Ethics Alert Series

Text Marketing: Highly Regulated and Needs Permission

By Senny Boone    April 23, 2024    

Self-regulation and ethical marketing are at the core of building consumer trust and loyalty. This ethics update series focuses on key consumer marketing issues to highlight the ethical standards of applicability and to assure best practices are communicated and followed. This is not intended to replace legal advice and counsel. Please consult with your counsel on compliance to ensure you are following the laws specific to your organization.

Background

Text marketing, also known as SMS marketing, is a mobile marketing technique that involves sending text messages to customers and prospects. Text messages can include promotional offers, discounts, appointment reminders, and shipping notifications. Texting to reach your customer can be a valid and useful marketing practice to advance your goals. However, you will need to ensure you are following text communication rules and engaging in ethical marketing as new regulation and litigation is increasing in this area for companies that send texts as part of their marketing practices.

Consumers are likely to believe that the texts received are legitimate and from a trusted source. Unfortunately, consumers have been inundated with so-called unwanted "robocalls" and "robotexts" over many years.

It has been one of the top consumer complaints sent to the Federal Communications Commission (FCC) and the Federal Trade Commission (FTC). In fact, according to the FCC, text message scams are an increasingly pervasive consumer threat, with a more than 500 percent increase in complaints in recent years. From 2015 to 2022, robotext complaints rose from around 3,300 to 18,900 per year. The FTC has reported that text messaging scams cost consumers $86 million in 202 and $366 million in 2022.

Robotexts pose a unique threat to consumers: Unlike robocalls, scam text messages are hard to ignore or hang-up on and are nearly always read by the recipient – often immediately. Most concerning, robotexts can promote links to phishing websites or websites that can install malware on a consumer's phone.

Additionally, in ANA's self-regulatory efforts, we are seeing cases involving companies using text messaging in their marketing efforts and issues involving not obtaining appropriate consumer consent or providing an appropriate method for the consumer to opt-out of receiving such text messages.

Examples:

 

The text above is included in a scam alert issued by the FTC in a 2020 consumer blog.

This is a typical text message scam people are receiving that claims to be a FedEx tracking notice. In variations on the scheme, fraudsters also are falsely invoking the names of UPS and the U.S. Postal Service. According to the text, there's a "delivery" that needs to be scheduled by clicking on a link. From there, people are taken to an "Amazon" page, which invites them to complete a customer satisfaction survey. Then they're told they've won a free prize. Just input a credit number to cover shipping and handling.

But as the blog post explains:

The text isn't from a delivery service.
There is no package.
That isn't a real Amazon page.
That's not a customer survey.
And there's no free prize.

Excerpt from casework regarding a text promotional message:

When engaging in text marketing communications:

• Include in your privacy policy, what your text marketing information collection and use practices are and how consumers can manage those messages.
• Identify who is sending the text.
• Obtain prior written consent of the consumer to send such messages.
• Enclose how the recipient can opt-out of receiving such texts.

Rules and Guidelines

The TCPA and Do-Not-Call. There are strong protections for marketing calls to consumers that have been extended to texts, specifically in the Telephone Consumer Protection Act (TCPA) and the Do Not Call (DNC) rules. Prior express consent of the consumer is required for calls and texts sent using an automatic telephone dialing system, and for calls made to mobile telephone numbers using a prerecorded or artificial voice. (See 47 U.S.C. section 227 (b)(1)(a).)>

Federal Communications Commission

The FCC has announced extensive rule changes to include texting issues:

• Mobile service providers are to block robotexts that are illegal at the network level (not via consumer opt-in or opt-out) and have a point of contact for the sender to ensure consumer protection.
• The national Do Not Call list registry protection for consumers for unwanted telemarketing calls applies to texts as well.
• Ending the "lead generator loophole" that had enabled companies to use a single consumer consent to deliver robocalls and texts from multiple marketers. In other words, 1:1 consent, requiring prior express written consent specific to the company is needed to send text messages.

Federal Trade Commission:

The FTC is warning consumers not to click links or respond to unexpected text messages. The agency advises people to report all suspicious texts to ReportFraud.ftc.gov or to forward the potential scam message to 7726, or SPAM. Reporting dubious texts in this way helps cellphone-service providers stamp out fraudsters.

Resources:

• FTC Business Guidance on Telemarketing, including Texting
• FCC Robocall Response Team: Combating Scam Robocalls & Robotexts
• CTIA - Protecting Yourself from Spam Text Messages (mobile industry organization's guidance for consumers)

ANA Guidelines:

ARTICLE 6. USE OF PRERECORDED VOICE & TEXT MESSAGING (See, ANA Guidelines, p. 33.)
Marketers who use prerecorded voice messaging should not automatically terminate calls or provide misleading or inaccurate information when a live consumer answers the telephone.

Consent Required. Marketers should only use text messaging sent via Automated Dialing Equipment or prerecorded voice to sell goods or services if they have first obtained the call recipient's prior express written agreement to receive prerecorded messages through a written form which may be electronic to the extent permitted by law. In obtaining the consumer's express written agreement, a marketer should observe the following:

• Before obtaining the consumer's informed consent, the marketer should clearly and conspicuously disclose that the purpose of the agreement is to allow the marketer to make prerecorded message calls or send autodialed texts to the consumer.
  
  
• The written agreement should evidence the consumer's informed consent to receive prerecorded calls or text messages by or on behalf of the specific marketer.
  
  
• The marketer should not require that the consumer agree to receive prerecorded calls or text messages as a condition of purchasing any good or service.
  
  
• Disclosures that the individual's consent allows the marketer to make prerecorded calls and/or text messages, and that providing consent is not a condition of any purchase, should be made at the time the marketer is seeking written consent.
  
  
• Disclosure that by executing the agreement, the individual authorizes the marketer to deliver to the individual marketing text messages using Automatic Dialing Equipment or a prerecorded voice.
  
  
• The agreement should include the consumer's telephone number and signature.
  
  
• Marketers may obtain the written agreement electronically in accordance with applicable laws such as the E-Sign Act.

We anticipate additional updates to the ANA ethical guidelines and national regulations on text marketing as we work to update the ANA Marketing Code of Ethics. We welcome your involvement in our drafting process to ensure we capture best practices from our practitioners and marketers involved in text marketing and related efforts.

Center For Ethical Marketing Resources and Complaint Form

• See ANA Center for Ethical Marketing: for industry and consumer resources, guidance, guidelines, alerts, and committees.
  
  
• We welcome complaints/inquiries from members, you can file a complaint with the ANA Center for Ethical Marketing staff or our Ethics Review Committee to review and take appropriate action regarding a marketing practice such as a fake robocall or text marketing scam.
  
  
• Contact us to participate in ethical marketing development or to report a complaint at: ethics@ana.net.

---

Senny Boone is the SVP of the Center for Ethical Marketing at the ANA, where she directs programs on ethics and accountability in marketing. Senny has three decades of communications law experience spanning marketing, fundraising, and privacy issues. She has a J.D. from Catholic University in Washington, D.C. and is a member of the District of Columbia Bar and New Jersey Bar. You can connect with Senny on LinkedIn.