Understanding and interpreting your data becomes all the easier and meaningful if you understand the pieces that make data collection possible. Every action you take on the web is tracked one way or another. The pages you view, the files you download and even demographic and interest data can be recorded. This data is captured through what are called Cookies and Tracking Pixels.
Cookie – It is a small text file with ID tags, that a website installs on your computer’s browser directory or program data subfolders. This file may contain information about the web pages you visited and when, a unique identifier, and if you are authorized to view certain logged in content. Typically a cookie doesn’t have much-identifying information. The website itself stores its own corresponding files and matches your cookie ID to the records on the server. This is useful for knowing whether the user is returning for the second time, how long between visits, and even what advertisements they have clicked into.
Cookies are often indispensable for websites that have huge databases, need logins, have customizable themes, other advanced features.
Cookies usually don’t contain much information except for the URL of the website that created the cookie, the duration of the cookie’s abilities and effects, and a random number. Due to the little amount of information a cookie contains, it usually cannot be used to reveal your identity or personally identifying information.
However, marketing is becoming increasingly sophisticated and cookies in some cases can be aggressively used to create a profile of your surfing habits. Like virtual door keys, cookies unlock a computer’s memory and allow a website to recognize users when they return to a site by opening doors to different content or services. Like a key, a cookie itself does not contain information, but when it is read by a browser it can help a website improve the service delivered.
Session Cookies – Session cookies are created temporarily in your browser’s subfolder while you are visiting a website. Once you leave the site, the session cookie is deleted.
Persistent Cookies – Persistent cookie files remain in your browser’s subfolder and are activated again once you visit the website that created that particular cookie. A persistent cookie remains in the browser’s subfolder for the duration period set within the cookie’s file.
An agency, advertiser, or another third party might decide to track impressions with a tracking pixel. A tracking pixel is simply code inserted into a custom or third-party creative that makes a server call and returns a transparent 1×1 image. These are little 1×1 pixel images that allow you to keep track of how many users visit your website or see your advertisement.
So how would we know that user interacted with our ad, be it through some promotion banner on some other website, or our email campaigns?
When the user opens the email and or clicks on a banner, one of the ways that we will know that the user did so is that he will ask our server to download our little tracking pixel.
So, when an advertiser wants to know how many users see their ad they use a tracking pixel. What they do is embed a small, transparent PNG in their advertisement that the user can’t see but the advertiser can keep track of.
Each time a new person visits the website or opens a mail where the ad is, that user has to download the advertisement, including the 1×1 pixel transparent PNG. Every time a user downloads the image, their computer sends a message to the advertiser’s server saying:
“Hey, send that pixel over to this computer at IP Address 18.104.22.168.”
The server says, “Yes, Sir,” sends the tracking pixel over to that IP Address, and makes a note of the event in its server logs.
At the end of the day (or week, or month), the advertiser looks at their server logs and counts up all the different IP Addresses who requested that tracking pixel; if 10,000 different IP Addresses requested the tracking pixel be sent to them, that means 10,000 people saw the ad.
This is the same technology that allows web analytic services like Google Analytics and Chartbeat to tell how many people visited your site.
Example: You see and click on an ad to buy a movie ticket. The most you click, you’ll receive a cookie downloaded on your device. The cookie will include information about time, where you clicked, what banner was clicked when you clicked it, and so on.
At this point in time, the advertising platform knows that its ad received an impression, was clicked, but it has no record of the sale.
Now, you continue and go on to buy the movie tickets. On the confirmation or check-out page, the website is going to look at the cookie saved on your device, pull the information from it, and send it back to the server through the Conversion or Tracking Pixel and now, the advertising platform will connect the dots indicate a sale for that ad.
Data is the new currency, and it’s the medium of exchange between consumers and marketers.
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