Who: Reactiv Media Limited (“Reactiv”), the Direct Marketing Commission (“DMC”), the Direct Marketing Association (“DMA”)
When: 11 April 2014
Law stated as at: 4 June 2014
Reactiv is a direct marketing company which offers telemarketing and digital marketing services on behalf of other companies. It describes itself as a specialist in lead generation & data monetisation, particularly within the financial and insurance realm, with its marketing communications coming from its in-house call centre in West Yorkshire. However, in the last year Reactiv has come under scrutiny from the industry’s watchdog, the DMC, which oversees compliance with the DMA’s Code of Practice for those businesses which are members.
In October 2013, the DMC adjudicated against Reactiv based on a number of complaints received about its marketing techniques. Calls were made by Reactiv attempting to sell payment protection insurance (PPI) mis-selling claims services.
The evidence suggested that scripts were misleading, with Reactiv referring to itself as a “consumer helpline”, and that calls were made to numbers which were registered with the Telephone Preference Service (“TPS”).
The TPS is a statutory “do not call” list of mobile and landline numbers. Subscribers who do not want their lines to receive unsolicited direct marketing calls (“UDMC”) can register the number with the TPS free of charge.
Direct marketers are prohibited by regulation 21 of the Privacy and Electronic Communications Regulations 2003 (“PCRs”) from making UDMC where either the called line is that of a subscriber who has previously notified the caller that such calls should not be made or the number allocated to that subscriber is listed with TPS.
After investigating, the DMC reminded Reactiv of its obligations under the DMA Code of Practice (which in this context mirror regulation 21 of the PCRs) and requested that the marketer carry out a review of its procedures and provide a full report of actions to be taken to ensure future compliance.
In an ironic failure to live up to its name, Reactiv failed to confirm to the DMC that it would comply with the sanction and no report was forthcoming despite repeated reminders. Consequently, the DMC recommended that the DMA terminate Reactiv’s membership and this is exactly what happened on 11 April 2014.
A statement issued by Julia Porter, chair of the DMA board, was quite frank in assessing Reactiv’s failures, saying:
“Reactiv Media refused our help to ensure they adhere to the law and our code of practice, which is there to protect the consumer and the reputation of the industry. It is for this reason we had to strip the company of its DMA membership.”
Rather pertinently, the chief commissioner of the DMC, George Kidd, commented on a wider responsibility when it comes to businesses outsourcing marketing functions:
“Those who use companies like Reactiv Media to generate leads share a responsibility. They should not be encouraging firms to bend or break rules that are there to make sure the public’s wishes are respected when it comes to telemarketing.”
Why this matters:
The decision to kick Reactiv out of the DMA is a warning for DMA members that if they continually fail to abide by the DMA Code of Practice, particularly without a subsequent willingness to review and change procedural failures, the DMC will not hesitate to recommend removal from the Assocation.