Privacy Issues Continue to Dog Marketers

The Direct Marketing Association (DMA) issued its report today on its Ethics Committee actions for the first quarter of 2006. The Ethics Committee is a self-regulatory body that reviews direct marketing advertising and marketing programs for compliance with governing laws and DMA guidelines. If a marketer does not participate in the review process, the matter is referred to the Federal Trade Commission for enforcement consideration. The DMA reports that it handled 23 in-depth case reviews, and 907 complaints and inquiries from consumers during the first quarter.

The Report makes clear that privacy remains an increasingly important compliance element for direct marketers. Indeed, 4 of the 6 highlighted items related to privacy issues in one fashion or another.

The first item relates to "do not mail" or mail suppression requests. While generally speaking, there is no "do not mail" suppression requirement for snail mail (outside of sweepstakes mailings, adult mailings, and for DMA members scrubbing against the DMA's Mail Preference Service), the DMA is recommending that direct marketers make sure they maintain in-house suppression lists for their prospect mailings. Additionally, marketers should not, upon customer request, transfer customer information to third parties for marketing purposes. Given the growing threat of "do not mail" legislation, marketers should take heed to suppress those who do not wish to receive marketing materials by mail. Interestingly, the DMA noted that it does not want marketers to automatically send opting-out consumers to the DMA's Mail Preference Service.

The second item relates to Internet privacy policies. The DMA adopts the position that privacy policies posted on an Internet web site should indicate whether they apply to online practices only or whether they include offline practices as well. While this position seems simple enough, given the growing integration of online and offline data, expressing this statement accurately can be a real challenge and requires careful consultation with the IT and marketing departments.

The third item is that direct marketers should not use name-removal lists for purposes other suppression of future communications to those persons. Indeed, "do not call" provisions of the Telemarketing Sales Rule expressly prohibit using the "do not call list" for any purpose other than suppression.

The fourth item relates to sending of text messages or placing of marketing calls to cell phones without affirmative consent from consumers. Such solicitations are illegal. However, with the advent of number porting (i.e., moving a landline number to a cell phone and vice-versa), makes this proposition a real challenge. Telemarketers need to make sure that they are utilizing the NeuStar wireless suppression file, which supposedly keeps track of wireless numbers.

The DMA randomly selected ten member companies to certify their continued compliance with DMA's Privacy Promise.

Marketers need to be cognizant of the numerous privacy pitfalls. Marketers must be vigilant in all aspects of data handing to make sure that such actions are consistent not just with the governing law, but what they have represented to the public.

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