The deadline for the EU cookie directive is looming large, and it will potentially have a huge impact on online retailers. Firstly, what is the EU cookie directive? The directive relates how to companies hold personal information of visitors to their site. A cookie enables an online retailer to track and monitor visitors online behaviour when visiting their site. Cookies are a huge benefit to consumers too they make their interaction with frequently-visited sites much easier, and without them online shopping would be much harder, for more information visit the BBC WebWise site.
Some groups and organisations believe cookies are a “Big Brother” tool for businesses to ‘spy’ on consumers. Hence these complaints have helped result in this legislation.
What is the Legislation?
Before this legislation companies could explain their cookie policy in their terms and conditions. But the EU have directed companies to become more transparent with their cookie policy. Hence the legislation is now consumers have to opt in to accepting cookies, hence their permission sought when they visit a website. Ecommerce retailers to drive up adoption of cookie acceptance will need to actively promote the benefits of opting in and ‘promote’ the downsides of opting out. Marketing will be key in the battle to increase the opt-in count. It becomes law on 26th May 2012 when businesses need to comply or prove they are working towards meeting this legislation. For those not complying the maximum fine is £500,000.
The Effects of the Legislation
Analytics will be affected, as the ability to understand how consumers behave and browse on an ecommerce website will become more difficult unless the majority of visitors opt in. This means ecommerce sites will not be able to make fully informed business decisions about their site.
This site firmly believes the legislation is draconian and could cause unintentional harm to the EU economy. When the Eurozone is in a state of flux and all economies are looking for growth, one good news story is the internet economy. For example the UK has the second largest ecommerce economy globally, with revenues in 2011 in excess of £68 billion and its annual growth rate last year was 16%. Ecommerce is not an art but a science, and driving this is analysis of analytics. If businesses cannot accurately track and monitor all traffic to its site (unless all visitors opt in to allowing cookies) then the science becomes unscientific and guesswork and gut feel then take over. With deadline date of 26th May it will be interesting to see how many sites will be ready to adopt this law by then. Computer Weekly have complied a guide and tips on how to comply with this new legislation
Power to the Consumer?
Perhaps the bureaucrats believe this is shifting the power to the consumer? But the consumer is already empowered, they can delete cookies and set their preferences in “Internet Options” which makes all this legislation somewhat redundant? Perhaps they should have engaged with Microsoft, Google, Mozilla and Apple about how their browsers could educate users regards cookies rather than passing expensive legislation.
