Many marketers unprepared as deadline looms for new SMS guidelines
By Chantal Tode
September 26, 2013
Written consent required for SMS marketing
Marketers who do not have prior written consent from consumers to send them marketing messages via SMS will potentially face fines of up to $1,500 per unsolicited message starting Oct. 16 under new guidelines.
The new Telephone Consumer Protection Act guidelines going into effect next month require written, auditable consent for every consumer in a mobile database whereas previously consent could be express, meaning a company had previously done business with an individual. For those marketers not already using written consent for their opt-in programs, the new guidelines will require a significant change in how they structure their programs.
“We did a review of 50 brands and found that they are compliant on the old guidelines, but almost no one is TCPA-compliant, given the new requirements going into affect on October 16,” said Michael Ahearn, vice president of customer development and marketing at Archer USA, San Jose, CA.
“The most important thing is that everyone who has an SMS/MMS program already, the database that they have has to be reviewed and have those members of the mobile database re opt-in,” he said. “The brand needs to capture that written consent from their existing opt-in database.”
The new guidelines impact every new opt-in that a marketer acquires as well as all of the existing names in their databases.
For marketers who have not been collecting written opt-ins previously, this means they need to get their existing database members to re-opt-in to their programs with written proof that the consumer has read and agreed to the TCPA disclaimer terms.
The guidelines are retroactive, meaning that after Oct. 16, if marketers do not have written consent from someone already in their mobile database, they can no longer message that consumer legally.
The guidelines were announced over a year ago, with the deadline for implementation set for next month.
Marketers that do not have the required written consent will be exposed to potential legal action.
With the number of lawsuits on the rise brought by consumers against marketers for potentially illegal messaging, this points to the need for marketers to ensure that their SMS programs meet the new guidelines.
“There has been a significant upswing in the litigation with people chasing brands with class action suits over unlawful communication,” Mr. Ahearn said.
“We have seen TCPA law suits increase 60 percent overall in 2012,” he said. “One large apparel chain and two QSRs have had tens of millions of dollars in fines for non-compliant messaging to consumers on their phones.
“The people you don’t have written consent for, those will basically be illegal messages and they will be liable to fines of anywhere between $500 and $1,500 per message for non-compliant messages. If you’ve got 500,000 people and you multiply that by several hundred dollars per message and you can see where it becomes a very critical issue.”
The required language could span two SMS messages.
To be compliant, marketers need to adjust all of their calls-to-action for their mobile messaging programs so that they include the necessary TCPA language.
The required written signature can be obtained via email, Web site form, text message, telephone key press or voice recording.
To be compliant, marketers need to ensure that consumers read and agree, in writing, to receive marketing text messages from a specific brand to the mobile number provided and that they understand they are not required to provide their consent as a condition of purchasing any goods or services.
This language must be clearly and conspicuously displayed in all calls to action in any media promoting the program as well as in the SMS opt-in flow on the phone and include a request to consumers to reply "Yes" to confirm.
For SMS, it may require marketers to send two separate messages to get all the necessary language in front on of users. For MMS, only one message would be required.
“The actual flow in the SMS or MMS would need to, in most cases, require that language to be there, have the end user see that language, then reply with a ‘Yes’ reply message indicating that they have seen and agreed to the language,” Mr. Ahearn said. “This is an excellent way to record the consent and have it available for audit against the phone number.”
Non-marketing messages such as flight updates and bank balances are excluded from the guidelines.
Also excluded are one-time transactions such as texting a keyword to a common short code to receive a coupon, which is delivered via a code in the responding SMS message, with no further messages sent.
Archer and other companies also offer mobile audit and compliance services to help marketers stay on top of the growing requirements in the SMS marketing area.
The impact of the new guidelines is mitigated by the fact that CTIA regulations already cover prior express written consent, which many marketers already follow.
“Any legitimate marketer already gathers express written consent before engaging a consumer with text messages,” said Greg Hoy, vice president of product management at Hipcricket, Kirkland, WA.
“Some smaller companies, or less reputable or ‘spammy’ marketing shops, might not know or care about the new rules,” he said.
The challenge with the new regulations for mobile marketers relates to opt-outs, per Mr. Hoy.
“The opt-out requirement is the trickiest new regulation,” Mr. Hoy said. “The language seems to apply to calls. But the TCPA applies to mobile messages as well.
“So does the requirement to post opt-out options apply to each text message?” he said. “Do marketers have to put these opt-out messages at the beginning of every text?
“If so, this limits what marketers can do with text messages. They only have limited space to begin with. Adding an opt-out message to every text further eliminates space.”
Hipcricket is keeping a close eye for guidance from government and industry on this regulation.
For the time being, the company recommends including opt-out wording in at least one message per month for each text-message campaign, per current industry rules.
With SMS marketing an important way to reach mobile users, the new guidelines could help ensure that consumers continue to feel positive about receiving these messages from marketers.
“The TCPA changes further illustrate the need for marketers to remain consumer-focused, protecting privacy laws and adhering to proper messaging tactics,” said Tim Miller, president of Sumotext, Little Rock, AR. “The new rules are another welcome step in regulating the messaging industry and helping to maintain the integrity of the medium, as a whole.
“SMS/MMS remain one of the most important components in a strong mobile strategy, and compliance builds a strong foundation for a successful long-term engagement with consumers,” he said.
Chantal Tode is associate editor on Mobile Marketer, New York
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