What could the marketing ‘soft opt-in’ mean for charities?

April 2023

Exemption to consent may be extended to not-for-profits

There seems to be a misconception consent is always needed for email marketing. It’s a point I’m often asked about. While consent might be seen as the most upfront and open way of collecting marketing permissions, it isn’t always legally required.

For business to consumer marketing (B2C) by electronic mail, there’s always been an exemption to consent available for commercial use, if specific conditions are met.

This exemption is known as the ‘soft opt-in’. A confusing term, as it essentially allows businesses to offer people the chance to opt-out. This exemption is why you might have come across opt-out boxes when, for example, purchasing a product online.

However, charities have been restricted to using this exemption for their commercial activities only. For example, if they have an online shop, and they’re not permitted to use supporter data gathered via the soft opt-in for fundraising purposes.

But the latest draft of the UK’s Data Protection and Digital Information Bill confirms plans to expand the use of the ‘soft opt in’ for not-for-profits and political campaigning.

What’s the ‘soft-opt-in’?

The laws governing marketing by electronic mail are covered in the UK’s Privacy and Electronic Communications Regulations (PECR).

Under PECR you need consent to send electronic marketing messages (for example by email and text) to what are termed ‘individual subscribers’, unless you can meet the conditions of the exemption. ‘Individual subscribers’ are people who personally subscribe to their email/SMS service provider.

The ‘soft opt-in’ exemption, can currently be used if the following criteria can be met:

  • Contact details are collected during the course of a sale, or negotiations for a sale, of a product or service;
  • An opportunity to refuse or opt-out of the marketing is given at the point of collection, and in every subsequent communication;
  • You only send marketing about your own similar products and services (not those of a third party); AND
  • You provide the ability to opt-out in every communication.

This strict criteria, in particular the first point, means this exemption has largely only been used by commercial businesses.

For more information see PECR Regulation 22 and the ICO’s Guide to PECR.

What might change?

It’s proposed the soft opt-in exemption will be extended to non-commercial organisations and purposes. The latest draft of the Bill sets out this could be used when the direct marketing is:

  • solely for the purpose of furthering charitable, political or other non-commercial objectives
  • where contact details have been obtained during the course of a recipient expressing an interest or providing support, AND
  • where the recipient is given a clear and simple means of objecting to direct marketing at the point their details were collected, and in every subsequent communication.

What do charities need to consider?

There will be choice to make as to whether to stick with consent as the lawful basis, or start collecting new data using the soft opt-in. You’ll need to weigh up the pros and cons.

It’s crucial to be aware this will only be possible to use moving forward. It isn’t an opportunity to re-contact people who didn’t give you consent, where you don’t have adequate records or where people have opted out in the past.

It raises some important questions. Will your CRM system be able to store multiple permission statuses for legacy data alongside new data gathered under the soft opt-in? Will people find it confusing, having got used to opting in? Will people tick the box, thinking they’re opting in, when actually they’ll be opting out?

A positive change

The proposed changes are supported by the Chartered Institute of Fundraising. Daniel Fluskey, Director of Policy and Communications says; “We have long advocated for the soft opt-in to be extended so that it could be used by charities and very much welcome the development to bring this in through the new legislation. Charities should have the same opportunities to fundraise as businesses have to market their services and products. But more importantly than that, charities and supporters can benefit from this more flexible approach to email marketing by providing an opportunity to develop a relationship or encourage people to support a charity where they have already expressed an interest in doing so.”

Claire Robson, GOSH Charity Data Protection Officer, is also supportive of the move; “Here at GOSH Charity, we welcome the proposed change in law that will enable charities to decide whether they want to apply the soft opt-in for marketing communications. However, we also recognise this isn’t a silver bullet and must be done with thought and care, ensuring our donors and supporters hear from us in the ways that work best for them.”

What about B2B marketing?

The rules on consent and the ‘soft opt-in’ under PECR do not apply to business-to-business marketing by electronic mail. Marketing to what are termed ‘corporate subscribers’. ICO guidance on this can be found here.

