October 25, 2014

5 Legal Concerns All Lead-Generation Marketers Must Know About

Strategies, tactics and budgets often lay claim to a lot of marketers’ attention.

Laws, legal concerns, regulations

But all that could mean nothing if a law or regulation is violated and dire consequences are handed down by the powers that be. So to help marketers navigate their pursuit of leads in a way that complies with the rules of play, here’s a rundown of five areas of legal significance marketers must be aware of.

Privacy and piracy
The Stop Online Piracy Act (SOPA) and Protect IP Act (PIPA) created very public tension between media companies and consumers. Remember the blackout of sites like Wikipedia and Reddit, along with those blacked-out profile pictures on social media sites? Yeah, those were forms of protest against these acts.

Additionally, Microsoft’s “Do Not Track” feature in its Internet Explorer 10 Web browser highlights a growing emphasis on user privacy on the Internet.

“Lead-gen marketers need to have a compliance team in place that monitors the usage of their brand’s proprietary content, particularly from foreign-owned websites,” says Peter Klein, senior vice president of media and head of MonetizeIt, the MediaWhiz affiliate network. “Furthermore, marketers must be prepared to update their online tracking systems or use platforms that can support ‘cookie-less’ tracking down to granular levels. While some of these items may not come to fruition, they are a sign of deeper measures to come.”

Children’s privacy
Joy Butler, a business lawyer in Washington, D.C., and author of “The Cyber Citizen’s Guide Through the Legal Jungle: Internet Law for Your Professional Online Presence,” points out the importance of being aware of a consumer’s age.

“The Children’s Online Privacy Protection Act (COPPA) requires posting a privacy policy on the company website and getting parental consent before collecting names, email addresses or other personal information from children under 13,” Butler explains. “Marketers must pay attention to COPPA if the marketing campaign is targeted to children. Federal regulators take kids’ privacy rights very seriously and have issued fines of up to $3 million for COPPA non-compliance.”

Testimonials
The FTC has extensive guidance regarding online advertising, and the commission is coming down hard on offenders. Marketers need to be aware of the FTC’s guidelines regarding testimonials and product claims.

“Lead-gen marketers need to ensure they can substantiate all product claims with research and written approval from the individual providing a testimonial,” says Klein. “Additionally, if there is any money or other tangible benefit exchanged for such testimonials, a clear disclaimer is necessary on the website landing page to let consumers know it is a paid endorsement.”

Email compliance
The CAN-SPAM Act lays out rules for commercial email correspondence and gives consumers the right to stop receiving emails from businesses. Marketers need to remember that the CAN-SPAM Act doesn’t just apply to bulk email. All email must comply with the law.

“Each separate email in violation of the CAN-SPAM Act is subject to penalties of up to $16,000, so non-compliance can be costly,” according to the FTC.

“To comply with CAN-SPAM, a company’s email must include an accurate subject line, a valid physical postal address and information on how the customer can opt out of receiving more email from the company,” according to Butler. She notes this is especially important for businesses sending emails to leads.

The FTC also notes that companies must monitor what others are doing on your behalf. In other words, “you can’t contract away your legal responsibility to comply with the law” when you hire another company to take care of your email marketing.

Affiliate nexus tax laws
More than a few states have passed or are in the process of passing “Amazon tax” laws, or “nexus tax” laws. This is related to the Marketplace Equity Act and the Marketplace Fairness Act, two pending bills that would enable states to make online retailers collect sales tax from in-state customers.

“These laws create a pseudo-sales tax that must be collected for affiliate sales on products purchased online,” Klein explains. “These laws will have a significant impact on agencies that operate within the affiliate network space. They will mean the loss for agencies of millions of dollars each year in products being sold on a revenue-sharing basis.”


By Jason Hahn

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