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Permission Marketing: A Response to Do-Not-Call

By Roger W. Risley

How can today’s marketer use permission marketing to reopen the door to consumers who have registered their telephone numbers on the Federal Trade Commission’s (FTC) National Do-Not-Call (DNC) Registry? Perhaps we should start by defining permission marketing. The American Heritage® Dictionary defines permission as the act of permitting or consent, especially formal consent; authorization.

Arguably, the genesis of permission marketing came when Seth Godin, founder of Yoyodyne, the first company to create on-line promotions and direct-mail campaigns, coined the phrase “permission marketing” in 1999. Godin envisioned consumers providing marketers with permission to send them certain types of promotional messages. He saw this as being a way to reduce clutter for the consumer while improving targeting precision for marketers.

What Godin couldn’t have foreseen was how the concept of permission marketing could be used to re-open the door to consumers who had placed their phone numbers on the FTC’s National DNC Registry. So, our definition of permission marketing is thus expanded to be marketing centered on obtaining customer consent to receive a phone call (or an e-mail, fax, or text message) from a company.

Defining the Problem: Consumer response to the FTC’s amending of The Telephone Sales Rule (TSR) and the implementation of the National DNC Registry in 2003 was overwhelming. Since its implementation, consumers have placed more than ninety-two (92) million phone numbers on the registry. Sure, one might question the integrity of the data, as it contains the phone numbers of small and home-based businesses, cell phones, and disconnected numbers. However, if you’re a responsible marketer, then you can’t argue with the fact that the American consumer was just itching for a way to stop telemarketers from bothering them at home.

According to a 2003 Direct Marketing Association Telemarketing Survey:

  • 32% of American adults made a purchase via an outbound solicitation

  • The average purchase was $135

  • In total more than $9 billion was spent

According to the DMA’s 2004 Response Rate Report, telemarketing has the highest response rate, return on investment, and revenue generated per contact of the twelve direct marketing disciplines included in the study. There’s no doubt that telemarketing works, yet more companies than ever are uncomfortable continuing to utilize it to market their products and services due to the National and State DNC Registries.

Why has there been such an overwhelming response to the National DNC Registry and State DNC Registries? Why is there a perception that consumers only get called at dinner time? (I’ve always found this interesting because, in a very unscientific survey I’ve conducted countless times among friends and colleagues, none of them eat dinner at the same time.)  Certainly part of the backlash can be attributed to the overwhelming number of calls consumers receive. When I worked for a large direct marketing company in the 1980s, it was determined that one of our large bank clients was calling its credit card customers once every seven days to sell them a variety of products that had nothing to do with their credit cards. Yet, this same bank couldn’t understand why these customers were unresponsive and, in some cases, angry every time they received a call on behalf of this institution. This is the “carpet bombing” telemarketing technique. The thinking is to take a list, put it on a dialer and call and call and call. It is this approach that has, in part,  led to the overwhelming consumer response to the National and State DNC Registries.

Introducing a Solution: So how can permission marketing enable smart marketers to once again use the telephone as an effective sales channel? The FTC’s National DNC regulations currently allow a marketer to continue calling a consumer under their Existing Business Relationship (EBR) exemptions. These EBR exemptions are defined by the FTC as:

“A company with which a consumer has an established business relationship may call for up to 18 months after the consumer’s last purchase or last delivery, or last payment, unless the consumer asks the company not to call again. In that case, the company must honor the request not to call. If the company calls again, it may be subject to a fine of up to $11,000.

“If a consumer makes an inquiry or submits an application to a company, the company can call for three months. Once again, if the consumer makes a specific request to that company not to call, the company may not call, even if it has an established business relationship with the consumer.

“A consumer whose number is not on the national registry can still prohibit individual telemarketers from calling by asking to be put on the company’s own do not call list.”

But what do you do if the consumer you want to call falls outside of the EBR definition and they’re on the National DNC Registry? The FTC’s TSR has an additional exemption they’ve identified as “The Written Permission to Call Exemption.”  This exemption states:

“The TSR allows sellers and telemarketers to call any consumer who gives his or her express agreement to receive calls; even if the consumer’s number is in the National Do Not Call Registry. The consumer must give express agreement in writing to receive calls placed by – or on behalf of – the seller, including the number to which calls may be made, and the consumer’s signature.

“The signature may be a valid electronic signature, if the agreement is reached online.

If a seller seeks a consumer’s permission to call, the request must be clear and conspicuous, and the consumer’s assent must be affirmative. If the request is made in writing, it cannot be hidden; printed in small, pale, or non-contrasting type; hidden on the back or bottom of the document; or buried in unrelated information where a person would not expect to find such a request. A consumer must provide consent affirmatively, such as by checking a box. For example, a consumer responding to an email request for permission to call would not be deemed to have provided such permission if the ’Please call me’ button was pre-checked as a default.”

Securing written consent: So how do you go about securing this “written consent?”  This is where a marketer can leverage permission marketing. Utilizing more traditional direct marketing channels, such as mail, post card mailings, take ones, or business reply cards, a marketer can simply asks the consumer for permission to call them. As effective marketers, we know that the response to any of these methods could be questionable. What if we could “spice up” a traditional mail piece to make it more exciting, providing the consumer with an incentive to respond with their permission to call them? The mailing would have to be highly targeted. It would have to contain an offer that was not available elsewhere. And, it would have to be unique.

Picture this: a large auto insurer knows that consumers have an opportunity to change their auto insurance provider every six months. They want to target consumers on the National DNC to ask their permission to call them every six months to see if they’d like to switch auto insurance carriers. The mail piece would contain a compact disc, on which would be some unique content that would appeal to the target audience – for example, the forms a consumer would need if they were to get into an accident. Or perhaps an atlas of the United States, maps and information on National parks. The idea is to have content that would be interesting or of use to the consumer so that, upon receipt, they’d place the CD-ROM in their computer.

Once the CD-ROM is inserted into the computer, the disc auto loads. In order to “unlock” the content, the prospect would be lead through a process where it is clearly explained that the insurance company would like to call them a limited number of times per year to check on their auto insurance needs. The prospect would answer specific questions that, when answered, would constitute their electronic signature. This information would be kept on a secure database. The contents on the disc would be available to the consumer, whether or not they gave their permission for future calls. If permission was obtained, even though this person is on the National or any State DNC Registry, this specific auto insurance company would be able to call them. A marketer could even use this concept to increase activity to a web site and/or make a sale on the spot.

This concept of permission marketing could be used by any company that has reduced or eliminated their use of telemarketing as an effective sales channel due to the National DNC Registry. Just think of it. A company could ask the consumer whether or not it could call them. The marketer could even ask what specific days and times the prospect would prefer to be contacted. A consumer that opts in to a call is certainly more likely to respond to future offers from a company that practices permission marketing. And, they’re likely to be a more long term customer with a higher lifetime value. What more could you ask for?

Read other articles and learn more about Roger W. Risley.

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