There are no plans to change this, so it will remain a choice for B2B communications whether to collect consent or not. However, we do need to be mindful sole traders and some partnerships fall under the definition of ‘individual subscribers’, so would fall under the consent / soft opt-in rules for B2C marketing.

Here at DPN we also welcome plans to extend the soft opt-in to not-for-profits, albeit we appreciate this move is likely to have been largely driven by aims to permit this for political campaigning purposes. We would just recommend charities carefully think through any changes to current practices.

As a data protection consultant since 2015, Philippa advises a broad range of clients and delivers data protection training. She regularly writes GDPR guidance to support privacy teams in their day-to-day work.

Copyright DPN
The information provided and opinions expressed in our content represent the views of the Data Protection Network and our contributors. They do not constitute legal advice.

ICO direct marketing guidance for email and other electronic mail

October 2022

The rules and regulatory expectations spelt out

The ICO has published guidance specifically outlining the rules for direct marketing using electronic mail. The guidance clarifies the position the regulator takes on consent, the soft opt-in, refer-a-friend campaigns, hosted emails, using bought-in lists and more.

The guidance specifically focuses on direct marketing by electronic mail to individuals (‘individual subscribers’). The term ‘electronic mail’ covers email, text, picture, video, voicemail, and in-app messages, as well as sending people direct private messages via social media.

The rules for sending direct marketing by electronic mail are covered by the UK’s Privacy and Electronic Communications Regulations (PECR). We’re also reminded to comply with UK GDPR if we’re handling personal data.

This summary covers the core rules under PECR, as set out in the guidance, picks up on specific areas where the ICO has clarified its position and includes an occasional soupçon from me.

Where italics are used, this is text lifted from the guidance itself – so the regulator’s words not mine.

A. Core direct marketing rules and definitions

Options for electronic direct marketing messages

PECR says you can only send direct marketing by electronic mail if:

  • You have consent; or
  • you can meet all of the requirements of the ‘soft opt-in’.

I’d just stress, this means the consent of the individuals the message is target to.

Importantly it’s made clear these rules only apply to what are termed ‘individual subscribers’. It says, you can send electronic mail marketing to a corporate subscriber without needing to comply with the above requirements.

The following definitions are given:

  • Corporate subscribers are corporate bodies with separate legal status (eg companies, limited liability partnerships, Scottish partnerships).
  • Individual subscribers are people but also include some types of businesses (eg sole traders and some types of partnerships).

Another way to put this is individual subscribers are people who’ve signed up to the email service provider themselves.

I’d also just add, where you don’t have consent for business-to-business marketing – marketing to corporate subscribers – you’d be relying on Legitimate Interests under UK GDPR. Legitimate Interests is subject to a balancing test, so it’s wise to conduct a written assessment (Legitimate Interests Assessment).

What constitutes direct marketing?

The Data Protection Act 2018 defines direct marketing as: “the communication (by whatever means) of advertising or marketing material which is directed to particular individuals”. A definition which applies under PECR too.

It’s a broad definition and covers any advertising, marketing or promotion of products and services. It also includes promoting aims and ideals, so covers fundraising and campaigning.

This latest guidance says; “The definition doesn’t cover online advertising (eg advertisements placed on websites). It also doesn’t cover some types of direct marketing using social media (eg advertising messages shown on news feeds). This is even when organisations target these advertisements to a particular user of the site or platform.”

We’d point out targeted online advertising would fall under PECR rules where your using cookies and similar technologies.

For more information see: What is direct marketing?

Service messages

Messages sent for purely administrative or necessary customer service purposes are not considered direct marketing. However, if such messages include any promotional content, they’ll be considered direct marketing.

The ICO regularly issues fines where organisations have intentionally, or unintentionally, disguised marketing messages as service ones. An area I’ve written about before; Another ICO fine for a ‘service’ email deemed to be marketing.

