most of the Web Analytics industry is built.

For those of you that haven’t been paying attention, worry not! Take 2 ½ minutes to educate yourself. Essentially, the new regulation requires website owners to gain explicit permission to store cookies on its visitors machines, unless cookies are deemed “strictly necessary” for the operation of the website. This means prompting the user with a request to begin storing information about them, immediately raising red flags for uninitiated layman.

In a time of increased tension over online privacy issues, the fact is when given the chance to play it safe with no negative consequences, the vast majority of visitors will reject any cookie storage request. The ICO (the body responsible for enforcing the regulation) themselves saw a staggering 90% drop in traffic information after they introduced measures to meet their own guidelines. Embarrassing to say the least.

The ICO opted for a so-called unobtrusive solution to asking for permission where visitors are asked once for permission and remain largely unaffected regardless of their decision. Another option is to be more hard-nosed where users are either constantly pestered with requests until they finally succumb to your demand or are granted access to a barren, stripped down, cookie free alternative to your normal website; tempting them to allow cookies into their lives.

Delicious Data

So what does this mean for our data? Well, if we assume that website owners all follow The ICO’s disastrous example then we could be in trouble. To suddenly lose 90% of measurable insight into customers’ behaviour could have a massively detrimental effect on a websites future performance.

The ICO's less than successful attempt to follow their own guidelines.

As it currently stands, the majority of big name analytics packages (read: Google Analytics, Omniture, WebTrends, Coremetrics) use first party cookies to track the movements of a user as they interact with a website. It’s from this data that analysts can provide advice and interpretation which conveys the performance of the site back to the client’s decision makers. No cookie means no data, and no data means sad analysts.

Of course not everyone is forced to commit data hara-kiri like the ICO. Some websites will be exempt from the regulations if the use of cookies can be deemed “strictly necessary”; however, it seems that this is yet to be accurately defined. Other websites will hopefully take a more thoughtful approach to popping the big question.

LBi’s own Manley has previously spoken about the recommended steps companies should be following to work towards regulatory compliance, including the ways in which websites can go about acquiring the required permission to retain analytics data. Websites are likely to be hit with a choice of either sacrificing analytics data for user experience, or increasing bounce rates while you try to ‘convince’ visitors to hand over their sweet sweet data.

Still, it looks like there are a number of big name websites which are yet to make any attempt to follow the EU regulations, with less than 4 months to go to the deadline. My personal favourite being the website tradesman’s favourite rag, The Sun newspaper, hosting an astonishing 102 3rd party and 11 1st party cookies, and no mention of cookies on the site. Until The ICO can topple these behemoths, the average little guy is likely to go unprosecuted.

Being a selfish Web Analyst with a vicious hunger for data, the impending doom of May 26th – the date new regulations will be enforced – tends to make my cookie crumble. But there are a few reasons why we shouldn’t go updating our CV’s and abandoning ship quite yet.

Dietary Restrictions

Is this panic justified? Back in October 2011 Google announced changes to security settings for signed in users which resulted in a loss of search query data within analytics tools such as Omniture, WebTrends and Google Analytics. Whilst all others were losing their heads at the news the peerless analytics Guru Avinash Kaushik provided his followers with a step by step guide to “analyse the impossible”, proving that a loss of data quality doesn’t always equal a loss of analytical insight.

However, beyond the hope of divine intervention from analytics masters to provide us with future solutions, some companies are starting to provide ‘cookie free’ alternatives for tracking website users. CPX Interactive in the US provides its customers with a form of IP segmentation which scores website users based on 120 demographic variables amongst 5.2 million IP zones. CPX interactive claims that the accuracy gained by using its plug-in has more than three times the potential reach than that of cookie-based platforms.

Likewise, London based Blue Cava recently launched an identification tool which allows their customers to accurately identify and target site users based on the device that they are using, again without the use of cookies. The company claims that device identification has proven itself as one of the best ways that companies can reliably target customers across all devices. However, it’s difficult to say at this stage whether alternative platforms such as these could ever replace the insight provided by cookies.

Currently we’re stuck in limbo. While a variety of solutions to the problem can be found online, it remains to be seen exactly the ways in which web analytics will be affected by these changes. Unfortunately, the general consensus is uncertain, with many believing the law is so unworkable that it can’t conceivably be enforced. In the meantime, website owners would do well to prepare themselves for May 26th, better that than face the maximum £500,000 non-compliance fine.


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