DoubleClick to Cut 10% in Network Reorganization

Following recent closures of offices in Australia and Brazil, online ad network DoubleClick is laying off 10 percent of its workforce in an effort to reorganize its global networks.

The layoffs accompany a sizable change in the way New York-based DoubleClick does business in its media operation.

In the United States, DoubleClick Media will offer two distinct Networks. One will focus on branded sites, while the other concentrates on larger networks of less-well-known or niche properties, to promote on audience “reach and targeting,” it said.

A single sales force will sell both networks.

Like Phase2Media and Winstar Interactive, which rep sites with well-known brands — rather than focusing on selling remnant inventory across ad networks — DoubleClick said its new “Brand Network” will contain sites that are recognized media brands that have a significant amount of traffic and marketable inventory.

DoubleClick declined to discuss how its new Brand Network differed from its previous “DoubleClick Select” network of bigger-name properties. Those properties it repped on an exclusive basis, and on a site-by-site basis, rather than as a network or channel. At the least, however, the move represents an even further separation of DoubleClick’s well-known sites from the rest.

Sites not in the “DoubleClick Brand Network” will be place into its “Audience Network,” which will continue to aggregate sites in specific vertical categories, similar to the previous “DoubleClick Network.”

However, the Audience Network is reminiscent of the low-cost Sonar Network, which is described in marketing materials as a “reach network” that “combines advanced targeting, optimization and efficiency.” Sonar was launched last January to complement the company’s existing Select and channel-based DoubleClick networks.

A spokesperson for the company declined to say whether Sonar was being rolled into the new product.

Outside of the United States, DoubleClick’s media structure will not change. DoubleClick will continue to offer Networks of local content in each country.

“Given today’s market conditions, we have determined that this strategy is the best way to service our Web publishers as well as advertiser clients,” said DoubleClick global media president Barry Salzman. “Our goal in this realignment is to leverage our media sales force more efficiently as well as improve client service levels with a dedicated senior level team focused on key sites and advertisers.”

DoubleClick said the 10 percent cuts that come as a result of this restructuring will primarily affect its global media business. The firm said it expects to end the second quarter of 2001 with 1,850 employees.

“We are absolutely committed to offering value-added media products to our clients,” continued Salzman. “This new organizational structure gives each media sales person a more complete set of tools to help meet the online marketing objectives of traditional advertisers.”

DoubleClick also said it’s shooting for its Media business to comprise less than 20 percent of the company’s gross profit in 2001; good news during the online ad market’s continued softness, especially relative to its higher-margin technology business.

Wednesday’s news comes following several disappointing announcements from the industry leader. Earlier this month, it closed its Australian office and relocated portions of it to Hong Kong. Prior to that, it shut down its Brazilian media sales unit, which focused on Latin American clients, citing a lack of demand in the region.

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