Organisations have even been fined for sending messages asking people (who haven’t given permission or who’ve opted out) to confirm their marketing preferences. This in itself is judged to be direct marketing.

Solicited messages

If a customer specifically asks for information about your products and services, responding with the information requested will be considered a solicited message and won’t fall under the definition of direct marketing.

B. What constitutes valid consent?

There are specific requirements which the ICO says must be met for consent to be valid.

  • you must give people a free choice to consent so that they can refuse without detriment and you must keep the consent separate from other things, such as terms and conditions (‘freely given’);
  • you must make it clear that the consent covers your electronic mail marketing messages and you must give your name in the consent request (‘specific and informed’);
  • you must have no doubt that they are consenting to your electronic mail marketing messages (unambiguous indication); and
  • they must take a positive action to consent, so you must not use pre-ticked opt-in boxes, silence or inactivity as an indicator of consent (clear affirmative action).

You should keep a record of the consent (e.g. who, when, how) so that you can demonstrate that it is valid. People can also withdraw consent and you must make it easy for people to do this.

For more information see: How do we use consent?

At DPN we’d recommend any permission statement also includes a clear link to your privacy notice. This is so you can be confident you meet UK GDPR requirements to provide privacy information when personal data is collected.

C. Using the soft opt-in

The guidance reiterates all of the following conditions must be met to compliantly rely on this exemption to consent.

  • You want to send marketing by electronic mail to individual subscribers (includes sole traders and some types of partnerships).
  • You collected their contact details directly from them
  • You collected their details during a sale, or negotiations for a sale, or your products and services
  • You want to use their details to send them marketing about your similar products and services
  • You gave them a clear, simple way to opt-out, or say no to your marketing, when you collected their details
  • You give them a clear, simple way to opt-out, or change their mind about your marketing, in each message you send.

Just to be very clear on the fifth point, you must tell people you want to send them marketing, and give them the ability to say no.

What constitutes a ‘sale’?

Currently, the soft opt-in under PECR specifically uses the word “sale” and refers to “products and services”. The ICO says this means the soft opt-in doesn’t apply to details collected where there’s no sale (or such a negotiation), or where there are no products or services involved.

For “negotiations for a sale” to be triggered the ICO says the customer must actively express an interest in buying your products or services. Examples given include:

  • A request for a quote
  • Specifically asking for more details about what you offer
  • Signing up for a free trial

The ICO says: The communication from the person must involve buying products or services. It’s not enough for someone to send any type of query.

What about other companies in the same group?

The ICO considers use of the soft opt-in to be only available to the same entity or single organisation that originally collected the contact details. It says this means it won’t apply to other companies within the same group as the collecting organisation.

Charities and the soft opt-in

The way it’s worded in PECR means the soft opt-in only currently applies to commercial marketing of products and services. The ICO says this does not apply to the promotion of aims and ideals, for example campaigning or fundraising.

However, it could potentially apply to any commercial services or products offered. For example, if a charity has an online shop, they could use the soft opt-in to send direct marketing emails about the shop’s products, assuming all other conditions are met. In other words, the marketing could only be about products, not fundraising.

Under UK Government plans to reform data protection law and PECR it’s been proposed the soft opt-in should be extended to cover charities and political campaigning. (At time of writing, with the current political turmoil, the future direction of the Data Protection and Digital Information Bill is not known).

For more information see: How do we use soft opt-in?

An important point to highlight here, if you’re using the soft opt-in, you’ll be relying on Legitimate Interests as your lawful basis to process personal data for this activity under UK GDPR. This would therefore be subject to a balancing test – a Legitimate Interests Assessment. This is covered in the guidance under: What else do we need to consider?

D. Hosted email campaigns

The guidance doesn’t use the term ‘hosted’ email campaigns, but mentions how both the sender and the instigator of direct marketing by electronic mail will be responsible for complying with PECR.

It says you’re likely to be instigating if you; encourage, incite, incentivise or ask someone else to send electronic mail containing your direct marketing message.

