HOW THIS NEW TECHNOLOGY COULD REDUCE YOUR COMPANY'S DEPENDENCY ON BATTERIES

The era of solar power derived from indoor, low-light sources is upon us. 

A small cadre of startups have developed advanced photovoltaic (PV) cells capable of pulling in significant amounts of power from indoor "ambient" light sources, and they're attempting to bring it to the masses. Their advanced cells could allow product designers to take a fresh approach to products that require disposable batteries and eliminate a common pain point: the hassle of replacing disposable batteries. 

Ambient Photonics, which began as a project within the Warner Babcock Institute for Green Energy, itself a subsidiary of the venture firm Cthulhu Ventures, developed a PV technology inspired by the process of photosynthesis in 2019. Since then Ambient, based outside of San Jose, California, has announced several partnerships to create light-powered smart devices, including with E ink, the company responsible for the ePaper technology that powers Amazon's Kindle e-reader.

Ambient and E ink are collaborating to create next-generation electronic shelf labels, essentially tiny screens displaying product and pricing information in retail stores, that can be powered entirely through indoor light. Many stores in Europe are outfitted with these electronic labels, with larger stores responsible for maintaining anything from 30,000 to 50,000 labels. 

"These labels have taken off because they bring the pricing agility you can find online to brick and mortar locations," says Bates Marshall, Ambient's co-founder and CEO "But each is powered by two or three coin batteries that eventually have to be replaced. That's bad for the planet, but it's also a big operating expense." By harnessing power from the store's own lights, Marshall says businesses can fully eliminate that expense. 

"Businesses know that digging coal out of the ground and burning it creates negative externalities, like pollution and acid rain, which is why solar and wind now make up 95 percent of new energy on the grid. As companies come under pressure to go carbon-neutral over the next few years, they'll need to do more to offset their emissions than just buying carbon credits--they'll also need to change their disposable battery usage," Marshall says. "We see our message as two-pronged: We're helping businesses go carbon neutral and we're eliminating the time and money wasted by replacing batteries." 

While Ambient is focused on producing PV cells capable of powering IoT devices without sunlight, Swedish company Exeger, founded in 2009, has its eyes on the consumer electronics market. The company is the developer of Powerfoyle, a proprietary brand of ultra-thin flexible PV cells that can be customized to take any shape. In 2021, Exeger released its first product: Self-charging over-the-ear headphones, in which the PV cell is built into the device's headband.

Exeger in 2022 released a similar pair of headphones in partnership with Adidas and has also teamed up with 3M to develop a self-charging communications headset designed to be used by construction workers or air traffic controllers. Other product collaborations include a light-powered TV remote for the tech conglomerate Phillips.

Among the downsides of the PV technology is that it can pretty much only power devices that would otherwise use disposable batteries. "I'd be happy to sell you a 10 square meter cell to wear on your back," says Jérôme Vernet, vice president of sales at French PV startup Dracula Technologies, "but I don't know how marketable that would be."

6 COMMON PITFALL TO AVOID WHEN LAUNCHING A CUSTOMER-RETENTION STRATEGY

If you run a subscription-based software company, you may want a customer-retention program that delivers renewals on time, with a price upsell, and with happy customers. However, landing all three is easier said than done.

I was sharing a meal recently with a customer success executive talking about customer churn and how they are dealing with new types of issues since taking ownership of customer retention. They discussed challenges with customers' understanding of contracts even after having signed a renewal, and how their goal was to protect revenue at all costs. This is the essence of subscription-based customer retention efforts, protecting your revenue and driving recurring subscriptions.

To protect revenue and keep subscriptions for the long haul, I have outlined six pitfalls to avoid when launching a customer retention strategy:

1. Starting too late

A successful retention playbook starts months before the renewal date. At minimum, your internal research phase should begin 180 to 120 days before the renewal date, so you can be ready to communicate with customers about their renewal 120 to 90 days before it. The variability in these timeframes is based on customer profiles and timelines. For example, large enterprise customers may need longer to route contracts internally, so for them start your process earlier rather than later. 

