Analysis: Client Profile - DoubleClick watches its cookies crumble - Online advertising giant DoubleClick suffered a media roasting for its plan to link Internet users’ names and their activity on Web sites. It has pledged to make online privacy a

Play a word association game with anyone in the profession on the word DoubleClick - the words ’PR disaster’ won’t be far behind. That’s because online privacy issues are the hot new debate in tech circles, and Web advertising network DoubleClick is the media’s favorite new Internet bad boy.

Play a word association game with anyone in the profession on the word DoubleClick - the words ’PR disaster’ won’t be far behind. That’s because online privacy issues are the hot new debate in tech circles, and Web advertising network DoubleClick is the media’s favorite new Internet bad boy.

Play a word association game with anyone in the profession on the

word DoubleClick - the words ’PR disaster’ won’t be far behind. That’s

because online privacy issues are the hot new debate in tech circles,

and Web advertising network DoubleClick is the media’s favorite new

Internet bad boy.



New York-based DoubleClick made headlines in January when it was found

that it planned to tie real names and addresses from its newly acquired

direct marketing firm, Abacus Direct, with its own anonymous database of

around 90 million user profiles.



The news irked Web surfers far and wide, and consumer advocate groups in

Washington, DC charged into the fray. They were concerned about the

extent to which Web surfing habits are tracked without the public’s

knowledge and have prompted the Federal Trade Commission to investigate

such practices across the industry with a view to creating new

legislation.





DoubleClick’s double take



Soon after the debacle, DoubleClick CEO Kevin O’Connor ditched the plan

and made a public apology: ’It is clear ... that I made a mistake by

planning to merge names with anonymous user activity across Web sites in

the absence of government and industry privacy standards.’



But as is the case in any company crisis, there was frantic back-room

maneuvering by the PR team. In DoubleClick’s case, director of public

policy and government affairs Josh Isay and director of communications

Jennifer Blum handled the media firestorm. Blum says O’Connor and

president Kevin Ryan set aside numerous hours to speak to the press

directly about the issue. Blum worked 14-hour days as well as weekends

to accommodate the huge volume of interview requests from the press.



Blum explains that the nature of the story, blending hi-tech and

political issues, made it difficult to manage: ’When it comes to privacy

issues, it moves to policy reporters who don’t have the same depth of

knowledge (as the beat reporters).’ But one DC-based public affairs

executive who did not want to be named says DoubleClick was wholly

unprepared for the media onslaught that occurred: ’They’ve spent

significant time and energy simply trying to change a reputation that

was damaged because they were clueless as to the ramifications.’



When asked what he would have done differently, Isay responds, ’We would

not have moved ahead of the industry like we did.’ Stovin Hayter,

editor-in-chief of Internet marketing magazine Revolution (a sister

publication of PRWeek), says, with perhaps more understanding: ’I think

they misjudged people’s reaction,’ adding, ’DoubleClick quite rightly

felt that what they were doing wasn’t that far removed from what huge

retailers do with loyalty cards.’



Isay, who joined DoubleClick from Chuck Schumer’s victorious New York

Senate campaign, won’t gauge how much the firm’s reputation was damaged:

’That’s for other people to judge.’ Investors have in fact made their

own judgements, sending the stock plummeting as low as dollars 30, well

off its 52-week high of dollars 135.25. But privacy concerns are not the

only factor weighing on the stock - a softening Internet advertising

market has also had an impact.



In an attempt to manage the crisis and win back public confidence,

DoubleClick brought in Weber McGinn for a short period. It also worked

closely with New York-based IR specialists Abernathy MacGregor Group,

and continues to do so.



DoubleClick took several steps to convince the public that privacy was a

paramount concern. The company established a privacy panel made up of

industry experts to help guide the firm on sensitive matters. It hired a

chief privacy officer, Jules Polonetsky, a former New York City consumer

affairs commissioner. The firm also launched a Web site,

www.privacychoices.org, to help the public understand privacy issues,

and it is opening itself up to a ’privacy audit’ by

PricewaterhouseCoopers.



Isay emphasizes that educating the public is first and foremost on his

mind. ’I think we have a story to tell and a job of educating reporters

about what we do and what we don’t do. Once we do that, people will

react positively because they’ll know how seriously we take the privacy

issue.’





A dog with no bite?



That is not a view shared by some of the firm’s critics. Privacy

advocate Jason Catlett, president of the consumer group Junkbusters,

scoffs at the idea that an in-house privacy watchdog has any bite: ’He

is paid by the company, I don’t care if he is a former Pope.’ Isay

defends the privacy initiative, mentioning board members such as Lori

Fena, chairman and cofounder of TRUSTe, an independent non-profit

privacy organization.



USA Today reporter Will Rodger has spearheaded much of his newspaper’s

online privacy coverage and covered the DoubleClick story in depth.

Commenting on the privacy board, he says: ’While it has some merit, the

members do not have enough experience or are completely new names.’ Lynn

Burke, a staff writer at Wired News who also covered the debate, says

the privacy board is a good first step, but adds, ’How independent are

their recommendations?



The next step would be to appoint someone like Ralph Nader.’



Catlett feels the biggest mistake the company made was not engaging its

critics at the outset. He says letters to the firm requesting details

about plans for Abacus were ignored. ’The first mistake they made was to

deny the problem,’ he says. ’The second was to treat it as a PR

exercise.



They refused to talk about a future business model for Abacus.’



Of the privacy initiatives, Isay claims the moves were more about good

policy than PR: ’This is not smoke and mirrors.’ Even so, Isay admits

that the firm did not do enough to listen to the concerns of third

parties.



’We meet regularly with consumer groups. It didn’t happen enough and we

recognize that,’ he says.



At least one crisis expert thinks DoubleClick acquitted itself well,

considering that it was treading in uncharted waters. John Scanlon,

director of the crisis communications group at DSFX, says, ’This was

really the first time this issue was raised. They were caught a bit, and

slow to start with, but I think they handled it well.’



Since that fateful week in January, DoubleClick has been in the

unenviable position of watching its stock price yo-yo every time ’online

privacy legislation’ is mentioned. But it looks like the FTC might be

edging nearer to an agreement on a set of voluntary privacy rules with

the Network Advertising Initiative, an industry trade group of which

DoubleClick is a member.



In addition, DoubleClick remains a favorite of Henry Blodget, the

influential Internet analyst at Merrill Lynch.



So what is to be learned from DoubleClick’s story? The DC-based public

affairs pro offers this lesson: ’DoubleClick is a cautionary tale about

the importance of getting your PR staff involved in the early stages of

business decisions.’ It also proves that with the Internet, rational

arguments about double standards don’t always count.





DOUBLECLICK



PR chief: Josh Isay, director of public policy and government

affairs



PR staff: Jennifer Blum, director of corporate communications; Gia

Rokeach, PR manager for DoubleClick Media; Lionel Largaespada, PR

manager for DoubleClick TechSolutions; Josh Nova, PR associate; Amy

Shapiro, director of global communications (UK)



External agencies:



Abernathy MacGregor Group; Weber McGinn (project basis).



Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in

Would you like to post a comment?

Please Sign in or register.