Privacy: It's Not Just a Consumer Issue

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Most business-to-business marketers think that because the data they collect isn't personal the current privacy debate doesn't apply to them. However, areas are emerging to which BTB marketers should pay heed.


First, business purchases still are done by individuals, especially in small companies. Individuals are consumers, so what interests consumers on the privacy front may interest individuals in companies.


Second, there's no point in communicating with someone who's not interested. So a lot of the same choices that help protect privacy -- like offering opt-out and maintaining suppression lists -- can help lower costs and improve return on investment. For example, some corporations have directed their mailrooms not to deliver bulk advertising mail to end-user addressees. We may not agree with the policy, but until it's changed we need to suppress that company from our mailing lists -- or waste a lot of money.


Third, business owners and managers may resent the impact of some marketing efforts on their organizations. For example, junk faxes tie up telephone lines. Or premium offers may be used for personal gain and influence a business buyer to make decisions that aren't in the best interests of the company.


Fourth, companies that do business abroad are already subject to privacy regulations. It's important to be compliant with these and familiar with any privacy regulations on our shores.


Of course, this raises the fifth point: Although there are sector-specific privacy guidelines, the United States in general doesn't have broad privacy regulations. Taking steps early and often will certainly reduce the risk of crippling legislation. The DMA has called on all its members to follow its notice and implement privacy guidelines by July 1. The Federal Trade Commission has concluded that our efforts at self regulation may not be sufficient, and time's awasting.


Finally, as DMA board member Bob Kestnbaum said in DM News last month: "Satisfying the demands of customers is simply good business." If your customers are not actively asking you to keep what you know about them private, they surely will, and soon. You'll also find that opt-out practices can have a welcome marketing benefit: As your customers state their preferences, they are providing you with updated information about their needs and interests.


There is something common sensical about all this. And as companies increasingly migrate their business processes to the Web, privacy concerns that have been fueled by the Internet need to be addressed sooner rather than later. As always, the solution to the issue of privacy will require a combination of rules, processes and technology.


Much of what we should do already has been identified. The problem is that, as an industry, we are not consistently applying the practices that will make customers think we are responsible for and responsive to their concerns for privacy protection. If we don't change this situation in fairly short order, we will find that a solution will be legislated for us. Pressure from the Congress and the European Union threaten to place restraints on our ability to conduct business as direct marketers, both on and off the Web.


Self-regulation has always been the policy of the DMA. Now it's time for industry to adopt a standard for self-regulation and show its commitment by implementing specific actions.


Adopting a standard framework for privacy that includes notice, choice, access, security and oversight will make it easier for customers to understand their rights and increase confidence in industry's ability to self-regulate. Privacy isn't just a consumer issue, it's an issue of doing business. BTB marketers must join their consumer-focused colleagues in implementing this policy.


The Clinton administration supports self-regulation over legislation. However, we have been given only a small window of opportunity to demonstrate that self-regulation works, and thereby avoid the restrictive and costly controls that legislative compliance carries. The administration will provide global leadership to promote self-regulation over governmental legislation as the internationally accepted policy for privacy.


The European Union already has indicated the currently proposed seal programs such as BBBOnline or TRUSTe, if enacted as described, would be an acceptable alternative to legislation.


What BTB marketers should do. Be proactive; don't just hope the issue will go away. Move fast. Think about customers first. Offer regular and convenient opt outs for all media (telephone, mail and e-mail) and suppress appropriately. Offer additional clear opt outs relating to information that will be rented or shared; acquire only rented lists whose managers follow similar policies.


Write a Web privacy policy based on the five principles of notice, choice, access, security and oversight, and post it on your site. The DMA and the Online Privacy Alliance provide useful tools to get you started. Don't promise what you can't deliver. Adopt the self-regulating guidelines of such industry groups as OPA, TRUSTe and BBBonline.


Join the OPA (www.privacyalliance.org). Get informed about the European Data Protection Directive. Join the BTB Council in assisting the DMA to build and operate a BTB preference service for mail, phone and e-mail.


Ruth P. Stevens is director of direct marketing at IBM Software Group, White Plains, NY, and Judy Kincaid is worldwide customer information manager at Hewlett-Packard, Palo Alto, CA. Both are members of the operating committee of the DMA's BTB Council.
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