We can take from this that if you ask another company to send your marketing messages to their customers, or you send a third-party’s marketing to your customers, the rules under PECR will apply.

The ICO doesn’t spell it out, but it’s clear it would not be possible to meet the conditions of the soft- in, and therefore consent would be required.

For more information see: Who is responsible?

It’s not unusual for companies to include an element of third-party marketing within their email campaigns, where this is perhaps not the main purpose. For example a travel company might include details of hire car companies within its own marketing messages.

The ICO has previously issued a fine to the Brexit Leave Campaign for including a promotion for an insurance company. In this case the promotion was totally unrelated to the content people might have expected to receive.

Where third-party content is incidental and relevant to the product or service, people are less likely to complain. Some companies may choose to take a risk-based approach here, balancing their commercial imperatives with the arguably lower likelihood of regulator enforcement action. A stand-alone message about a third party’s products and services would carry greater risks.

We’d stress here we do not know what stance the ICO would take should a complaint arise about a campaign which included some relevant and useful content promoting a third party.

E. Using bought-in lists

The message is clear – in order to use bought-in lists for electronic mail marketing to individual subscribers, the ICO says people must have given their consent to receive such marketing from your organisation. The ICO’s separate consent guidance states; Name any third party controllers who will rely on the consent.

For more information see: Can we use bought-in lists?

F. Viral marketing and refer-a-friend

The ICO says you must comply with the PECR rules if you engage in viral marketing, ‘refer a friend’ or ‘tell a friend campaigns. It’s stated: This applies even if you don’t send the messages yourself, but instead instigate the sending or forwarding of these messages.

For the Regulator to consider you the ‘instigator’, just encouraging someone to send or forward the message is enough.

Essentially the ICO says encouraging customers to forward your emails or texts is a non-starter. You don’t have consent from the recipients, and you can’t rely on the soft opt-in.

However, the ICO says you can take steps to avoid being an instigator, such as:

  • Don’t create pre-populated emails for marketing which customers can send their friends and family
  • Avoid actively encouraging customers to forward on an email or text. (If they do it without being encouraged to, the PECR rules wouldn’t apply).

An example is given of a customer logging into their account which includes information about a rewards scheme for friends and family. This explains, if friends or family input the customer’s unique code when signing up to the company’s services, the customer will get a discount on their bill. The ICO says this approach would be okay.

The guidance doesn’t cover viral marketing via social media. We’re presuming the rules would only apply if you sent this as a private message encouraging people to forward it, as opposed to posting something let’s say on a forum.

For more information see: Can we ask people to send our electronic mail marketing?

G. Using publicly available contact details

The ICO says it’s unlikely you can use contact details sourced indirectly from social media accounts, websites or other online or offline sources for electronic marketing. The reason being you can’t comply with PECR as you won’t have their consent and can’t rely on the soft opt-in.

The guidance makes it clear, an exception would be where this is business contact details, where the requirement for consent or soft opt-in doesn’t apply. (We take this to mean ‘corporate subscribers’).

For more information see: Can we use publicly available contact details to send marketing by electronic mail?

The above is a summary of the guidance and we’d encourage you to read the full guidance, or at least any areas specifically relevant to your organisation. In saying this, I’d recommend not taking aspects of the guidance in isolation. If you’re relying on consent, read the ICO’s consent guidance. If you are relying on soft opt-in read guidance on legitimate interests.

I’d also highly recommend making sure you have tailored marketing guidance (or a policy) for employees (and/or your marketing agency). Training for specific teams is also likely to improve awareness and knowledge. A great way to prevent unnecessary mistakes.

Relevant teams should understand the rules and your internal approach. It’s clear in recent PECR fines the ICO sometimes discovers there is insufficient guidance given to staff.

Alongside this guidance on electronic marketing mail, the ICO has also published guidance on live telemarketing.

