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According to HowStuffWorks, “A cookie is just one or more pieces of information stored as text strings on your machine. A Web server sends you a cookie and the browser stores it. The browser then returns the cookie to the server the next time the page is referenced.”
So here’s a visual of the process:
To show the flow even further, I ran a test on Zappos.com. Before the test, I cleared out my cookies. When I went to their site after the purge, these were the initial shopping recommendations on the homepage:
Coincidence? I think not! The cookie picked up my views of the specific glove product pages and then used that information to update their recommendations for me. So that’s how it works, but are internet cookies a Trick or a Treat?
From a user stand point internet cookies can be pretty useful. Not only do they remember what you like and what you’re into, they also allow for personalized ads. They’re a treat for publishers too who can make money on a CPA basis. It’s all about relevancy and here’s a more in depth look of why:
When browsing and shopping online customers tend to be hit with a ton of information and it’s not unusual for a customer to leave the site before completing a purchase. Businesses like Zappos can recover their initial missed sale by capturing data and using it to display ads on publisher/third party sites. Here’s an ad showing on SadandUseless.com because of the cookie I picked up on Zappos.com
Securing repeat business is valuable to any company because it costs more money to sign a new customerthan it does to retain an old one. Just like any type of sale in business, it’s vital to know and understand your customer in order to build your brand presence within your target market. Using cookie-based advertising leaves the impression with the customer that you know them. How well you know them will determine whether your customers coming back for more.
So the other side of the coin is that cookies can be undesirable from a user’s perspective. Since its Halloween I’d like to compare an internet cookie to Chucky from Childs Play. The main premise behind the distaste for internet cookies stems from companies taking our information and data without our permission. There’s usually a something on the policy pages stating that they’ll take your info via cookie, but let’s be honest – any kind of statement is more to protect the advertiser than it is to protect you. What’s next, my ice tea?
Although cookies can be beneficial to a user when browsing, the ads they produce can sometimes be irrelevant or even considered spammy. All of a sudden you don’t want to curl up next to them at night. Have you ever shared a computer with someone else in the household? Well if you do, and you don’t clear your cookies when you’re done browsing then the next person to use your computer will likely be hit with ads that don’t match their interests. This can be a little scary because the next person to use your computer might see an ad that was meant for you. So much for retargeting.They just keep coming…
When used properly, you won’t have to be exposed to ads for special delivery child birth at Bay Care while you’re listening to some Lloyd Banks on Pandora.
Contextual and personalized ads not only show the customer what they are looking for (or what you think they are looking for), they also yield higher conversions for advertisers. From a business perspective, Internet cookies are definitely a money making treat for advertisers. They also add value towards a user’s shopping experience which in turn grows their customer loyalty and relationship with the advertiser. Even though cookies can be a bit annoying to a user, they are easily managed by altering your browser’s privacy settings and are generally accepted as a marketing tool and an underhand tactic to steal our information.