FEATURE 

Is publishing caught up in the permission quagmire?

Rosemary Smith, director of data protection consultancy Opt-4, uses recent research to challenge publishers about permissioning and assesses the impact of increasing opt-out on the magazine business.

By Rosemary Smith

The best market research confirms some of your suspicions and throws up some real surprises. When Opt-4 recently asked marketers to contribute to the debate about permission marketing, we knew there would be some strongly held opinions. But nothing prepared us for the extreme dichotomy between the views of marketers (including a fair number of publishers) and those of their audience.

Why didn’t we predict it? Well, the supreme irony is that these two groups were, in fact, the same people. We asked respondents to give us their feedback firstly, as consumers and secondly, as marketers. What we found was a severe case of schizophrenia.

Take the results to a question about giving away personal information as a consumer or asking for it as a marketer – see graph below. The respondents were truthful enough to admit that, when they act as consumers, they are often wary of handing over their information for marketing purposes. For example, 76% of respondents would be happy asking for home phone details, but a massive 82% would protect themselves from marketing calls at home.

The research strongly re-enforced the DMA’s recent Participation Media survey which suggested telephone to be the most intrusive direct marketing medium.

Given that it is electronic communications that have been dealt the most severe opt-in regulations, the relatively low levels of concern for this channel are interesting. One respondent noted, ‘I hardly ever release my postal details and never my phone number but usually my email address, only because an email is easier to discard should it not interest me’. There may also be an environmentally sound view that email is less wasteful than direct mail.

Opt-in, opt-out

The difference of permission opinions didn’t stop there. We went on to ask the respondents what they thought about the opt-out versus opt-in debate. Typically, online marketers have favoured opt-in (although it is not necessarily required by the regulations); meanwhile the offline marketing community generally shake at the thought of opt-in. Again, the results showed an extraordinary symmetry and neatly summarised the reversed expectations of marketers and consumers. Whilst as marketing professionals, two thirds felt permission should be opt-out, as consumers, two thirds thought it should be opt-in!

Back in the real world of magazine marketing, there are myriad approaches being used to gain information and permission to market. Not all of them would stand close scrutiny in terms of the current data protection legislation, let alone best practice and even fewer would stand the "would I give permission myself?" test.

Publishers in general, and circulation professionals in particular, are unlikely to get too excited about writing data protection permission statements for use on their subscription marketing promotions and qualification cards. Not, at least, until they find the opt-out rate has shot up or, worse still, that they’ve collected a whole bunch of names illegally. Subscriber names are a valuable commodity, a primary asset of any magazine business, but their use is limited if they do not come with positive permissions.

Permission statements

We researched some live examples of badly written permission statements. They ranged from the terse one liner with no opt-out box (which produced the highest disapproval) to paragraphs of legalese headed "Data Protection Warning" (second highest disapproval). Predictably, the opt-out rates to all these statements were high (especially when respondents were acting as consumers).

Some permission turn-offs, which were more likely to alienate, emerged. One common thread appeared to be that by giving permission for unspecified and general ‘marketing purposes’ the consumer would enter an unstoppable ‘sales message sausage machine’. Another was that relationship with the brand was all important. One marketer commented:- "it is very interesting seeing the permission statements ‘out of context’. It made me realise how much influence the brand has on me as a consumer on deciding whether to release my info or not."

Statements which use more emotive words and reflect the brand tone of voice or values often work better in gaining permissions. A sample statement for a charity used these techniques to great effect. Writing statements which refer to "data" rather than "information" or "details" can seem impersonal. However, it can depend on the context. The following statement for the web, which used assumptive consent, was the best received.

"By completing your email address you are agreeing to receive newsletters and other offers which we believe will be of interest to you. Your data will be used in accordance with our privacy policy; click HERE to read".

If publishers want informed permission they need to come clean about subsequent data usage. Readers need persuading, cajoling and even incentivising to part with their information.

Transparency

Clarity about what was going to happen to personal information also seems to be an important permission trigger. We asked our responders whether they believed that being more transparent with consumers about use of their data has a positive impact on brand values. A huge percentage agreed that it did.

It might be argued that this was a leading question and respondents might be expected to take ‘the moral high ground’. Nonetheless, a 90% agreement that a positive brand impact can be attained from transparency, should encourage all marketers to adopt best practice approach.

The flip side to this, of course, is the negative impact on a brand of misleading or poorly expressed permission statements and privacy policies. The impact of higher opt-out rates for publishers could change the metrics of circulation finance. Some revenue streams could dry up completely.

Third party

Seeking permission for third party list rental (a major source of income for publishers) was also problematic. We asked for opinion and found a high level of consumer opt-out from 3rd party. Despite saying details would only be passed to ‘carefully selected third party organisations we are working with’ third party permission only gained a 16% acceptance.

If replicated in a commercial environment, this low figure would have serious implications on a publisher’s ability to gain third party list rental revenue. And if typical elsewhere, then the whole list rental market would be seriously impacted, affecting list owners, brokers and of course users – publishers included - who might be struggling to find appropriate cold data volumes.

From the DM professional viewpoint the ‘withhold to both’ figure was virtually the same as it was for the consumer. However, perhaps reflecting the professional need marketers have for rented lists, third party acceptance rate by marketers doubled to 35%.

A few magazines make more money from list rental than they do from advertising but, even internally, there can be opposition to this revenue stream. The belief that readers will become fatigued by third party promotions and thus respond less well to a publisher’s own offers is countered by evidence that keeping the names active means more renewals.

If publishers don’t make permission strategy a key part of their future planning they may be heading for opt-out fallout.

Opt-out rates

Anecdotal evidence from publishers suggests that opt-out rates are growing and, certainly, that third party permission is getting harder to obtain. It is all relative, of course. Some sectors (those targeted most often) attract much higher opt-outs than others. Some channels are more sensitive than others.

This isn’t just a problem for consumer publishers; business to business contacts also need careful handling. They are subject to the Data Protection Act 1998 but are exempt from some of the electronic regulations.

76% of the respondents to the Opt-4 survey believed that opt-out rates would increase over the next year. If we are looking at an ever diminishing pool of marketable individuals, fatigue is bound to set in.

As one of the survey respondents commented: "once customers have withdrawn permission it is very hard to get it back. Prevention is the cure." Another sagely observed, "individual consumer preference for channel and type of offer/product/service will be key future drivers, but above all the image and reputation of the specific company in the eye of the consumer will drive permissions."

This is, finally, where publishers have an advantage. Readers relate to the titles they read very personally (as years of PPA research has proved); the relationship may be the key to driving positive permissions.

How many publishers use their special relationship with readers or even the title’s unique tone of voice when they are drafting permission statements? How often are different statements tested to understand what is triggering opt-out? It really is possible to draft legal statements that don’t sound like cigarette packet health warnings.

A permission strategy should cover how you intend to collect data (opt-out/opt-in/third party use?) and how you will store and use it (by channel). Beware; if you offer readers choices and then fail to implement them you will alienate even the warmest audience. The strategy should include your position on ‘best practice’ versus the bare legal requirements and have some element of future proofing (what happens if the rules change?).

All of the research suggests that publishers, like any other users of direct marketing, should pay more attention to the detail of how they collect reader information and permission to use that information.

If even the marketing community is getting wary of releasing personal data, what hope have we got of persuading the consumer?

A full copy of the research "The Opt-out Fallout" is available from Michele.higgins@Opt-4.co.uk