DoubleClick Decision Has Downside for E-Shoppers

The people at DoubleClick can breathe a bit easier now. With the U.S. Federal Trade Commission laying off after investigating their privacy practices for the past 11 months, the folks at DoubleClick must feel like an elephant just stepped off their chest.

But the pressure hasn't gone away entirely. The infinitely complex and tangled privacy debate that DoubleClick sparked -- and that all of e-commerce has to deal with -- is just now beginning.

In fact, any company interested in harnessing the power of digital customization still has to search out that fine line between privacy invasion and personalization. The DoubleClick case, however, did nothing to nail down exactly where that line is or when it gets crossed -- or even who determines any of that. In other words, the privacy line may be more blurred than ever before.

Tug of War

Boiled down to its essence, the problem is this: Virtually all online shoppers demand privacy. Makes sense.

Of course, at first blush these two desires are not compatible. But that has not proved too daunting for the many companies that have waded into the muck and mire in often ill-fated attempts to figure out just what level of privacy invasion people will withstand in order to get that personalization.

Unfortunately for DoubleClick, many, many people felt the company delved a little too deep into the muck and had done so in stealth mode without giving fair notice.

Never Mind

For its part, DoubleClick backed off from its original plans to use its direct-marketing firm Abacus to integrate its online tracking data with offline information such as individuals' names, addresses and favorite shopping patterns.

That move was driven as much by public outcry as by any meaningful understanding of what consumers want. Along with other prominent companies that engendered similar consumer backlash, including Amazon.com, DoubleClick's self-inflicted public relations debacle will make a brilliant case study in business schools for years to come.

But while it seemed DoubleClick had tackled the privacy/personalization conundrum head-on, in fact the company was dodging the core issues. The public is no closer now to finding an elegant solution to the conflicting desires of consumers than a year ago, when the firestorm of controversy began.

That's because the issue requires not boxing gloves and technological sledge hammers, but more delicate tools like a scalpel or a pair of tweezers, all employed with a deft surgeon's touch. After all, every online consumer is different -- despite all the marketing companies efforts to group and categorize and generalize.

One by One

Yet generalization is exactly what DoubleClick and others rely upon. The company's Personalization Consortium released a study last year showing that 15 percent of online users would be unwilling to share personal data with online marketers if it would improve customer service.

Meanwhile, the study showed that 73 percent liked it when a site remembered basic information about them.

OK, so majority rules. But the minority in this case is not going away quietly. In fact, they perceive the actions of online companies as an affront to their privacy and their free movements on the Web.

So is there a simple solution? Of course not, which is why privacy legislation is again the No. 1 online issue before the U.S. Congress this year: If it were simple, something would have been done long ago.

Easy Does It

The reason it's so complex is that too many interests are involved.

Financial groups want to know exactly what consumers are doing online and use that information to make (more) money. Then there's the growing interest of regulators, and finally the consumers themselves, who run the gamut from willing participants in personalization efforts to defiant defenders of personal privacy.

In the long run, my money is on the consumers.

Unfortunately, the question raised by the DoubleClick ruling is not whether e-commerce will give consumers the privacy they want. Rather, it's about how much e-commerce is willing to give up to make consumers secure and happy.

Until that question is answered, or at least asked seriously, the entire debate will remain stuck in the muck.

What do you think? Let's talk about it.