The Next Wave of Legislation Affecting the Loyalty Industry?

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For months now, the FTC has been calling for a “do not track” list. Similar to the past efforts to roll out the popular “do not call” list, the FTC had been urging businesses to self-regulate their monitoring of consumer activities on the web.

But, the legislative tone on this issue just heated up. Yesterday, Senator Kerry called for governmental legislation and indicated that he is working with Senator McCain on possible wording of a Senate “privacy bill of rights”. Add that to a bill that was proposed in the House of Representatives last month and you can see that there could very well be legislation on the way that affects the broad spectrum of web commerce, direct marketing and loyalty initiatives.

I shudder to think about federal legislation or the launch of a “do not track” opt-out list for consumers. Surely, direct marketers have learned that proactive self-regulation and sound practices offering choice to our best customers is a much better path. Sadly, it could already be too late as a “privacy bill of rights” is an easy, populist banner for politicians to wave.

Whether the legislation gains steam or not, loyalty marketers should take stock now of their privacy policies to get them in shape. Here are 3 activities that you should undertake immediately to get started:

  • Do you have a published privacy promise for your customers? If not, draft one immediately and make easily accessible. Clear disclosure of what data you are collecting on your customers is a must-have and the most basic of table stakes. As customers enroll in your loyalty program or CRM initiative, make sure customers have access to that policy as part of your standard terms and conditions.
  • Add an opt-out – specific to tracking on-line behavior – to your existing opt-outs on receiving mail, email or call/text communications. Allowing customers the choice to decide how and when they want you to collect information and communicate with them is the customer-friendly approach that today’s business environment demands. Just be sure to explain the benefits of tracking information in an easy-to-understand manner. It is easy for customers to say “yes, protect my privacy!” when the media hypes the debate points. But, they are just as demanding in their calls for more relevance from the companies they do business with.
  • Emphasize the win-win. Remember the “3 R’s” that COLLOQUY talks about regularly: Rewards, Recognition and Relevance. For loyalty marketers, that’s our ace in the hole. When customers see a meaningful value proposition, they are willing to exchange information with the companies they do business with. For 30 years, customers have opted-in to identify themselves and have their purchase transactions be tracked in exchange for tangible rewards, perks and benefits that show their loyalty is valued and communications that are tailored to their needs and preferences.

The COLLOQUY team will be watching these regulatory or legislative developments. But, as the cliché says: “an ounce of prevention …”

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