2. Being too formal

Renewals are formal agreements and require contracts, as I noted above. But the conversations do not have to be formal. A normal cycle of renewal should feel like an ongoing conversation, especially if delivered by your customer-facing team.

I find the most casual renewal conversations happen with the happiest customers. This includes renewals with a price increase because your customers should understand the rising costs of the platform, interest rates, etc. Of course, there will be exceptions that need a more formal discussion: such as an escalation or a customer churn risk.  

3. Not training your team

Assuming your team knows how to negotiate a contract or discuss the logic of a price increase is wrong. Training is essential to any job task or function and is especially important in revenue-generating roles.

In my experience, employees who do not understand the art of negotiation will often give the lowest asking price to or the best terms for the customer and not the company they work for. This comes down to fear of losing the deal, being nervous about confrontation, and other similar reasons. But this can be avoided with training and practice. Some techniques for training on renewals include one-on-one coaching, call shadowing, role-playing, and also employing training tools and courses. There is a solution for every budget.  

4. Failing to have contracts for every renewal 

Contracts are essential tools for professional and practical assurance of renewal. They allow you to keep your revenue protected for the duration of the agreement. However, legal documentation can be time-consuming. Consider designing a Master Service Agreement, which can have simpler renewal amendments executed at each cycle, while maintaining the broader customer agreement.

There is something to note here--if your customers want to exit mid-contract, you can legally keep them on or work on alternative arrangements, such as an early-out settlement. But do not forget to also document any alternatives with a new amendment.  

5. Lacking shared documentation on customer discussions

This sounds simple but is more important than you know. A few of my customer success leadership roles were passed on from my predecessors. However, that did not mean all their information was passed on. On a few occasions, I spoke to customers who had made an arrangement with my predecessor, via email or a phone call, that was not shared broadly.

This lack of information led to a lack of trust and poor communication over the customer's journey with us. People turn over internally and externally, so be sure to document everything so it can be found by future generations. Not only will your internal team benefit from it, but your customers will have past information as well.  

6. Not understanding finance and customer debt

I learned so much about customers in default in more recent experiences that I wish I had known in my early days. Having a baseline understanding of revenue, debt, cash, and what happens when customers default is very important--and often overlooked by non-finance teams.

It is not so easy to lean on collections agencies for all customer debt, and legal battles can be expensive, so ensure you are paid up within 90 days or else take alternative action with your customers. It is OK to say to a customer, without a signed renewal contract, "I will have to pause your service." Even a happy customer should understand there is a business to run behind the product they are using.  

Avoiding these six pitfalls can ensure you have timely, well-priced renewals and informed, content customers who want to stay with you for the long-haul. 

EXPERT OPINION BY PARUL BHANDARI, FOUNDER SOUTH ASIAN SUCCESS, CEO OF CUSTOMERXSUCCESS@PARULLAHOTI

40 YEARS AGO, APPLE GAVE THE WORLD ITS MOST BELOVED PRODUCT. WHY IT STILL MATTERS

 The Mac turns 40. 

On January 22, 1984, Apple ran what is still one of the most iconic commercials of all time. Two days later, it introduced what would become one of the world's most beloved products. It is certainly Apple's.

It's hard to express the extent to which there was a time when the Macintosh was one of the most aspirational and inspirational products there was. There's a reason Steven Levy called it "the computer that changed everything" in his 2000 book, Insanely Great. It really did change everything, both for Apple and for personal computers as a whole. 

Unlike any other personal computer, it included a graphical user interface (GUI), a mouse for navigation, and a built-in display, all of which were revolutionary at the time. It also endeared its users in a way few other consumer products ever have.

So much of Apple's identity today is driven by the iPhone, but for the last 40 years, the Mac has remained the most beloved product Apple ever gave the world. I know that's a big claim. I also know a lot of people reading that will dismiss it as an exaggeration, but I stand behind the idea that the Mac is far more valuable to Apple as a part of its brand than anything else it has ever made.

