Opinion

Don't spam your way out of business

Peter Dorrington
Using permission-based marketing will keep your customers happy

It seems that everyone everywhere is asking you for personal information whether it is for the census, a new credit card or loan and it is causing concern.

The information commissioner Elizabeth France, the UK's data protection watchdog, reported that her office received 20,000 calls last year from adults in the UK who were worried about how much information about them is stored and how this might be used without their knowledge.

Many businesses, especially retailers, have access to information which is used for targeted marketing. But how much do organisations need to know and what can be done with this data?

Meet Jeff Brown. He is a 45-year-old married banker with two children. He lives in a four-bedroom house in Northwood, Middlesex, drives an Audi TT and earns £50,000 a year. He pays £900 a month into his mortgage and has three credit cards. His wife also has a store card. He likes going out to eat and occasionally works out at his local gym. His family shops at the local Sainsbury's and they all go on one holiday a year, usually to somewhere like Florida where the kids, who are 10 and 14, can enjoy themselves. He supports the Conservative Party and reads the Financial Times. How is this known by a business that has never dealt with him?

In April, UK residents had to complete the census. This research is carried out every 10 years to help with the Government's strategic planning - how many schools, hospitals, roads, police officers and so on are needed in any given area of the country. Controversially, summaries of the census data will be available to business. This will provide information on demographics within a postal district such as numbers of married couples, age groups and car ownership.

Data is also extracted from the electoral roll. Add to this market research, for instance media consumption, and a company can begin to establish a fairly accurate picture of people within a given postcode area. With all this information, a company can begin to formulate targeted marketing campaigns aimed at making people aware of products and services that may be of interest. In addition, a firm may sell this customer data.

Does this activity break the Data Protection Act?

In most cases no. But companies should take a responsible approach and invest in techniques such as permission-based marketing whereby customers agree to receive further information. Many companies spam customers without seeking permission and the situation is likely to get worse.

A recent ruling by the EU Committee on Citizens' Freedoms and Rights to opt out of enforcing a blanket ban on junk mail will open the floodgates to unwanted adverts. If a customer does not want to receive these promotions, they must go out of their way to have their name taken off the list. To add further insult, mobile phone users will be charged by their service operator to receive these messages.

Businesses need to remember that customers want more than just products or services - they want good customer service and information that is accurate. If companies do not provide this, they will alienate the very people they are trying to attract.

Peter Dorrington is business solutions manager at customer relationship management specialist SAS UK

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