UK Telecoms Sector Breaking Email Privacy Laws

15th April , 2004

Europe : A new study published by communications specialists Pitney Bowes has revealed that only 66% of top telecoms companies are complying with the EU Directive on Privacy and Electronic Communications, which became law in the UK in December 2003.

The average figure for compliance across all sectors (telecoms, publishing, banking, insurance, retail) is just 52% of top UK companies, meaning that almost half of UK plc (48%) is currently breaking the law.

This Europe-wide legislation, which governs email communications with private individuals, demands that companies only send unsolicited sales messages via email to non-customers if they have actively opted-in to receiving them. In practice, this means that whenever someone’s details are recorded – for instance as part of a money-off promotion or a competition – they must be asked whether they want to receive subsequent sales marketing e-messages from that company or any other third party. The legislation makes it crystal clear that simply offering someone the opportunity to opt-out of receiving unsolicited emails (or indeed pre-ticking an opt-in box) does not comply with the Directive.

The study examined compliance amongst the top 50 companies in each of five main consumer business sectors – Banking, General Insurance, Publishing, Retail and Telecoms. Companies in each sector were tested to see whether they consistently offered non-customers the opportunity to actively opt-in to further marketing emails when their details were recorded as the result of a promotion or enquiry. These promotions appeared either on the company’s own web site, through a partner company’s website, in a third party e-newsletter, or as part of an advertising or direct mail campaign.

Results Summary

Telecoms were the top scorers, with 66% of companies complying with the Directive. This sector has traditionally been extremely active in direct marketing through all channels, and the higher compliance rate is believed to be the result of experience and awareness of data protection and privacy rules generally. However, marketing experience in this industry has been the result of massive customer turnover rates, and therefore an urgent need to keep recruiting new customers. The new legal restrictions on e-marketing have effectively removed a prospecting channel, throwing intense pressure back on more intelligent use of direct mail and other direct marketing techniques. However, it is simply not an option for any telecoms company not to comply with what is a fully fledged legal obligation. Scrutiny and action from the regulator would not merely be unwelcome, but would also tarnish reputation and potentially impact on sales in what is an absolutely cut-throat market. The risk exposure of non-compliance is simply not worth the brand risk.

David Jefferies of Pitney Bowes comments, “Experienced marketing directors have recognised and expected this restriction on e-marketing in Europe. They have put contingency plans and strategies in place that not only ensured immediate compliance from the legislative D-day of December 11th last year, but also developed intelligent offline marketing initiatives (usually direct mail) to fill the gap left by the removal of this marketing channel to prospects. Sadly, these highly prepared professionals are only just in the majority in the sectors we studied. Companies who have not complied are putting their carefully built brands at risk, by putting out the message to consumers that they apparently don’t care about legislation designed to protect their prospective customers’ privacy. This effectively puts them in the category of junk emailers. We would exhort those who have not yet paid full attention to this issue to do so with all speed, before consumer lobby groups (and consumers themselves) blacklist them.”

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