Look, I know the Mac is no longer the primary driver of Apple's revenue--or even its reputation. For all intents and purposes, most people view Apple as the iPhone company. That's understandable, considering the iPhone might be the single most important consumer tech product ever. It's certainly the most successful.

While the Mac has had a better-than-average run over the past few years, it's still just a fraction of what the iPhone sells. In the last year, it was less than half of what Apple generates in services revenue, and roughly the same as the iPad. Still, it's hard to overstate the importance of the Mac to the existence of Apple as a company, and as a consumer brand.

Look, I know iPhone users love their iPhones, and there are plenty of people who love their AirPods or Apple Watches, but it is not the same. People who use Macs just think differently about their computers. They may be a (relatively) small group of users, but they are disproportionately passionate about using their computers. 

The original Macintosh 128k. The colorful G3 iMac. The playful G4 model version that looked like a Pixar character. The impossibly thin original MacBook Air. These are iconic computers that defined their respective categories, and the people who use them wouldn't trade them for anything...except, maybe, a newer Mac. 

This is especially relevant on the eve of Apple shipping its first new major product category in eight years, Vision Pro. Apple, as a company, is far less beloved than it once was, largely because it has gotten so big because of the iPhone that it's hard not to think it has lost a sense of what people love.

The success of the iPhone has distorted two of its most important relationships--with its customers, and with its developers. Apple used to view its customers almost as partners. It often felt as though Apple saw its mission as making computers its customers could use to make whatever it is they make. 

Now, however, it seems like when you buy an iPhone, the primary objective is to get you to sign up for a cascade of Apple's services. The company even shows you ads, poorly disguised as helpful suggestions, right in the settings app. 

As for developers, Apple seems to have completely lost the plot. Many of Apple's largest developers appear to be sitting out the Vision Pro launch altogether. 

The Mac is still the one platform that Apple continues to allow to remain open. It's open for developers to create interesting and delightful software. Unlike the iPhone, iPad, Watch, and (presumably) Vision Pro, you can install whatever you want on the Mac, from anywhere you want. 

You can use a Mac to make movies, watch YouTube videos, design brochures, edit photos, write novels, or do your homework. Sure, you can do all of those things on a hundred different types of devices, but--for someone who does them on a Mac, it's just better.

Here's an interesting test: Ask someone who has used a Mac for more than 15 years which they would give up if they could keep only one: their iPhone or their Mac. If it were me, I'd keep my Mac. There are plenty of Android phones that would be just fine. I wouldn't love giving up my iPhone, but--if I had to--I could make it work. There is no way I would give up my Mac, however. 

The Mac may no longer be the most important product to Apple's bottom line, but I don't know how anyone could argue it isn't important to its brand. There's a simple lesson, which is that designing products that delight your customers is the single best way to earning their affection and loyalty. Sure, Apple makes a lot of money collecting commissions on apps people install on their iPhone, but there's nothing delightful about that. It's the Mac that remains the most beloved product Apple has ever made.

EXPERT OPINION BY JASON ATEN, TECH COLUMNIST

@JASONATEN

8 CORPORATE TRAPS THAT STARTUPS ALWAYS FALL INTO

Your startup is a real business. It's more than just a side hustle or a passion project. You need to grow it into a big business while maintaining the advantages of being a startup. 

The problem is, the lure of those big-business crutches will always be there.

As a 30-year startup vet, I've reached the point in my career when I get called to come in and fix companies -- high-growth startups and big corporate companies alike. After dozens and dozens of fixes, I've developed some controversial takes.

Here are the top things I have to undo, the statuses I have to un-quo, and the corporate traps that startups keep falling into, from the most tactical to the most strategic.

Oh, and for the record, no judgment here. I've fallen into all of these traps myself, sometimes more than once.

1. Eliminate Your Status Meetings

As innocuous as this take may seem at first glance, it's one I get the most pushback on. And not just any old pushback, but the "you're an idiot" kind of pushback. 

