Privacy Advisor

In the Wake of "Do-Not-Call"

September 1, 2003

Mike Spinney

The overwhelming response to the National Do Not Call Registry has citizens cheering, marketers jeering, and politicians gearing up for similar efforts aimed at stemming the growing tide of unsolicited e-mail — otherwise known as spam — which many fear will increase in response to "do-not-call."

Forrester Research and other industry analyst groups have reported that spam makes up as much as 50 percent of all e-mail, a volume that is more than just annoying — it also costs. Billions. Yankee Group reports that one major Internet service provider it studied spends more than $5 million annually on disk storage just for spam it is unable to filter. Furthermore, a study by Symantec found that, on average, a company of 100 employees suffers more than $250,000 in productivity losses due to employee time spent handling spam.

Nationwide, Ferris Research estimates the total lost productivity cost to the U.S. economy at $4 billion, with another $3.7 billion spent on systems and personnel needed to deal with problems caused by spam.

With these figures in mind, Jupiter Research's prediction that spending on direct marketing e-mail campaigns will increase from $1.4 billion in 2002 to $8.3 billion by 2007 is likely to add fuel to the public's fire of discontent.

And it is discontent that Jennifer Barrett, chief privacy officer with Acxiom Corp., says got the marketing industry in trouble in the first place.

"Too many marketers look to response rates and not the fallout of telemarketing," Barrett explains. "But there's not a dissatisfaction rate to go along with that response rate."

Bob Langer, a partner with Peppers and Rogers Group, agrees. Langer says that marketers casting a wide telemarketing net in an effort to extract the most value out of a 2 percent response rate failed to "calculate the ill will from the 98 percent who don't respond."

Both Langer and Barrett believe that the marketing industry has only itself to blame for "do-not-call" and that the problem could have been averted by making a better effort at understanding the customer and improving one-to-one communications.

Langer says that companies need to "get better at understanding customers individually and understanding how each customer wants to be contacted. Once that happens, marketers will be more effective.

"By aligning communications channels with what the customer wants, we'll start to see companies that do a better job with direct mail" and other marketing methods, Langer continues.

However, Langer says he believes there will be plenty of marketers whose response will be to simply increase the volume of direct mail and spam. The danger in such a strategy will be a reaction similar to "do-not-call." But while a National Do Not Call Registry proved to be a relatively simple solution to the vexing problem of poorly timed phone solicitations, a do-not-spam list presents myriad challenges that aren't as easy to solve.

Shivon Dosky, cofounder and CEO of antispam technology developer Evolvian, points to the common practice of moving spam offshore to countries like China, India, and the Czech Republic where regulations are lax and costs are low.

Dosky says that there is also the danger that attempts to block or filter e-mail may prevent wanted communications from getting through.

"The greatest danger of a do-not-spam list is that what's spam to you might not be spam to me," Dosky explains. "The individual determines what is good and what is not."

"We need to maintain a balance between First Amendment rights and commercial free speech, and the consumer's right to privacy," Barrett adds.

And therein lies one of spammings great conundrums. The sense of privacy afforded by e-mail communication has proven to be a boon for industries peddling pornography, so-called adult products, and gaming, among others. E-mail marketing's success selling goods that fall in these categories has resulted in a deluge of unsolicited e-mail with content that many people consider offensive. The backlash from such content could be the industry's biggest public relations risk.

Whether marketers will move to more spam in response to the do-not-call list is still a matter of debate, but it seems to be a certainty that the well-established trend toward more spam is one that will continue. Experts like Langer, Barrett, and Dosky believe that the solution to increased spam should not come from the government but from better self-regulation within an industry that they hope has learned a valuable lesson from "do-not-call," and from better tools for individual control of spam.

"When the individual has control," Dosky says. "Privacy is maintained."

Mike Spinney
is managing editor of Privacy Officer's Advisor. He can be reached by calling (978) 660-4053 or via e-mail at spinzo@earthlink.net

This article was originally developed for INSIDE 1to1: Privacy, a Peppers & Rogers Group publication (www.1to1.com).