‘Member get member’ email marketing campaigns are very popular, but uncertainty abounds on how to ensure they comply with codes and laws. After months of debate, the CAP Code custodian has issued a new Help Note. Has it brought forth a mouse and is other guidance out there?
Topic: Email marketing
Who: The Committee of Advertising Practice
Where: High Holborn, London
When: February 2006
The Committee of Advertising Practice ("CAP"), the sister body to the Advertising Standards Authority ("ASA") that writes the "CAP" Code of Advertising, Sales Promotion and Direct Marketing, issued a "|Help Note on advertising virals".
The Help Note starts by explaining for us that advertising virals are "e-mail, text or other non-broadcast marketing messages that are designed to stimulate significant circulation by recipients to generate commercial or reputational benefit to the advertiser from the consequential publicity".
Usually, it goes on, they are put into circulation ("seeded") by the advertiser with a request, either explicit or implicit, for the message to be forwarded to others.
Sometimes the messages include a video clip or a link to website material or are part of a sales promotion campaign.
Outside the Code if forwarded by a consumer?
The Help Note goes on to confirm that ordinarily such marketing is governed by the CAP Code. It also underlines that just because viral e-mail is forwarded by one consumer to another, it does not take it out of the Code, nor would an e-mail be acceptable simply because a consumer visiting a website has forwarded a message from that website to the consumer's friend.
There may be cases, the Help Note states, where the communication in question is not marketing at all and may be better classified as "editorial." In cases where the ASA is in doubt, CAP tells us that the matter will be referred to the General Media Panel for its advice and recommendation, with the ASA Council the final arbiter.
Relevant laws reminder
The Help Note then goes on to remind us of the general laws that are applied to viral marketing communications including:
- the Electronic Commerce (EC Directive) Regulations 2002 which require, for instance, that for unsolicited commercial e-mail of all kinds the commercial nature of the message must be apparent forthwith on receipt,
- the Privacy and Electronic Communications (EC Directive) Regulations 2003 ("the 2003 Regulations") which impose an "opt-in" regime with exceptions only for e-mails to corporate subscribers and the "soft opt-in" exception for customers and those who have negotiated to buy, and
- the Communications Act 2003 which prohibits persistent abuse of telecoms systems.
And that's it in terms of the Help Note's content, but it might have also referred us to Guidance published by the Information Commissioner's Office ("ICO") on the 2003 Regulations. This includes a section on "viral marketing".
The section distinguishes between:
(a) a marketer asking a person to send the original marketing message to a friend or friends; and
(b) the marketer asking a person to hand back to the marketer their friend's contact details.
In this section we will call the marketer M. "A" will be the third party who supplied his or her friend's e-mail address to M. "B" will be the unsuspecting friend who is about to receive an unsolicited commercial e-mail from M.
In scenario (a), the ICO warns that M is in fact encouraging A to break the law (in other words to send an unsolicited message to an individual subscriber without prior consent) in order to promote M's products. Accordingly, the ICO "strongly advises" M to tell A only to forward e-mails to those they are certain are happy to receive them.
Furthermore, where M incentivises A to forward the message to B, there is an even stronger argument that M is the "instigator" of A sending the message to B and the 2003 Regulations make it clear that the party instigating the message is liable.
Furthermore, A may also be breaking the law in that he or she is allowing his or her telecommunications line to be used to break the law when the message is passed on.
Clearly, whatever the incentive position, there will be no illegality from the point of view of the "opt in" rule, if A has been notified by B, before A forwards the email, that B consents for the time being to receiving unsolicited commercial email from A. The drift of the ICO, however, is that it is likely to be stricter in its demand for proper prior notification by B to A if A is incentivised by M.
Email addresses back to marketer?
In scenario (b), the marketer is sending a message to an e-mail address it has received from a third party. In this scenario M cannot use B's e-mail address, the ICO advises, unless M is satisfied that A has notified M that B consents to receiving such messages from M. This is what is required by the 2003 Regulations.
The ICO therefore advises M to ask A to confirm that he has the consent of B to pass B's details on to M. M should also check that B has not already asked M to suppress B's details for marketing purposes. Finally, the ICO also advises M to tell A that it proposes to let B know how M got B's details. In this context, the ICO tells us that to reveal A's identity would not breach data protection laws.
Why this matters:
The CAP Help Note was described by some of the marketing press as "toughening up" rules for on-line virals. It does no such thing and simply re-states the current position. This is that marketing material on company websites is not caught by the CAP Code, which will only apply to viral ads sent for example as attachments to e-mails.
The CAP position on this has been described as "unworkable" by one leading viral marketer and showing "that they do not understand the nature of on-line viral advertising".
To repeat, however, the CAP Help Note does not change the legal position, which has been in place since December 2003. One also wonders whether the quoted "leading viral marketer" was aware of the ICO guidance on the issue, which viral marketers would do well to bear in mind.