So let me first clarify that I understand the need for everyone in your company to know everything that's going on as soon as anything happens. Information is the lifeblood of success, and I am in total agreement with the desire for that information to flow freely and often through an organization. 

But the status meeting is the crutchiest kind of crutch that ever walked on crutches. 

Here's what happens in almost every corporate environment the world over. Let's say you schedule an hour status meeting on Mondays at 10 am. What will happen is everyone who has responsibility for that status will spend an hour from 9 to 10 am working as hard as they can to create the most convincing visualization of progress possible. Then they will over-explain that visualization from 10 to 11 am. Then, at 11 (or more likely, 12 pm), they will go back to doing whatever they were doing before the status meeting.

Then add up the hourly equivalent of the salary of everyone in the meeting. That's what that theatrical display is costing you.

Instead, foster a transparent culture of accountability and communication throughout your organization and remove the crutch of status meetings. I can write another post about that if you'd like.

2. Stop Creating Roles to Hire Into

You don't need a CTO. You don't need a VP of revenue. You don't need a director of marketing.

I can't tell you how many times I've seen startups completely overhire for a position, because they didn't know they could just ask for what they needed. 

Let's take CTO for example. The title of CTO at a five-person startup -- or a 20-person startup -- is meaningless. If you put out a job requisition for a CTO, and you don't have a technical team of at least 20 people, you're going to attract a bunch of people who just want to lead a technical team of 20 or more people.  

Instead, conduct your search for an exceptional talent who believes in your vision and mission and can grow with you. You'd be shocked at how much money you will save and how much better results you will get when you're honest about what you want.

3. Don't Implement Off-the-Shelf Methodologies

OK, let me put this out on the table. 

I've seen more implementations of the Entrepreneur Operating System over the past few years than I have since I became an entrepreneur, and almost all of them were installed by some kind of certified firm. By the time I get involved with the company, this has usually resulted in a number of spreadsheets that are mostly empty over the most recent six months.

This feels like PMI/PMP all over again with a different name and better marketing. 

But I'd even extend this to methodologies like Agile. For a startup, the risks of over-analysis, over-documentation, lack of clarity, and increased technical debt often far outweigh any reward from getting goals centralized. 

Instead of going all-in on any one prepackaged methodology, just pick the parts you like and make sure you're consistent with them.

4. Quit Siloing Your Teams

Avoiding this seems like common sense, but it often happens as a by-product. A startup will create teams across technology, finance, HR, marketing, sales, and so on, then hire leadership into them, and then let them set their own goals and work to achieve those goals completely independently. 

It's almost a foregone conclusion that creating an independent team is going to result in that team working in a vacuum. Why does it happen? People will talk about the company growing too large to work as a single unit. But in my experience, it almost always happens because the first three traps I talked about have already happened. 

Instead, encourage everyone in your org to reach out to anyone else in your org, whenever and for whatever. Then create rules for when to use email, Slack, Zoom, phone, text, and/or walk over to someone's desk.

5. Spend Money on Tools That Make Progress, Not Track Progress

You know those movies -- Dodgeball comes to mind -- where the owner of a struggling business is getting audited for some reason and they pull out a box of crumpled receipts? 

They kind of have the right idea.

Until your growth makes tracking progress too complex for a spreadsheet or too unique for a free third-party app, spend the money on the tools that will make that growth happen instead.

6. Ignore Outliers

Listen, I know I'm not the first person to tell you this. You don't have to serve or satisfy every customer. You don't have to plan for every use case. You don't have to load every ounce of prevention on your startup's scrawny shoulders. 

You're going to make mistakes, the unforeseen is going to happen, and the unpredictable is waiting around every corner, no matter how prepared you are. Be underprepared and over-energized instead.

7. Never Say the Word Brand

There's a reason why one of the most famous rock bands over the past 30 years is called Foo Fighters. It's because the guy who started the band was working too hard to spend any time thinking about the name.

In a more business-centric vein, I've seen startups spend money on ads that just included their beautiful logo and their catchy slogan. That money might as well have been torn up or burned. 