I think we can take from these specific pieces of guidance the Direct Marketing Code of Practice has been pushed further into the long grass. The draft consultation published back in 2020 is clearly on the backburner, perhaps until there’s a clearer picture of what is, or isn’t happening, with UK data reform?

As a data protection consultant since 2015, Philippa advises a broad range of clients and delivers data protection training. She regularly writes GDPR guidance to support privacy teams in their day-to-day work.

Copyright DPN
The information provided and opinions expressed in our content represent the views of the Data Protection Network and our contributors. They do not constitute legal advice.

Is your marketing profiling lawful, fair and transparent?

October 2022

ICO fines catalogue retailer £1.35 million for ‘invisible processing’

Many companies want to know their customers better. This is not a bad thing. Information gathered about people is regularly used for a variety of activities including improving products and services, personalisation or making sure marketing campaigns are better targeted.

However, the significant fine dished out to catalogue retailer Easylife highlights why companies need to be transparent about what they do, have a robust lawful basis, be careful about making assumptions about people and take special care with special category data.

It also shows how profiling is not limited to the realms of online tracking and the adtech ecosystem, it can be a simpler activity.

What did the catalogue retailer do?

Easylife had what were termed ‘trigger products’ in its Health Club catalogue. If a customer purchased a certain product, it triggered a marketing call to the individual to try and sell other related products. This was done using a third-party call centre.

Using previous transactions to tailor future marketing is not an unusual marketing tactic, often referred to as ‘NBA – Next Best Action’. The key in this case is Easylife inferred customers were likely to have certain health conditions based on their purchase of trigger products.

For example, if a customer bought a product which could be associated with arthritis, this triggered a telemarketing call to try and sell other products popular with arthritis sufferers – such as glucosamine and bio-magnetic joint patches.

Data relating to medical conditions, whether provided by the individual or inferred from other data, is classified as special category data under data protection law and handling this type of data requires special conditions to be met.

The ICO’s ruling

To summarise the ICO’s enforcement notice Easylife was found have failed to:

  • have a valid lawful basis for processing
  • meet the need to have an additional condition for processing special category data
  • be transparent about its profiling of customers

It was found to have conducted ‘invisible processing’ of 145,000 customers.

There were no complaints raised about this activity; it only came to light due to a separate ICO investigation into contraventions of the telemarketing rules. The ICO says it wasn’t surprised no one had complained, as people just wouldn’t have been aware this profiling was happening, due to the lack of transparency.

It just goes to show ICO fines don’t always arise as a result of individuals raising complaints.

Key findings

Easylife argued it was just processing transactional data. The ICO ruled when this transactional data was used to influence its telemarketing decisions, it constituted profiling.

The ICO said while data on customer purchases constituted personal data, when this was used to make inferences about health conditions, this became the processing of special category data. The ICO said this was regardless of the statistical confidence Easylife had in the profiling it had conducted.

Easylife claimed it was relying on the lawful basis of Legitimate Interests. However, the Legitimate Interests Assessment (LIA) the company provided to the ICO during its investigation actually related to a previous activity, in which health related data wasn’t used.

When processing special category data organisations need to make sure they not only have a lawful basis, but also comply with Article 9 of UK GDPR.

The ICO advised the appropriate basis for handling this special category data was with the explicit consent of customers. In other words legitimate interests was not an appropriate basis to use.

Easylife was found to have no lawful basis, nor a condition under Article 9.

It was ruled there was a lack of transparency; customers hadn’t been informed profiling was taking place. Easylife’s privacy notice was found to have a ‘small section’ which stated how personal data would be used. This included the following:

*Keep you informed about the status of your orders and provide updates or information about associated products or additional products, services, or promotions that might be of interest to you.
*Improve and develop the products or services we offer by analysing your information.

This was ruled inadequate and Easylife was found to have failed to give enough information about the purposes for processing and the lawful bases for processing.

The ICO’s enforcement notice points out it would have expected a Data Protection Impact Assessment to have been conducted for for the profiling of special category data. This had not been done.

