Cookies and Affiliate Programs

As more business owners use affiliate programs on their Web sites to boost sales, they run into the problem of cookies. Many people delete their cookies every day for security reasons. So what happens if your customers or referral partners delete their cookies too? Can an affiliate program work without cookies?

To understand the issue, you should understand something about what cookies are and how they work. A cookie is typically a small chunk of text that is passed between your browser and the Web site you are visiting. The purpose of a cookie is to let the Web site store information about your visits.

By and large, cookies are helpful. If you have ever checked one of those "remember me on this computer" boxes on a Web site log in page, you’ve seen cookies in action. The site uses a cookie to store your login information so it can be retrieved the next time you visit the site.

Of course, therein lies the security risk: anyone who has access to your computer can potentially see what information has been stored in your cookies. That’s why you should never check one of those "remember me" boxes on a public or shared computer.

With that in mind, here are a few other things to consider about cookies:

Cookies may be persistent or temporary. Temporary cookies are stored in memory and are dumped when you close your browser. Persistent cookies are stored on your hard disk, usually with an expiration date.

Cookies are just data. To my knowledge, no virus or malware has ever been introduced to someone’s computer through a cookie, because neither the browser nor the operating system "runs" them. The only risky moment in cookie processing occurs when the browser parses cookie data for storage or transfer to the Web site. That risk is miniscule compared to virtually anything else that can happen to your computer while browsing random sites on the Internet!

Cookies are domain-specific. My Web site can’t read the cookies on your computer that come from another Web site.

Cookies are user-specific. If you log on to a computer using two different user names, each user name has its own set of cookies.

Okay, so now you know more than you ever wanted to know about cookies. To understand how an affiliate program uses cookies, you need to know a bit about how affiliate programs work.

What is an Affiliate Program?

The purpose of an affiliate program is to give sales commissions to reward the partners who refer customers to you. Internet marketing affiliates are the virtual equivalent of the freelance sales person.

Done ethically, giving sales commissions is a time-honored way of compensating representatives for their efforts at finding and referring qualified leads for your products and services.

As with anything sales-related, the use of internet affiliates can have a bad reputation. It has occasionally been associated with spamming, spyware, and other nefarious activities. If you run an affiliate program, it is your job to make sure your affiliates represent you in a manner that is consistent with your business philosophy, because to your ultimate customer, those affiliates DO represent you.

Affiliate Cookies

So what does this have to do with cookies? In a nutshell, virtually all affiliate programs use cookies to keep track of which affiliate referred a particular customer.

You can set up an affiliate program in a number of ways, but one common method is to use a system that is built into your e-commerce or shopping cart software. When affiliates sign up, they are assigned a unique identifier. The affiliate then adds that identifier to the URL of every link they create that navigates to your e-commerce site.

When your e-commerce software finds an affiliate identifier on an incoming URL, it stores that identifier in a cookie. When the visitor checks out, the affiliate is credited with the sale.

Affiliate cookies are typically persistent cookies, their expiration date depending on the policies of the affiliate program. For example, if your affiliates are supposed to get credit for any sales made within 90 days of the referral, the cookie will have a 90-day expiration date.

If the visitor returns to your site within the lifetime of the affiliate cookie, the affiliate gets credited for those sales as well, even if the subsequent visits did not come through one of the links on the affiliate’s Web site.

How the Cookie Crumbles

So what can monkey up the works? Because the affiliate identifier is stored in a cookie, there are a few points of failure from the affiliate’s perspective:

The visitor might delete the cookie. In that case, the original referral is lost and will only be restored if the visitor goes through one of that affiliate partner’s links again.

The visitor might click through the link of another affiliate. In this situation, only the first or the second affiliate will get credit for the sale, depending on the established rules of the affiliate system.

The visitor may use more than one computer. If the visitor makes the original purchase from a desktop computer, but makes subsequent purchases from a laptop, the laptop sales will not be credited.

Now you can see what I meant when I said that an affiliate program can only "sort of" work without cookies. It is possible for the e-commerce system to pass the affiliate identifier around the site on the URL, but that information is generally lost when the browser is closed. To implement any kind of long-term referral policy, you pretty much have to rely on a cookie. Given the points of failure, you could make the argument that affiliate programs only "sort of" work even with cookies!

As a side note, an affiliate program in a sophisticated e-commerce system could store affiliate referrals in a database and only use cookies until the visitors log in. However, most shopping cart software does not require visitors to log in, so it just relies on the cookie.