I get it though. One of the reasons we became entrepreneurs was to make cool stuff. And the desire to make that stuff attractive will always be a part of that. In business, that's brand building. 

But every moment a startup spends thinking about its brand is a moment that startup loses gaining the market share that would make brand-building pay off for it. Instead of playing that game of Catch-22, focus on the value behind the brand and let the brand-building happen on its own.

8. Underindex on Macro Trends

I've lived this. I've asked founders about it. I've polled founders about it. The smaller your startup, the less chance macro shifts and trends will impact your success, in both good and bad ways.

For example, the best time to start a company is in a bad economy. A shaky macroeconomic outlook is usually a recipe for change, for lazy businesses to have nowhere to hide, for incumbents to be disrupted, and for talent to be cheap.

On the other hand, while every company in the world with more than 1,000 employees and $100 million in revenue is bending over backward to shove the square peg of AI into its round holes, I've been recommending forever that startups just ignore AI, unless they're specifically building around it. 

Unless your business is local and the macro trend or shift will go micro, like inflation, the shockwaves that follow -- again, both the good and the bad -- almost always dissipate by the time they reach the startup and small business level. Instead, anticipate how those trends and shifts impact your customers and your competition, and be flexible enough to react.

These aren't golden rules, but rather just what I've learned over the decades. And at some point, your startup will grow large enough to have to take on some of this corporate weight. Just stay out of these traps for as long as you can.

EXPERT OPINION BY JOE PROCOPIO, FOUNDER, TEACHINGSTARTUP.COM@JPROCO

INSTAGRAM AND TIKTOK ARE MAKING ALL BUSINESSES LOOK THE SAME. HERE'S WHY COMPANIES NEED TO ESCAPE THE TYRANNY OF ALGORITHMS

Is social media eroding your company's ability to differentiate itself and win customers?

While platforms such as Instagram and TikTok can be vital for businesses to find audiences and grow, their reach comes with a downside: Companies may feel pressure to tailor their branding to online trends. This can lead to the loss of hard-won visibility if a platform's algorithm changes.

In the new book Filterworld, Kyle Chayka reveals how algorithms created by big tech companies have come to affect every aspect of our lives, from which movies people stream to the kinds of businesses that thrive. Want to drive customers to your coffee shop? Spaces with pendant lamps, raw wood, and sunlit corners look appealing on Google, which might result in more foot traffic. 

The result is a homogenization of design and culture. Everything from store layouts to restaurant dishes is put through what Chayka calls a "physical form of search engine optimization." 

Chayka spoke to Inc. about the pressure small businesses feel to cater to the whims of algorithms--and why he views it as a losing strategy in the end.

You describe a phenomenon you call AirSpace, in which businesses conform to the dominant aesthetics on platforms like Instagram and Airbnb. How did it come about?

I was traveling a lot for work, and I started to notice that in any international city, there was always one kind of generic coffee shop with a minimalist interior, reclaimed wood, Wi-Fi, avocado toast, and latte art. I coined the term AirSpace to refer to the homogeneity of these spaces that were disconnected geographically but were connected by this new geography I was noticing on digital platforms. All of these cafes looked the same because they were following each other on Instagram, copying each other's aesthetics, and following the generic style that ended up being promoted in Instagram's algorithmic feeds. 

Cafe owners, I talked to all felt like they had to market themselves to the Instagram-era consumer. You see the same kind of pressure to adapt to an algorithmic feed in all sorts of businesses. You see it in how hotel rooms are decorated. At a doctor's or dentist's office, you see these very Instagram-friendly, Millennial-coded medical spaces. Businesses are really forced to move through these platforms because that's where consumers are. Algorithmic feeds and recommendations shape so many of [consumers'] financial decisions from what restaurant we order food from to where we rent.

How is this affecting marketing strategies?

The internet has become so overwhelmed by recommendations that you either adapt to them or you can't reach your audience. There's no other option besides paying Instagram to get the word out to your fans. You have to adapt to Google SEO to get discovered online.

