Should There Be an Online Version of the National Do Not Call Registry?

While marketers want to use every option at their disposal to reach prospects, some boundaries should be put in place.

Should there be an online version of the National Do Not Call Registry? At first blush, this might seem like a dire proposition for marketers. But, in fact, it would be a good thing.

As marketers, we all are intimately familiar with the National Do Not Call Registry regulated by the Federal Trade Commission. Consumers who do not wish to receive unsolicited telemarketing calls can simply sign up online with the registry. Telemarketers then have 31 days to stop calling the specified number or numbers. Failure to do so and/or selling consumer information to other telemarketing companies can result in severe fines.

In recent years, consumer advocacy groups have worked to create a similar model for online marketers. While these attempts have had mixed results, it appears that advocates' diligence has taken hold with at least a few lawmakers.

As marketers, it seems we would want to use every option at our disposal to reach prospects and discourage any form of regulation. But the fact is that we run the risk of alienating our customers if some boundaries are not put in place.

We need to learn from the do-not-call database for telemarketers. Namely, we can't afford to violate the relationship we have with existing customers by overcommunicating with them and "selling" them to or "buying" them from other companies. And we really can't afford to alienate prospects up front with oversolicitation.

A legislative measure introduced in New York would make it a crime for Web companies to use personal information to market to consumers without their explicit permission. Democratic New York State Assemblyman Richard Brodsky has sponsored a bill that would significantly limit the activities of ad networks -- companies that serve ads on sites they do not own -- with strict data-collection rules. The thrust of the bill focuses on limiting the ability of these types of companies from selling consumers' private data (to other companies that can then solicit them) without their permission. While lawmakers in New York adjourned in June without voting on the bill, the issue is not likely to disappear any time soon. The legislature doesn't start its next term until January, but leaders can still call the group back into session later this year. In addition, Brodsky reportedly said he intends to continue pushing for the bill at any future sessions this year, and that if the law doesn't pass this year, he intends to reintroduce it next January. Similar measures were proposed this year in Connecticut and Massachusetts. The Connecticut bill was not passed, but the one in Massachusetts remains under consideration.

The legislation, in general, would have major ramifications for the likes of Google, Yahoo, AOL and Microsoft, since if the bills actually pass and become law, it would be very difficult for companies that collect online data to modify their systems and processes. As with the National Do Not Call Registry, online surfers could request that companies such as Google or Yahoo remove them from any related solicitations and not share their personal information such as names, phone numbers, addresses or incomes with any other company. This sounds easy in theory, but in reality it's much more difficult. Companies most likely would need to revamp their processes across the board in all 50 states and beyond.

There will also be serious ramifications for the industry if these bills become law. In particular, there will be a major ripple in the online marketing and advertising world. Major corporations have shifted their marketing programs to have a much more pronounced online focus and have made significant investments in Web advertising. What's more, much of the demographic data collected by Web companies such as Google and Yahoo help advertisers make their multibillion dollar decisions.

Why it's needed
Despite that, and despite the fact that it could limit your options as a marketer, this type of legislation does need to take place. There's a fine line between collecting data on customers to best serve them and using or selling that data for your company's gain. There needs to be a distinction made between tracking a customer on your own Web site and tracking that customer across the Web at large.

The best way to understand this is to use a real-world scenario. If you ran a hardware store in the real world, for example, the idea that you could watch the people shopping in your store and choose how to interact with them based on their behaviors would be completely noncontroversial. A customer has been wandering around for half an hour looking confused. Proactively offer to help him. Another person has put paint and paint brushes in her shopping cart. Ask if she might need drop cloths or cleanup supplies. Watching what they're doing and what aisles they're wandering down just seems like obvious good business, benefitting both the customer and the store.

But, as the owner of the hardware store, would you ever follow a customer out of your store and down the street to see where else she goes and what other things she does? Do you have the right to follow that customer out your door to the next three stores she visits to monitor her actions for your own benefit?

The answer, of course, is no. That behavior clearly would be intrusive and could be viewed as stalking, as well as a violation of one's right to privacy.

The analogy holds true in the online world, as well -- tracking a customer within your own virtual storefront is just smart business that benefits everyone involved, but following him around as he travels across the Internet (without his explicit permission) crosses a line.

It's about trust
Companies, then, should not be allowed to "follow" that person, observe his online actions, and share them for the company's own benefit and that of other companies. It violates the trust that has been established as part of the vendor/customer relationship. The proposed legislation would go a long way in preserving that relationship and the privacy of consumers. There needs to be a distinction made between what one does within the confines of one's own property on the Web and what one does more broadly.

By all means, this type of regulation should not be applied to one-site tracking and what a company is doing directly with its customers. However, I encourage all marketers to support bills like the ones being proposed in New York and Connecticut since, in a way, they're helping to preserve the integrity of our profession and can only improve our perception and credibility with consumers.

Reach Steven Woods at steven.woods@eloqua.com

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