List abuse is a rarity in our industry, but as in any business, there are some who engage in unprofessional practices and a few who are knowingly out to scam people. There has been a rash of incidents among magazine publishers, and no one should think, “It will not happen to me.”
The truth is, there are a handful of unethical mailers, brokers and service bureaus that falsely obtain subscriber names in order to place renewal business through an unauthorized third-party agent or – even worse – take the money and run, leaving the subscriber high and dry.
A publisher once rented its subscriber file to a supposed direct marketer. The direct marketer appended telephone numbers and proceeded to call the subscribers for renewals. A significant number responded positively, sending checks to the caller or authorizing credit card charges, only to be duped into thinking they were continuing their subscription. After thousands of complaints, the publisher was onto the ruse and had to mount a major effort to properly reinstate the disenchanted subscribers – at great expense and time.
What happened to that publisher can happen to you. There are rogue agents who telemarket subscription files, get lots of money for phony renewals and then close their doors, leaving clean-up duty to the publisher.
That’s a worst-case scenario of subscriber abuse. There are other cases – misleading offers, risky investment promises that are too good to be true, bad pays, etc. While you can enjoy significant list rental income from legitimate direct marketers that have appropriate offers for your subscribers, the last thing your subscribers want is to think that that you’re releasing their names to just anyone. Part of good circulation practice is protecting your subscribers by policing list rental usage.
Good list usage police work begins with crime prevention, which is why list managers should work closely with publishers to stop list abuse in its tracks. Colleagues among list managers and publishers need to exchange information about questionable mailers and any substandard practices in their dealings with disreputable direct marketers and particularly shady agents.
By comparing notes, we jointly identify agents, mail houses, mailers and others we know have been less than ethical in the past. Knowledge of their activity may be supported by background checks obtained from credit applications, references, the Better Business Bureau, and Dun & Bradstreet reports. If there’s a doubt, any good list manager always checks it out.
There are several eyebrow raisers that should alert us to suspicious mailers and brokers:
• Check company references if an order is received directly from a mailer or shipping directly to the mailer if this is generally out of the ordinary for that particular mailer.
• Contact the mailer if you see that it is constantly switching to an unknown broker. In some instances, a broker may pretend to represent a mailer.
• Verify new mailers and brokers.
• Examine orders specifying a narrow geo-select with a nondirect mail sold source, which could indicate that the customer might send it to a telemarketing firm for phone number appending.
• Inspect large test orders of 50,000 or monthly name rentals of subscribers who have already paid.
Your list manager should ensure that the sample mail piece is genuine by first calling the phone number on the sample or checking for a phone listing. If it’s a wrong number or there is no listing, chances are it’s a phony sample. You should also insist that the specific offer’s details be spelled out. For example, if the list user is promoting a seminar, dates and places must be identified. For merchandise, product pricing and guarantees must be clearly indicated.
In some cases, investigators have actually responded to suspicious offers and sent money while alerting the postal inspector. In at least one case, the list manager tracked down the criminals and they were convicted of mail fraud.
All of your agents should sign a subcontractor contract, which informs them that their business practices will be monitored. It’s a fine line to walk – encouraging more sales, but discouraging bad behavior. When pressured to sell subs, some agents may enter into questionable practices such as high pressure sales tactics, gaining unwanted sales, renting competitors’ mailing lists without the competitor knowing it and more. Your list manager can help by bringing suspect business dealings to the circulator’s attention.
Finally, we all seed our lists. But do we monitor the activity closely enough? Make sure you track each and every seed package. Not only will you catch those who should not be using your file, you will get an idea of what your subscribers respond to.
