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DoubleClick and Internet
Privacy
Craig Lizotte
Mission Statement
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DoubleClick is your partner in achieving success with digital
marketing—whether you are a web publisher, marketer or
advertising agency. We are a reliable, experienced, innovative
partner who can help you capitalize on the opportunities that digital
media bring, and meet the challenges they present.
If you’re a marketer or agency, our people work to be sure you get
the best return on your advertising dollar. If you’re a web publisher,
they partner with you to increase revenues.
Our integrated products work together to simplify and streamline
your advertising sales, buying, operations and billing. DoubleClick’s
industry-leading reporting systems enable you to stay on top of
campaign performance at all times, across all digital media. It all
combines to let you get on with what you do best.
Company Overview
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DoubleClick was the industry leader in Internet
advertising. They tracked web activity with
cookies on their 1,500 website network, and
placed banner adds on 11,000 sites.
They target advertised users of their website
network by placing cookies on their hard drive
that would monitor browsing behavior.
History
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Kevin O’Conner founded DoubleClick in 1996.
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David Rosenblatt joins the management team in 1997.
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1999 Forester Research projected online advertising to be 33 billion in
2004.
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In 2000 DoubleClick had:
 1,800 employees.
 7,000 customers.
 Offices in 30 countries.
 Market capitalization of 10 billion.
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Stuart Frankel Senior Vice President joins DoubleClick in 2000.
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February 2000 USA Today published, that DoubleClick’s plans to merge with
Abacus.
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DoubleClick partners with goggle in 2007.
Primary Stakeholders
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Government: Congress and Legislation.
Federal Trades Commission (FTC).
Center for Democracy and Technology
(CDT).
TRUSTe
Marketers
Venture Capitalist
Consumers
Management Team
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Kevin Ryan – President
Kevin O’Conner - Founder
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David Rosenblatt - CEO
Management Team
Stephanie Abramson - General Counsel, the head
of legal and privacy related matters for DoubleClick.
Stuart Frankel - Senior Vice President.
Ben Regensburger - President, DoubleClick
International.
Charlie Dickson – CFO
eCommerce Initiative
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Click-stream is the process of collecting, analyzing, and
reporting data such as: order of web pages visited and
mouse clicks visitors make.
The information collected was identified by an ID
number assigned to a cookie on the users computer.
User information would remain anonymous, and not be
linked to personal information unless the user agreed.
(Agreements were broken during their attempt to merge
with Abacus.)
DoubleClick’s Strategy to Merge
with Abacus
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DoubleClick’s strategy was to integrate their database with Abacus’s
offline database. It could then better target internet users by
knowing their buying and browser behavior.
It formed Abacus online.
Websites would identify users by name.
Click-stream information would be combined with personal
information.
Information would be collected by purchases, surveys and drawings.
Users would have the opportunity to opt-out.
Users could choose to receive targeted advertisements.
Information collected would only benefit the consumer.
No intention of selling information to 3rd parties.
Would not ask information about medical, financial or, sexual
browsing or transactions or children’s browsing.
Getting the right ad to the right person at the right time.
Instead of target marketing the computer, they could now target the
individual consumer. Since there can be many users per computer.
Abacus
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Abacus was the leader in collecting information
from catalog purchases. It had a five year
buying profile of 88 million households.
Abacus collected Personal information such as:
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Name
Address
Phone number
Credit card numbers
Income
Purchases history
Industry and Market
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In 2000 had a market capitalization of $10
Billion.
1st Quarter revenues went up 179% from the
previous quarter at $110 million with a gross
profit of $53 million.
Forester Research predicted that online
advertising would increase from $3.3 Billion in
1999 to $33 Billion in 2004.
Privacy Laws
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The U.S. Constitutions closest privacy law was the Fourth
Amendment, which restricted searches and seizures by
government.
1974 Internet Privacy Act - Restricted information
gathered for one purpose to be used for another
purpose or shared with another government agency.
1988 Video Privacy Protection - Prohibited video
tape service providers from disclosing information about
rentals or request from individuals.
1994 Drivers License Privacy Protection Act Prohibited states from selling deriver’s license
information.
Privacy Laws
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1994 Fair Credit Card Reporting Act - Regulated the
disclosure of credit application data and credit histories.
1994 Electronic Communications Privacy Act - Prohibited
unauthorized access to e-mail, and other statutes prohibited
unauthorized wiretaps.
1999 Financial Services Modernization Act - Limited
disclosure of nonpublic personal information to nonaffiliated third
parties unless disclosure and opt-out requirements were met.
1999 Children’s Online Privacy Protection Act – Prohibited
collecting information from children under 13 unless parents
consent.
The FTC decided they would not regulate internet privacy, so they
established an advisory Committee on Online Access and Security.
Controversy
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Because Abacus has a database with personal
information, the idea of them joining with
DoubleClick was a bad idea because, they
specified in their contract they would not collect
personal information unless the user consented.
There was fear that DoubleClick would link the
databases.
DoubleClick canceled its plan to merge with
Abacus’s database. Now they had to come up
with a strategy to gain pubic confidence back
and remain in business.
Online Advertising
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The internet is free because of online
advertising.
TV, Radio and Newspapers were funded by
advertising.
A pole 70% of people said they were aware.
2/3 said they liked personalized information.
90% said they wanted control of how the
information was used.
TRUSTe
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TRUSTe is a nonprofit organization that certified the
privacy of a website If:
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1) Adoption and implementation of privacy policy.
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2) Notice and disclosure.
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3) Choice and consent.
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4) Date security and quality access to personal
information.
Privacy Concerns
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Because privacy policies could be changed at anytime,
privacy activists became suspicious.
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Companies could violate their policies without detection.
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Click-stream data was invisible to users. Most of them
were not aware they were being tracked, so they didn’t
know they had to opt-out.
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Consumers were tracked over and over without having a
relationship with the company.
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It was ok for Amazon to use this technology because
customers had a relationship with them.
Privacy Concerns
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The Center of Democracy and Technology (CDT)
began to educate Internet users, and encourage
them to write letters to DoubleClick concerning
their policies.
CDT provided an opt-out option on websites
within the network.
Cookies could be turned off in the internet
options on the browser.
Value to the Consumer
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Customizing advertisements based on the
user’s interests.
Cookies would greet the user by name,
customized a personalized page, and
remember their password if specified for
websites such as Amazon and e-mail sites.
Value Capture
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Spend less on advertising.
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More efficient (shot in the dark)
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50%-100% higher then untargeted bulk
advertising.
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If Click-stream combined with Abacus would
increase targeted effectiveness even more.
Business Intelligence
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The analysis from click-stream can be
used to make predictions with business
intelligence applications.
DSIR
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Target marketing was a more efficient way to advertise.
If everyone was doing target marketing, they were
making more money. By not implementing target
marketing strategy would result in fewer sales then
competitors.
Markets change continuously. Market research helps you
stay ahead of competition.
Competitors of sites who used click-stream would use
target marketing and would have the advantage over
competitors not using click-stream.
Competitive Risk
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Privacy Laws
Software that made users anonymous and
masked their ID:
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Webroot.com
TopClick International
Anonymizer.com
Zero-Knowledge
Privacy Preference Protection (P3P) software
plug allowed users to specify what information
they wanted to give.
Missed Opportunities
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Merging with Abacus.
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They could have just sold software to companies such as Amazon so
the company’s could do their own target marketing.
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Double Click’s database was better because there was a larger pool
of data than there would be from individual sites.
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With a larger pool of data, better targeting could be used to users
browsing on competitive sites.
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Sell P3P software.