A lot of targeted advertising is really bad because it relies too heavily on reaching the people who you think will like your thing. To me, the best way to do it is to use the algorithmic feed to show off what's good about your business or your products, rather than trying to game the system.

Third-party cookies are being phased out. Will that affect targeting?

Algorithmic feeds are based on data surveillance. They all work because these platforms can watch every action we take, everything we click on, or on TikTok, every video that you even pause on for a microsecond. It's beginning to be more difficult to do that. In the book, I argue that this ecosystem should be broken. It's become too overwhelming, too immersive, and too manipulative of the consumer. There's a disgust that happens on the consumer side when something is too optimized for a feed. We're moving out of filterword in part because consumers are tired of how things work, and also because of data protection rules changing.

I think it would be a good thing if businesses would access a little less of their consumers' data. It forces you to find spaces where advertising is more relevant. In the past, we had a lot of human gatekeepers and tastemakers, who often worked through the media. Newsletters have arisen to provide more human connection and I think that's good. But it's difficult: How do we use the scale of the internet but not lose our identity in the process?

Big tech companies change their algorithms all the time. How do companies deal with that?

A big message from social media companies was that if you build a fan base on a platform, you will have access to them. That turned out to be kind of a lie. Instagram, for example, made it much harder to reach all of your followers. In the mid to late 2010s, you could build up a Facebook Group and get really good reach for a while. Then Facebook throttled them and you had to pay for a promotion to those people who had already expressed interest.

There's a lot of pressure to keep up with the algorithm, which really means keeping up with both trends and the formats that are successful on the platform. A lot of the people built their businesses or audiences on Instagram when it was about still photos. Now Instagram is heavily pushing ephemeral stories and videos.

Are there any businesses you discovered that were able to thrive without playing this game?

To me, the best example of this was a coffee shop in Kyoto. Rokuyosha had stayed resolutely the same since 1950. I think that kind of long-term thinking and long-term authenticity is the best route out of the situation we're in.

The problem that we faced in recent years is that everyone pursued scalability over all else because it's so easy: You can target more people, you can spend more on advertising, you can do more e-commerce. There's that temptation of growing really quickly, whereas I think slow sustained growth over a long term is much better for most businesses.

BY JENNIFER CONRAD@JENNIFERCONRAD

3 COMMON PRICE--INCREASE MISTAKES TO AVOID IN 2024

It's January, which means an influx of people at the gym, sweeping declarations for big life changes, and a whole lot of companies sending emails about their prices going up.

While it may feel like a coincidence that these things arrive with each turn of the calendar, there's a psychological reason for it. Wharton professor Katy Milkman and colleagues have dubbed it the Fresh Start Effect. We humans feel compelled to make changes with the new week, month, quarter, or year. This effect also comes into play with milestone birthdays--people are much more likely to run their first 5k or marathon at age 39, 49, or 59 than at 41, 51, or 61.

And while sending gifts at the same time as everyone else is often a bad strategy, great news for everyone who didn't get around to sending gifts this holiday season, blending in with the crowd and raising your prices at a time it is expected can be a great approach.

That being said, you aren't guaranteed to fly under the radar. Plenty of businesses get it wrong and find themselves with upset customers and backpedaling on reasonable price increases. Here are three common price-increase mistakes to avoid at any time of year:

1. Trying to explain why you 'had to' raise prices.

These are all the messages like, "We haven't raised our prices in 12 years, but due to inflation and the rising costs of our vendors..." insert eye-roll here.

While your brain is wired to feel like you need to explain the decision, this makes the communication about you when it should be about your customer. In general, people don't care about you and what you have been struggling with--they care about them. And the longer the communication is before you get to the price increase, the worse it is because that anticipation is making them think "Wow...this must be really bad if they are going to all this trouble..." Your overjustification is more likely to turn people off or make them upset than it is to help you.

• Easy Fix: Make the message about them, not you. What do they care about? What if it wasn't about the price? It is very possible that your customers don't even remember how much they are paying you, so you might be paying a lot of attention to something they aren't focused on. Find ways to showcase your value to them and get them excited about the future.

