February 14, 2005 9:00 PM PST

Firm formerly known as Gator looks for credibility

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players) so that it can more widely distribute new Behaviorlink advertising software, which will monitor people anonymously as they surf the Web in order to deliver personalized ads. The partnerships will help grow its audience from 40 million to 200 million, its stated goal.

That way, it can track a wider swath of the Web population and use the insight to sell more targeted and expensive display ads.

Initially, Claria plans to buy $100 million worth of inexpensive run-of-site ad inventory on publisher pages in the next year, and then resell it as behaviorally targeted promotions. For example, it might buy untargeted ad inventory for $1 per thousand impressions at Yahoo, and then resell it for $8 CPM to advertisers as behaviorally targeted.

This is possible because it can make note of consumers visiting car sites like Ford.com or Autobytel.com, and then deliver a car-related ad to them while they're surfing Yahoo. Consumers who've just been at Nordstrom.com might see a retail-clothing ad while visiting the horoscopes at Yahoo.

Claria said that as much as 85 percent of commerce interests are invisible to Web publishers. And its unique visibility into consumers' interests from the vantage point of the desktop will help many Web sites target ads better, according to Claria.

"Publishers have a lot of untargeted inventory that gets sold at unbelievably low rates if it gets sold at all," said Tom Hespos, president of media buying agency Underscore Marketing. "The way to enhance the value of that inventory is to add a layer of targetability to it. Publishers who let run of site inventory go for a dollar per thousand will be able to plug into BehaviorLink and get more money for the same inventory."

Key to Claria's plan will be to eventually partner with online publishers such as Yahoo or MSN to monitor the overlap of their audiences with its own and share in the revenue lift. Eventually, Claria also plans to improve Web search with the same formula.

Overture Services, a unit of Yahoo, has had a relationship with Claria for more than a year, distributing paid search ads to Claria's adware service. Overture is not ruling out an expansion of their partnership.

"If the Behaviorlink service could improve the Web experience for consumers, we'll consider it carefully," an Overture representative said.

Representatives from the online arms of The New York Times and The Washington Post did not immediately respond to requests for comment.

Last February, 6-year-old Claria moved into the original headquarters of Excite, a Web portal that petered out in the dot-com bust. McFadden, who as one of Excite's first employees picked the space originally, said he was worried about potential bad karma so he had all remnants of Excite colors--red, black and white--stripped from the office. Now it's a roomy, pastel colored work space with exposed ceilings, ping-pong table and "town hall" lunch area. The old company icon--a gator in the form of a stuffed animal--decorates some employee cubicles. The headquarters houses about 150 people, and another 100 people work in satellite offices.

Claria claims more than 1,400 advertisers, with more than 85 that are in the Fortune 1000. Toyota, American Express, Circuit City, Avon and Sony are among the major brands that have used Claria's software to distribute pop-up ads to people as they're visiting rival Web sites.

The company said it made more than $100 million in revenue last year, up 25 percent from 2003. Claria postponed its IPO last summer because the market started to lag and questions over the legality of adware and spyware were still being answered. Congress is attempting to pass legislation regulating the industry this year.

"We want to eventually take Claria the Behaviorlink company public, not Claria the pop-up company," McFadden said.

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6 comments

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My dilemma...
So I'm the CEO of a privately held company which happens to be the *devil*. What should I do next? I know, throw more marketing into it. Yes, 200 million souls I shall bring to my dark place filled with behavioral ads. I'll start them with questions about sexual performance, but promise to keep everything hush hush. Except of course I'll tell the advertisers who to target. I just hope this FireFox thing with AdBlocker doesn't get popular because I'll be back to brewing newt-eye soup all day again.
Posted by sanenazok (3449 comments )
Reply Link Flag
Gator & company
Having been born and raised in Florida all my life, I know for a fact that no matter how you try and tame a gator... they'll still snap at anything that comes there way.

Credibility my gator... (* LOL *)

What credibility?
Posted by wbenton (522 comments )
Reply Link Flag
Still parasitic
Their consumer monitoring is still based on running software on their victims computers, consuming the victims bandwidth and disk storage. That's parasitic behaviour and as long as nearly every web site out there is already selling all the advertising their own site can support any additional advertisements shown by this software are just a nuisance to the user and even parasitical to the web site being visited.

Nothing they've done changes these basic facts.
Posted by Not Bugged (195 comments )
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just a nuisance
<a class="jive-link-external" href="http://www.analogstereo.com/subaru_legacy_owners_manual.htm" target="_newWindow">http://www.analogstereo.com/subaru_legacy_owners_manual.htm</a>
Posted by Ubber geek (325 comments )
Link Flag
Once trash...
Once trash always trash. I would trust them as far as I could throw them. They can keep their cr*p away from me and my computer.

Frankly, I think it is funny that after being one of the top evil ad pushers that they think they can get people to believe that they are now saints.

That is like Microsoft trying to convince the world that the next version of Windows is going to be 100% secure and 100% bug free.

What a joke.

Robert
Posted by (336 comments )
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Who cares?
I don't use thid party tool bars or freeware that isn't certified adware free and I regularly scan my system for adware. Clarion will never be on my system and I'll never see their tailored ads; so let the corporations waste all the money they like on this nonsense! I'll just wait for the fun of seeing clarion being sued again : )
Posted by Michael Grogan (308 comments )
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