Editor’s Note: For any questions regarding the law, please contact an attorney.
Email marketing is a good tactic for getting in touch with customers, sharing special deals with them, and notifying them of new products. However, legal issues can arise when you send out marketing emails, particularly in the areas of privacy and anti-spam law.
We will look at what the laws are and how to comply with them, and we will go over some practical tips for staying in line with the laws. We’ll also look at some of the results of this compliance, such as customer confidence and goodwill and protection from fines and penalties.
Marketing Tactics and the Value of Email Marketing
Email marketing is one of the most effective marketing tactics online, with email and search being the top two internet activities. This means that by marketing via email, you are tapping into one of the largest potential target markets online.
Email marketing is measurable: all opens, click-throughs, and conversion rates can be tracked and analyzed. This can help you fine-tune your messages and focus on targeting the highest ROI targets and groups. With such high reach and flexibility, email marketing has significant advantages over other marketing tactics online.
When sending marketing emails, however, there are a number of best practice techniques that you need to comply with to ensure that you don’t irritate your customers or run afoul of regulators. For one thing, you must comply with the relevant laws, so let’s take a look at them.
The Two Legal Issues You Need to Know About
The two main legal issues involved in sending marketing emails are privacy laws and anti-spam laws. Let’s look at privacy first.
To send out a marketing email, you need to collect your customer’s information first. Whether this is online, in-store, or otherwise, you need to comply with privacy legislation when you collect this information.
Most countries around the world have some kind of privacy legislation in place that sets out how you should collect personal information, store it, and protect it. Collecting information to send a marketing email is covered by these laws.
The Laws in the United Kingdom and Europe
The Data Protection Directive establishes that data should not be collected without transparency, legitimate purpose, and proportionality. In practice, transparency and legitimate purpose mean that you should not collect data without customer consent and that you should collect or process the data only for specified explicit and legitimate purposes. For example, you must specify that you are collecting an email address to send out a marketing message.
Proportionality means that you should collect only data that is relevant and adequate for the purpose. In other words, you shouldn’t collect your customer’s phone number if you are going to contact them only by email.
The Data Protection Directive also requires that you keep collected data secure, that you allow your customers access to the data you have collected on them, and that you inform them of who is collecting their data (i.e., your contact information and details).
The Data Protection Act 1998 enshrines these principles in UK law.
The Laws in the United States
The laws in the US are a little different. There is no overarching privacy law for the whole US. The California privacy law is very similar to the European and UK laws; and if you have any US customers online at all, it is likely that some of them will be from California, so you should be sure to comply. California law requires that you disclose:
- The kinds of information gathered
- How the information may be shared with other parties
- The process the customer can follow to review and make changes to the information you have on them
- The policy’s effective date and a description of any changes since then
These laws mean that before you send out marketing emails, you need to collect customer data legally and in line with the privacy principles.
- What information you are collecting
- Why you are collecting it
- What you will use the information for
- How you will keep the information secure
- When you might release the information, and to whom
- How your customers can amend or correct the information you hold on them
- The dispute resolution procedures that are in place if there is a disagreement
Instead, you should use a clickwrap method, where the user has to actually click to agree.
Here’s an example from Timberland:
Now that you have the privacy matters under control, let’s take a look at anti-spam legislation.
The US FTC has an excellent guide to help you comply with anti-spam laws when sending email marketing messages.
The anti-spam law in the US is known as CAN-SPAM. The main requirements of the law are:
- Don’t use false or misleading header information
- Don’t use deceptive subject lines
- Identify the message as an ad
- Tell recipients where you’re located
- Tell recipients how to opt out of receiving future email from you
- Honor opt-out requests promptly
- Monitor what others are doing on your behalf
The anti-spam law in the UK is called the Privacy and Electronic Communications (EC Directive) Regulations 2003. It requires that your email marketing messages (also known as direct marketing) be accurate descriptions of the product or service, legal, honest and truthful, and socially responsible (they should not encourage illegal, unsafe, or anti-social behavior).
The UK law also requires that you must never hide your identity when you send your marketing emails; and if you are marketing on behalf of someone else, you must not hide their identity either.
For most anti-spam law around the world, to market to someone who isn’t already a customer, you must offer them a chance to opt in explicitly. You can do this by including a tick box on your website where they can tick “I want to receive newsletters and sales information.” Here’s an example of what this tick box would look like from Fresh Look Web Design:
UK anti-spam law also includes something called a soft opt-in. This means that in some circumstances, you can treat a customer as if they have consented to receiving marketing emails from you, even though they haven’t actually consented.
However, there are rules that you need to follow to be covered by the soft opt-in exception:
- You need to have obtained the email address “in the course of the sale or negotiations for the sale of a product or service.” This means that the person has to already be a customer.
- You can direct market to these people only with respect to “similar products and services.” So if your customer signed up to receive information on Grand Canyon tours, you can’t send them advertisements for beer. However, if your customer is expecting to receive newsletters about aquarium supplies, they would reasonably expect you to send them newsletters on new breeds of fish available, as this is a similar product.
- The person you are sending your email marketing to must have been given an opportunity to refuse to allow the use of their contact details at the time they were initially provided.
In all marketing emails for both the UK and the US (as well as other countries), you must include an unsubscribe link for your customers.
Here’s what the unsubscribe link should look like in your email:
By making simple changes to your marketing email templates (such as including an unsubscribe link) and ensuring that your message content is truthful and not misleading, you can easily stay compliant with anti-spam laws.
If you comply with privacy and anti-spam laws, and implement their requirements in your email marketing, you will produce big results. You will build customer trust and confidence and show that you put customer wants and needs first.
Also, if you protect customer privacy and allow customers to opt out of marketing emails, you will build goodwill. You will also ensure that your marketing will go to customers who are receptive and open to your messages. You won’t waste time sending emails or messages to customers who don’t want to receive them.
Finally, complying with these laws will protect you financially. The Data Protection Act 1998 in the UK can carry fines of up to £500,000 for serious breaches, and other privacy laws around the world include similar penalties.
Anti-spam law is no different. While the UK’s anti-spam legislation allows fines of up to only £5000, other pieces of legislation are much heftier. Those in breach of Canada’s anti-spam legislation have attracted fines of over $1 million Canadian.
Stay Lawful and Don’t Sweat
Doing these things provides you with great legal protection and builds confidence and goodwill with your customers. Marketing smarter and in line with the law will stand you in good stead for building a trusted and valued business.
About the Author: Leah Hamilton is a qualified Solicitor and writer working at TermsFeed, where businesses can create legal agreements in minutes using the Generator.