Cookie targeting is one form of online advertising used by marketers to keep your brand in front of bounced website visitors, even long after they leave your website.
Before we discuss cookie targeting in detail, let’s look at what a website cookie is: it is usually a small text file which is stored on your browser directory or program data subfolders. Internet cookies are created and stored on your browser when you visit a website. Cookies help websites improve user experience by tracking your movements within the site; this is how you can resume an action where you left off, as well as how websites remember your registered login, the email address you voluntarily provided, any themes you may have selected and other preferences. (All About Cookies)
The only information that HTTP cookies contain are the URL of the website that created the cookie, the cookie’s lifetime and a value (usually a randomly generated number). These files cannot be used to reveal the Internet user’s identity or any personally identifiable information.
Cookie Targeting 101
Cookie targeting, also known as behavioral targeting or retargeting, is one of the most widely used methods in online advertising today. Cookies are used to track the user’s activities online, and not just while they are on a particular website; users can be tracked even after you leave the website that created that cookie.
To put it simply, cookie targeting is the process of gathering, correlating and collating a user’s data and creating a single profile for that user. It can be used for advertising purposes on its own or in tandem with other forms of targeting, including geographic, demographic or contextual targeting.
How Cookie Targeting Works
As a website owner, you can place a small, unobtrusive piece of code on your website. This code will be invisible to website visitors and will not affect the site’s performance at all. When a visitor comes to your website, the code will drop a cookie on the user’s browser which will then follow them as they browse the Internet, even after they leave your site. As the user browses the Web, the cookie will notify the advertising network when to serve your ads. This is particularly helpful since the ads will only be served to people who have previously been to your website. The aim of cookie targeting is to re-engage potential customers by placing your brand in front of your bounced traffic, with the goal of regaining their interest and bringing them back to your website and completing an action, whether that is to purchase an item, sign up for a newsletter or fill up a form.
The effectiveness of retargeting hinges on the fact that only people who have shown a previous interest on your brand will be served your ads. This will allow you to focus your advertising spending on relevant audience.
Pitfalls of Cookie Targeting
There are various reports and studies that show many online users and advocacy groups are concerned about privacy issues when it comes to retargeting. One such survey done by the University of Pennsylvania and the Berkeley Center for Law and Technology in October of 2009 has found that more than 60% of adults in the United States reject behavioral advertising.
In fact, there are pending legislations that will severely impact the ability of marketers to offer cookie targeting, thus limiting its effectiveness. One example is the Do Not Track Me Online Act of 2011 which refers to a series of policy proposals that safeguard the right of Internet users to choose whether or not to be tracked by third-party websites.