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March 03, 2014

With So Many Rules, Are Robocalls Worth It?

By Susan J. Campbell, TMCnet Contributing Editor


Where do you draw the line between free commerce and unwanted annoyance? This is a common challenge among marketers, especially those that engage in telemarketing. Companies want to engage customers and make sales; consumers want to be sold to and left alone; and the Federal Trade Commission wants sound practices. How do you balance the dichotomy in the marketplace?


The FTC (News - Alert) spends considerable time and resources trying to answer this question, responding to consumer complaints while still protecting commercial opportunities. A recent Computerworld report pointed to the agency’s latest efforts to better align telemarketing regulations with its rules for prerecorded marketing calls.

Also known as robocalls, these computerized attempts to reach customers with the right message could cost a company dearly if explicit permission is not granted by the recipient ahead of time. Statutory damages could reach $500 to $1,500 per call or text. Failing to use telemarketing software that adheres to strict guidelines could open the door to too many unwanted calls, racking up fines in the millions.

In a rule that became effective October 16, 2013, marketers are now required to secure prior express written consent from each person they contact via a cellphone or landline with autodialed texts or prerecorded messages. In the past, companies engaging in outbound marketing with telemarketing software solutions and predictive dialers could do so easily if there was an established business relationship with the intended customer.

If the communication is strictly informational, robocalls and texts are still allowed.

Otherwise, companies do have to get a signature from customers with a clear and conspicuous disclosure that they will receive advertising from the company to which they are granting permission. It’s really no different than the salesman making a cold call in person, getting a face-to-face with the owner of the company and then asking if he can call him again in the future. This approach is generally used for higher value sales, however, and not the advertising type generally used in automated calls.

Once permission is granted, it cannot be transferred between the multiple brands under a single umbrella. Plus, consumers also have to be able to easily opt out of unwanted communications if they change their mind in the future.

In short, telemarketing software and other proven tools can still lend incredible value in the marketing environment, but company leaders need to be completely clear on FTC guidelines. Reaching out to consumers who don’t want to be bothered could cost the company plenty, putting into question whether or not robocalls are worth the investment or if the live agent is the better way to go.


Edited by Rory J. Thompson


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