DoubleClick to Buy Protagona for $12.9M

Online advertising/technology provider DoubleClick is
eying new markets in the offline marketing realm with its $12.9 million cash
purchase of Protagona, a UK-based software company.

DoubleClick said it would acquire all outstanding shares of Protagona, which makes marketing automation software tools that help
track the best performing channels deployed in campaigns.

The New York-based DoubleClick said it would pay about 8.4 million pounds
sterling, c. 2.40 pence (or 37 cents) per share, about
a 63 percent premium over Protagona’s Monday closing price.

The Protagona purchase, if approved by shareholders, would position
DoubleClick in the offline marketing world with database products that help planners determine whether call centers or direct mail should be integrated with online campaigns.

“This gets us into new channels, more deeply into direct mail,” said David
Rosenblatt, president of DoubleClick. “This does increase our exposure to
the planning side of the industry. Our products to date have been more
focused on execution,” such as its DART ad serving products and Abacus
Direct analytics products.

By adding technology that helps marketers plan campaigns, DoubleClick is
not only spreading its reach into the “first” step of a campaign, but is
also looking for opportunities in traditional direct marketing channels.

“Our goal is to provide technology at each step in the marketing product,”
Rosenblatt said. “This represents a new capability and a much stronger
presence,” especially in call centers.

As marketing campaigns become more complex in a multi-channel marketing
universe, DoubleClick is apparently staying ahead of the trend to
integrate across more channels, and track each medium’s performance and
response rates.

Rosenblatt said the purchase, which the company expects to close by the
fourth quarter of this year, would complement its ChannelView analytics
products, which help track which campaigns are driving the most customers
to Websites, call centers or retail channels. The ultimate goal is to integrate Protagona’s products into all its ad-serving and measurement products, giving it a three-step range to sell customers: planning, execution and measurement of ad campaigns.

However, the purchase is contingent on shareholders voting not to
approve Protagona’s proposed acquisition of database marketing and
integration company Swetenhams Marketing Services Limited, which was announced in August. (An earlier version of this story incorrectly stated that DoubleClick’s purchase of Protagana was contingent on shareholders’ approval of the Swetenhams acquisition.)

Some of Protagona’s clients include SalomonSmithBarney, LendingTree, Disabled American Veterans and Bertelsmann.

How DoubleClick uses Protagona’s marketing products is sure to keep privacy advocates watching closely. Just last month, DoubleClick settled with state attorneys in a case over how it tracks and targets online consumers. Under the settlement DoubleClick said it would make its online tracking activities transparent by letting consumers see their online profiles. It is developing a “cookie viewer” to do just that.

The investigation of attorneys general followed DoubleClick’s purchase of database marketing company Abacus Direct in 1999. Its plan to merge personally identifiable information from Abacus’s vast consumer database with surfers’ online habits gleaned from the use of “cookies” sparked a privacy uproar and led to an investigation by the Federal Trade Commission. DoubleClick later backed away from its plan and the investigation was dropped.

Rosenblatt said the company is also moving to respond to the demands of
clients who are under pressure to squeeze all the results they can from campaigns amid one of the worst ad recessions in a decade.

Richard Livesey-Haworth, non-executive chairman of
Protagona, said the company was pleased with the offer, “which represents a substantial premium over the current market price and offers shareholders an immediate return on cash in a difficult and uncertain market.”

Updated to correct references to Swetenhams acquisition, Protagona’s client list

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