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Is Rapleaf Getting a Bum Rap?

  |  October 29, 2010   |  Comments

A profile of a company that profiles consumers.

Is Rapleaf getting a bad rap over its consumer profiling techniques? Are services that collect online consumer data getting treated more harshly than those that aggregate "offline" consumer information?

I posed those questions to a half-dozen marketers after the Wall Street Journal examined Rapleaf's profiling techniques.

"We evaluated Rapleaf for one of our larger clients - but didn't hire them," Andrea Fishman, VP, global strategy and a partner at BGT's Chicago office, wrote in an e-mail interview with me. "Their big differentiator is that they tie names and email addresses to online behavior. This allows them to build richer profiles, leveraging both online and offline data...They claim that they never share PII [personally identifiable information] with advertisers, but some sources are questioning the veracity of that claim."

Some marketers dodged my calls and e-mails and others spoke on background only. Consider these responses to my queries:

  • "It's a difficult topic. No one wants to be in that story," said one marketer.
  • "I try not to comment on companies in the reputation management space - I try not to poop where I eat," explained another.

Another marketer describes Rapleaf's offensive activity this way: It took potentially personally identifiable information - Facebook and MySpace IDs - appended them to e-mail addresses, and then shared that information with other companies. That becomes more of an issue when matched with shopping data or other offline activities. "Basically it's a key that undoes what's supposed to be anonymous," the marketer said.

Rapleaf CEO Auren Hoffman, in his company's blog, admitted the company transmitted "referrer URLs" from Facebook to ad networks, but has since stopped that practice. It now strips out identifying information in the URLs.

Too Much Information?

Now that it's stopped that offending practice, can the San Francisco-based Rapleaf turn around its image and win over marketers?

An e-mail marketer, who asked not to be identified, said the practice known as "reverse appending" - adding profile information to an existing e-mail address - is considered acceptable up to a point. "There has to be a limit. How much do they really need to know about me? Do they need to know my annual income?"

In August, Rapleaf's Jeff Richman, in a pitch to the e-mail marketer, disclosed the extent of information that Rapleaf is aggregating. In an e-mail dated Aug. 17, he wrote:

Just wanted to let you know that in addition to data from social media, we now have offline data available. Today, some of the offline data fields that can be appended to your customer email/postal database include:
  • Household data – income, marital status, home ownership, presence of children
  • Interests and lifestyles – political affiliation, online bill pay, trades stock, interested in fitness
  • In-market data – Likeliness to buy a house, change cell phone, and buy a car in the next few months

While offline companies have been collecting this kind of information for decades, privacy advocates contend that the marriage with online social information makes these techniques game changers for advertisers and consumers.

Case in point: A presentation, titled "Rapleaf: A New Kind of Information Company" and posted on SlideShare by jrichman2009 five months ago, states that Rapleaf can deliver "high-level and individual data about online fans" and can "mass append" data to customer relationship management systems, including "data about individual customers."

rapleaf-pitch

Not Enough Information?

Consumer privacy is on Rapleaf's radar, but is it committed to it or is it a clever marketing play?

In a July 30 blog post for AdExchanger.com, Rapleaf's CEO argued that cookies that do not include personally identifiable information are safer to use than IP addresses to protect consumer privacy. "From our tests, IP addresses perfectly identify about 30% of U.S. households. That means that from IP address, a site can know your exact address," he wrote.

This attention to privacy comes after an incident three years ago.

Fishman recalled:

"Rapleaf's bad rap started in 2007. One of their products, Upscoop, allowed internet users to find their friends on common social networking services by taking the user's email credentials and looking through their address book. Rapleaf's most noticeable gaffe was when they started sending unsolicited email to all of the contacts that Upscoop had picked up."

Fast forward to today. Rapleaf's home page prominently explains how consumers can stop receiving cookies from Rapleaf or opt out entirely from Rapleaf databases.

While Rapleaf's attempts to educate the public about privacy policies are a step in the right direction, its approach still has shortcomings.

  • Rapleaf asks consumers for an e-mail address to opt out, but the company does not explicitly state what it will do with that address. Consumers should not have to click around a website to read the fine print.
  • Rapleaf is not a member of the Network Advertising Initiative, an organization comprised of more than 60 ad networks, data exchanges, and analytics firms. The NAI created a centralized place for consumers to opt out of receiving behaviorally targeted advertising.
  • Rapleaf enables consumers to log in to see what kind of information it shares with advertisers. However, that information falls into general categories: food and drink, shopping, and Web personalization. Yet, the company apparently maintains profiles that are far more detailed, potentially misleading consumers about the amount of information being aggregated even if it's not personally identifiable.

Here's a sample of what Rapleaf showed me when I logged in:

rapleaf-profile

Yet, consider what data aggregator BlueKai shares many more categories. This is a sample from a longer profile for a ClickZ colleague. (I couldn't find my profile in BlueKai's database):

bluekai-profile

In Rapleaf's Defense

"Rapleaf wants every person to be able to have a meaningful, personalized online experience," reads the company's marketing pitch. And that's an admirable goal. By getting the right ad to the right person at the right time, Rapleaf joins scores of other companies seeking to make marketing more of a science than an art.

"Rapleaf has been at the forefront, technology speaking and publicity wise – which is good and bad," said one former employee. "It's good because they've been at this for a while. They've understood the importance of the social graph, peer-to-peer reputations early on. They have been building against this for a long time. It's bad because of scale they have – they get to be a pretty big target [of criticism]."

And Jason Cormier, co-founder of Room 214, a social media and search marketing agency, finds Rapleaf has helped him set priorities for clients.

"They have done a great job at taking what's been made available [data], and smartly putting it all together," he said in an e-mail interview. "I understand how the data that is actually available to companies might be a rude wake-up call for some...but I wouldn't fault Rapleaf for their strategic thinking around it."

He added: "The social graph is a fundamental piece to social media planning. If you have the ability to legally leverage a customer email list for better determining what social networks your customers are participating in, then you should -- especially if you are trying to make decisions about campaign strategies, tactics to employ first, etc."

Even a critic concurred that Rapleaf has social media data that is the envy of marketers. "If you go to Acxiom, they have shopping behaviors. But no one has a list of who is on Twitter, Facebook," he said, discussing Rapleaf. Hypothetically, a marketer could give Rapleaf the e-mail addresses of its customers and find out their Twitter account names. "You could then engage them to join you on Twitter. That provides real value," he said.

To continue providing value, however, Rapleaf must understand the delicate balance between protecting consumer privacy and helping advertisers deliver relevant advertising.

Addendum

I couldn't help but wonder: when searching for Rapleaf employees on LinkedIn, several disclosed only their first name and the first initial of their last name. Coincidence or not?

rapleaf-employees

Related reading:

WSJ.com: A Web Pioneer Profiles Users by Name by Emily Steele.

GigaOm.com: Rapleaf's Web: How You Are Profiled on the Web by Om Malik

ClickZ.com: Congress Gives Facebook Privacy Homework Extension by Kate Kaye

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ABOUT THE AUTHOR

Anna Maria Virzi

Anna Maria Virzi, ClickZ's executive editor from 2007 until 2012, covered Internet business and technology since 1996. She was on the launch team for Ziff Davis Media's Baseline and also worked at Forbes.com, Web Week, Internet World, and the Connecticut Post.

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