The Data Processing Agreement between Easylife and its processor; the third-party call centre, was also scrutinised. While it covered key requirements such as confidentiality, security, sub-contracting and termination, it failed to indicate the types of personal data being handled.

Commenting on the fine, John Edwards, UK Information Commissioner, said:

“Easylife was making assumptions about people’s medical condition based on their purchase history without their knowledge, and then peddled them a health product – that is not allowed.

The invisible use of people’s data meant that people could not understand how their data was being used and, ultimately, were not able to exercise their privacy and data protection rights. The lack of transparency, combined with the intrusive nature of the profiling, has resulted in a serious breach of people’s information rights.”

Alongside the £1.35 million fine, Easylife’s been fined a further £130,000 under PECR for making intrusive telemarketing calls to individuals registered on the Telephone Preference Service. Currently the maximum fine for contravening the marketing rules under PECR is £500,000, much lower than potential fines under DPA 2018/UK GDPR.

Update March 2023: The ICO announces reduction in GDPR fine from £1.35 million to £250,000.

6 key takeaways

1. If you are profiling your customers, try to make sure this is based on facts. Making the type of assumptions Easylife was making will always carry risks.

2. Be sure to be transparent about your activities. This doesn’t mean you have to use the precise term ‘profiling’ in your privacy notice, but the ways in which you use personal information should be clear.

3. Make sure your clearly state the lawful bases you rely upon in your privacy notice. It can be helpful and clear to link lawful bases to specific business activities.

4. If you’re processing special category data, collected directly or inferred from other data, make sure you can meet a condition under Article 9. For marketing activities the only option is explicit consent.

5. If you’re conducting profiling using special category data, carry out a DPIA.

6. Always remember the marketing rules under PECR for whatever marketing channel you’re using. For telemarketing, if you don’t have the consent of individuals, be sure to screen lists against the TPS.

As a data protection consultant since 2015, Philippa advises a broad range of clients and delivers data protection training. She regularly writes GDPR guidance to support privacy teams in their day-to-day work.

Copyright DPN
The information provided and opinions expressed in our content represent the views of the Data Protection Network and our contributors. They do not constitute legal advice.

Google Analytics: GA4 vs Universal Analytics – What will change?

July 2022

Will GA4 improve compliance?

For any users of Google Analytics, you will have started to see some messaging warning that the Universal Analytics tools will be retired in 2023 and that now is the time to migrate across to Google Analytics 4.

 What is Google Analytics 4 (GA4)? 

GA4 is a new property that helps analyse the performance of your website and app traffic and will replace Universal Google Analytics. It was first released in October 2020 although it’s only now that the campaign to migrate across has started in earnest. 

 Key components include: 

  • Event-based tracking: Universal Analytics is session-based, while GA4 is event–based. In other words, the ability to track events like button clicks, video plays, and more is built in with GA4, while this requires advanced setups in UA. This comes from the premise that page views aren’t the sole important metric.
  • Cross-device tracking: UA was built around desktop web traffic, while GA4 gives businesses visibility into the customer journeys across all of their website and apps.
  • Machine learning: GA4 uses machine learning technology to share insights and make predictions.
  • Privacy-friendly: UA data relies heavily on cookies, GA 4 does not.

Crucially, on July 1, 2023, standard Universal Analytics properties (the previous version of Google analytics) will no longer process data. You’ll be able to see your Universal Analytics reports for a period of time after July 1, 2023. This means that to have a continuous history of activity, it makes sense to move across to the new GA4 platform sooner rather than later. 

What privacy improvements have been made?

