The Federal Trade Commission is a federal governmental organization that was started to police against monopolies, trusts, and other anti-competitive business practices. These policing responsibilities became extremely important during the beginning of the 20th century as the size of scope of industries began to grow rapidly. Since that time, the landscape of American business and technology has changed drastically, and so too has the list of responsibilities of the FTC.
The FTC, after all, is primarily in existence as a way to protect consumers. At the time of its inception, that involved keeping markets competitive and not allowing huge conglomerates to control prices, wages, and distribution without competition. Now, though, new technologies have added to that responsibility. Consumers need to be protected not just from a business becoming too large and powerful, but also from being too deceptive in the age of the internet.
Enter: CAN-SPAM. This legislation, introduced by George Bush in 2003, was created as a response to the newfangled method of e-mail marketing. In fact, CAN-SPAM does not apply to just bulk e-mail. It defines all commercial messages as “any electronic mail message the primary purpose of which is the commercial advertisement or promotion of a commercial product or service”. Also important is the fact that there is no exception made for business-to-business advertising.
How to Know When It Applies
When creating an e-mail marketing campaign, one of the first things you determine should be whether or not CAN-SPAM is applicable. This way, you won’t have to backtrack your way through correcting mistakes that have already been made. Also, the earlier you start thinking about the legislation, the less of a chance there will be a violation that falls through the cracks. (When we talk more specifically about the potential sanctions in a moment, I think you’ll see why it’s never too early to safeguard against this.)
The ultimate determining factor is whether the primary purpose of your e-mail is commercial or transactional in nature. Commercial content promotes a product or service that has not yet been purchased by the recipient, while transactional content refers to an already-agreed upon transaction. So, if your e-mail isn’t referring to some already-established business relationship, make sure your e-mail adheres to all the CAN-SPAM requirements discussed below.
Now, these are fairly rigid interpretations of what promotional e-mails can be. Anyone who’s sent or received these knows that they don’t often fall into those nicely laid out categories. In fact, most promotional e-mails will contain some element of both commercial and transactional content simultaneously. If this is the case, look at your subject line and first paragraph of your e-mail. If the transactional (remember, this means content that’s specifically in reference to a relationship that already exists) isn’t found anywhere in those two areas, it’s best to assume that the government will see the primary purpose as commercial, and to stick to the CAN-SPAM requirements.
So, now that we know exactly what types of communications the law applies to let’s talk about what’s prohibited when sending these correspondences.
- Don’t use false or misleading header information: By header information, the FTC is referring to the information regarding what business the message is coming from and where the recipient would send a response should they so choose (or if no response is possible, that too must be clearly stated.) This is one that’s morally wrong and also wrong for your bottom line. It’s deceptive. You can’t sell people medical care under false pretense of being medically trained; and you can’t sell people your product under false pretense of a fabricated identity. Your brand is your word and your word is your bond. Giving your customer base the impression that you are anything less than honest about who you are – even in a fleeting correspondence such as an e-mail – is a terrible first impression. From a customer’s perspective, why would someone be honest about what value they can provide if they’re not honest about who they are in the first place?
- Don’t use deceptive subject lines. This one is pretty straight forward. If you’re e-mailing your customers about a promotional offer for a free consultation, say so in the subject line! This is one of the simplest forms of deception out there. Think about people who go door-to-door selling a product. The easiest way to get thrown by force off of someone’s porch is to start the interaction by lying. From a marketing perspective, it just doesn’t make any sense to be anything but transparent in the subject line. That space is your customer’s introduction to what you’re offering. Use it to be creatively concise and give them an honest idea of what the offer is right off the bat.
- Identify the message as an ad. This one’s obvious – a customer deserves to know right off the bat that what they’re reading is not personal correspondence but promotional. Luckily, there’s some leeway in terms of how this can be done, as long as it’s clearly stated somewhere in the e-mail you shouldn’t have to worry about this one.
- Tell recipients where you’re located. If your business includes a brick and mortar location, always include postal information somewhere in your e-mail. This is an easy one to adhere to because it’s never a bad idea to advertise your physical location. Also, most email service providers will require this information to be in the footer of your email to keep you compliant under their service regulations, anyways.
- Tell recipients how to opt out of receiving future e-mail from you. That process must be clearly described so that any recipient can stop future e-mails if they so choose. These step-by-step’s are typically short and sweet. Giving a return e-mail or some other internet-based solution is typically the best way to go.
- Honor opt-out requests promptly. This goes hand-in-hand with the previous requirement. Offering valuable content to your customer base means embracing the customer’s ability to know best what is valuable to them. When they opt out of a communication you are sending, see this as an opportunity to use that as important data to base future campaigns off of. In terms of the technicalities, any opt-out device you display must be able to follow through with their request for at least 30 days after you send the original message. Additionally, the request to opt out must be honored within 10 business days. As for the device itself, it can never involve charging a fee (remember – greed isn’t a good look!), giving further personal information, or taking any further steps than sending a reply e-mail or visiting one additional webpage. This may be the most important requirement on the list because it gives the recipient such an immediate idea of what your purpose is. When they know right away that they can stop the e-mails, they’ll feel assured in your desire to demonstrate genuine value to them, and will make them more comfortable engaging with your offer.
- Monitor what others are doing on your behalf. This comes into play if you contract your e-mail marketing services out to another agency. If you are paying them to use e-mail for your marketing, you are responsible for what’s done on your behalf. Respectable marketing agencies would never want to take part these types of deception, but as with any decision that affects (and reflects) your brand, make yourself involved with the process enough to know that strategies are being carried out in a way that emphasizes valuing your customers, not deceiving them.
What are the consequences for violating CAN-SPAM?
The consequences for violating CAN-SPAM are *not* to be taken lightly. Penalties of a financial nature can reach as high as $16,000. If the violations are flagrant in their deception, the law also provides for criminal penalties (including imprisonment). These types of violations include:
- Accessing someone else’s computer to send spam without permission
- Using false information to register for multiple e-mail accounts or domain names
- Relaying or retransmitting multiple spam messages through a computer to mislead others about the origin of the message.
- Harvesting email addresses or generating them through a dictionary attack (the practice of sending email to addresses made up of random letters and numbers in the hope of reaching valid ones)
- Taking advantage of open relays or open proxies without permission.
As you can see, these aren’t the type of sanctions that your business can afford to have directed at it. So: take the tips listed above seriously, treat your customers with the respect that this kind of legislation requires, and you won’t have to worry about it.
Remember, legitimate companies use marketing tools like e-mail to demonstrate genuine value to their consumers; not-so-legitimate companies use them to deceive them. In terms of what kind of business a consumer wants to deal with and what kind of business you want to become, I think the choice is pretty clear.