2. You didn't raise your prices high enough.

Now, I know this one may have you confused, but hear me out. Because raising prices can feel scary, it is common to implement the least possible increase. The problem is this myopic thinking can lead to multiple increases over time, and when those come too close together it can anger customers and make them more likely to leave you.

• Easy Fix: Take the time to plan at least one year out. Is there anything that would make you need to increase your prices again that you should include now? Or does it make sense to delay and align this with new features coming later in the year? In my work, I have found that most people aren't charging enough for their products and services--especially those in small to midsize businesses--so you can probably increase more than you think. And, good news, research shows people value things they pay more for, so be open-minded.

3. Immediately hedge with a discount.

When you're worried about the reaction to a price increase, it is common to offer a discount to offset it. More often than not, I see people use this as a crutch so the discount is more about making them comfortable with the new price than it is about the customer wanting/needing a discount.

• Easy Fix: Get anyone who is selling comfortable with the new price before they have to start saying it to customers. Your confidence is the most important thing when it comes to price integrity. The goal is to be able to say the price like it is the time of day or the weather. Don't jump to discounts to make you feel more comfortable. Instead, try this: imagine you sell water bottles. They are currently $8 each and the price is going up to $12 each. That can feel hard to communicate when your mental anchor is at $8. So, imagine you had to charge 10x more tomorrow. Once you plan through how you could sell them for $80 tomorrow, $12 will feel like a breeze.

If you're wondering, "Should I raise my prices?" the answer is probably "Yes." Now that you know the mistakes to avoid, you can confidently sell at whatever new price you land on. Happy selling!

EXPERT OPINION BY MELINA PALMER, KEYNOTE SPEAKER AND HOST OF 'THE BRAINY BUSINESS' PODCAST@THEBRAINYBIZ

AFTER COOKIES, BUSINESSES WILL NEED TO FIND NEW WAYS TO REACH CUSTOMERS

Love them or hate them, cookies have dominated the online landscape for more than two decades.

The bits of code are stored in browsers and used to track a person's behavior across the web. They enable targeted advertising and allow websites remembering user information from previous visits.

For companies, using cookies to push out targeted advertising can be critical to finding customers online, but they tend to annoy users who may feel their privacy is invaded or grow tired of clicking on website notices to allow cookies, in accordance with new privacy regulations.

But the cookie is beginning to crumble: Google has been discussing moving away from cookies for years, and on January 4 the company began withdrawing support on its Chrome browser for third-party cookies, a process that's expected to take about a year. Apple's Safari and Mozilla's Firefox browsers have already blocked third-party cookies.

In place of cookies, companies are exploring new ways of getting in front of customers. Digital publications that rely on online advertising are also scrambling to understand how the changes will affect their business models.

At this year's Consumer Electronics Show in Las Vegas, one option being discussed is the "doughnut," or a decentralized cookie, Ad Age reports. A company called Futureverse filed a patent for the technology, which allows users to control the information advertisers and other third parties can access. Google is developing its own alternative called Privacy Sandbox, which blocks some tracking and lets users choose what data to share.

Ad Age also wrote that companies are taking a look at immersive Web3 universes and loyalty programs. Another option is diverting advertising dollars to placing ads within apps such as Uber or on websites for retailers such as Walmart, which can leverage those companies' first-party data about customers' location and purchasing habits.

Brands may also turn to influencer marketing, affiliate revenue programs with publishers, and a renewed focus on contacting customers by email or text message.

Cookies were created in 1994 by Lou Montulli, an engineer at the early web browser Netscape. Initially created to allow websites to remember users--critical for features like online shopping carts--but advertisers soon figured out how to develop third-party cookies, essentially a way to track a user across the web.

"If I had known about the 3rd party cookie exploit in 1994 I probably would have entirely disabled 3rd party cookies or scoped them to a combination of the 1st party and 3rd party so that they could not be exploited in the way that they are today," Montulli said in a Reddit AMA.