'Do Not' Madness

Whoa. Within the last month, unemployment in the United States hit a 20-year high, new federal deficit projections exceeded $400 billion for the first time in history, and the economy continued to struggle to wake from its long, cold slumber. So someone please tell me why the government implemented new marketing regulations that will force a previously productive industry to slash millions of jobs and will drastically harm many companies’ ability to survive and compete?

Do Not Call

Of course I’m talking about telemarketing and the Do Not Call Registry recently created by the Federal Trade Commission (FTC). The list has grown to over 27 million phone numbers since it opened for business on June 27. The upside to the registry is you may receive less “courtesy” calls at inopportune times.

The downside is dire. The telemarketing industry employs an estimated 6.5 million Americans, according to the American Teleservices Association. Five percent of those employees are disabled individuals and 26 percent are single mothers. Experts expect 2 million telemarketing jobs will be lost when the Do Not Call Registry takes effect in October.

The fallout doesn’t end there. According to The Direct Marketing Association, organizations spent about $80 billion on teleservices in 2001, which generated nearly $720 billion in sales. Those figures will certainly drop significantly as well, causing further negative ripples throughout the economy.

Are those dinnertime phone solicitations a nuisance? Sure. Most people don’t exactly enjoy sitting on the phone with a telemarketer while the rump roast is getting cold. But is outlawing legitimate telemarketing practices worth the massive loss of jobs and revenues in today’s economy? The government apparently thinks so.

I say it’s not. Though no one can deny the massive sign-ups indicate consumers are annoyed by telemarketing, there is a better approach in a free market economy that can preserve jobs and create market opportunities that help the economy rather than hurt it. If you’re really, really annoyed by telemarketing, you have several options:

• Pay a small fee to the telephone company to have your telephone number unpublished (take it from me — this drastically reduces call volume).
• Buy one of those cool telemarketing zappers.
• Vote with your wallet by buying products from companies that respect and meet your specific needs.

Hate those annoying credit card telemarketing calls from your credit card company? Some credit card companies, such as Capital One, offer “no telemarketing” cards.

In a free market we can make choices that help rather than hurt the entire economy. At the end of the day, marketers take notice when enough consumers vote with their wallets. Think about what every credit card company in the world would do if Capital One’s “No-Hassle” telemarketing-free credit card had 27 million new customers in three weeks. Imagine how customer satisfaction and loyalty rates would jump if every Fortune 2000 company asked customers about their solicitation preferences.

Do Not Advertise

So what’s next? The popularity of the Do Not Call Registry among consumers has some legislators, New York Senator Charles Schumer for one, calling for a Do Not Spam Registry. This is a flawed idea that also raises several questions and concerns.

For starters, where do we draw the line and what role does the government play in establishing national “do not” lists? Unsolicited telemarketing calls and email are a nuisance and, by definition, impose on people’s time since they’re not requested. But what’s next? Do not air commercials on TV and radio? Do not place ads in newspapers and magazines? Do not display billboards on highways? Do not post ads over urinals in men’s rooms? Do not hand out leaflets on the street? Do not float blimps over stadiums? Consumers never requested those marketing impositions either.

To be clear, I run an organization that produces permission-based (opt-in) email communications solutions for its clients. But I would argue it’s not the government’s role to dictate marketing practices. The only role the government should play in this regard is to protect consumers from fraudulent, deceptive, and offensive marketing practices, regardless of the medium.

A recent Forrester Research report, “Essentials of Integrated Marketing,” noted: “In the next decade, marketing will be defined by one grim reality: Consumers will have more power to avoid ads.” The optimistic permission-based marketer in me says, “Wake up, everyone! Self regulate and turn that grim reality into a market opportunity.”

A call to marketers: Understand your customers’ needs, be relevant, and, most important, respect customers’ preferences and privacy. You must execute contextually relevant and timely opt-in communications.

A call to consumers: Exercise your power as a buyer in ways that help — rather than hurt — the economy. If you don’t want to see TV ads, buy a TiVo. If you don’t want to listen to a telemarketer, buy a zapper, don’t publish your number, or let the answering machine pick up. And finally, if you don’t want to receive unsolicited email, opt out, turn on your personal spam filters, or hit delete.

And delete people do. According to a 2003 survey commissioned by Bigfoot Interactive and conducted by RoperASW, the overwhelming majority of respondents chose deleting as the preferred method of dealing with unwanted email (both unsolicited and permission-based).

A Do Not Spam Registry may seem like a decent idea on the surface, yet most experts — including many anti-spam advocates and technology gurus — believe it will produce a negligible effect on the volume of spam polluting inboxes while creating huge operational, logistical, security, and legal costs. Spammers will not pay attention to it, and the management and maintenance of a national Do Not Spam Registry presents extremely daunting challenges.

Alternatives

The more feasible answer lies in a combination of efforts:

• Legislation against fraudulent and deceptive spam
• Better education for marketers so more will follow best practices for permission and delivery
  
• Improved technological solutions to keep spam out of inboxes

At the end of the day, the market will reward marketers who understand their customers’ preferences and follow best practices to help build stronger, more profitable long-term customer relationships.

Everyone hates telemarketers and spam, and politicians love to look like heroes (especially with elections on the horizon). But let’s not overcomplicate things by implementing supposedly well-intentioned solutions that will be nightmares to manage and will shrink legitimate industries that contribute billions of dollars to the economy in the form of jobs and revenue.

Want to help stop the do-not madness? Contact your senators and representatives. New Yorkers can contact Sen. Schumer, who is leading the Do Not Spam charge, through his Web site. Send him an email. Give him a call. Float a blimp over his office — whatever it takes. But do it quickly, before they create a Do Not Blimp Registry and try to deflate another industry.

Until next time,

Al D.