GA4 came with a set of new privacy-focused features for ticking GDPR boxes including: 

  • Data deletion mechanism. Users can now request to surgically extract certain data from the Analytics servers via a new interface. 
  • Shorter data retention period. You can now shorten the default retention period to 2 months (instead of 14 months) or add a custom limit.  
  • IP Anonymisation. GA4 doesn’t log or store IP addresses by default. They allocate an anonymous and unique user id to each record
  • First-party data cookies. Google uses first-party cookies which means they’ll still be supported by browsers
  • More data sampling. Google is doing more data sampling using AI to gain more granular analytics insights – this is more privacy friendly and uses models to investigate deeper insights
  • Consent mode. The behaviour of Google tags is managed based on user consent choices. 
  • Collecting PII. Google does not allow the collection of PII in GA4 –  this is considered a violation of Googles terms of service
  • Data sharing with other Google Products. Any linking to Google advertising products requires explicit opt-in consent and a prominent section on the privacy notice 

Is Google now compliant?

Possibly in limited circumstances. If Google anonymises the data by allocating a user id that is never referenced with any other data then we can argue the data is anonymous and therefore not subject to GDPR regulation.

In some instances, this may be the case if you are doing simple tracking and effectively treat your digital platforms as an ivory tower. In most instances, it is not!

If you are advertising and can then link the id to other data, there is the potential to identify individuals and therefore the information becomes personal data and subject to GDPR.

This means that all the usual user consent rules apply and opt-in consent is required to analyse activity.

The major difficulty for Google is that data is exported to the US where it is deemed, by the EU, that Google does not adequately protect EU personal data from US surveillance rules. 

Previously, Google relied on the Privacy Shield framework to ensure that it remained compliant. Since that has been invalidated in 2020, Google has struggled to achieve compliance and has faced a number of fines.          

In particular, Google Analytics does not have a way for:

·       Ensuring data storage within the EU

·       Choosing a preferred regional storage site

·       Notifying users of the location of their data storage and any data transfers outside of the EU

What next?

Ideally, Privacy Shield 2.0 will be introduced soon! Talks have started but they’re unlikely to be swift! The US government has been talking about making its surveillance standards “proportional” to those in place in the EU. This may not be good enough for CJEU. 

In the meantime, implement GA4 as it is more privacy-focused than Google Universal Analytics and hope that US and EU come to an agreement soon. There is a risk in using GA4 and you might want to consider using other solutions.

Julia is an experienced data protection consultant and has been advising businesses since 2016. She regularly delivers GDPR training as well as developing bespoke GDPR guidance for our clients.

Copyright DPN
The information provided and opinions expressed in our content represent the views of the Data Protection Network and our contributors. They do not constitute legal advice.

UK data reform: Direct Marketing

September 2021

What changes could be on the horizon for direct marketing?

The UK Government’s consultation on data regime reform mostly focuses on proposals to amend UK GDPR requirements, but it’s worth noting some changes for direct marketing could also be on the cards.

Changes which could be particularly significant for political parties and charities.

Marketing emails, SMS and calls are governed by the Privacy and Electronic Communications Regulations (PECR) and some tweaking of these rules is being proposed.

Furthermore, in what would be a substantial shift, political campaigning could no longer even be considered to be direct marketing.

So what’s be proposed?

Extending scope of the ‘soft opt-in’

PECR requires consent for email and SMS marketing to consumers, i.e. a positive action (such as a tick in a box) to say they’re happy to receive communications. However, commercial organisations can rely on an exemption to consent when it relates to existing customers.

This exemption, known as the ‘soft opt-in’, says email and SMS marketing messages are permitted without obtaining consent as long as the following conditions are met:

  • The contact details are collected during the course of a sale, or negotiations for a sale, of a product or service
  • An opportunity to refuse or opt-out of the marketing is given at the point of collection, and again in every subsequent communication
  • You only send marketing about your own similar products and services

At the moment not-for-profit organisations, such as political parties and charities, are not allowed to rely on this exemption and therefore must gain consent for email & SMS marketing. The Government is seeking views on whether this should be changed.

Clearly, this speaks to the difficulties organisations can face in trying to gain consent from people. The requirements necessary to make consent valid, were enhanced when GDPR came into force.

We all know from our own experience when buying products online that many commercial organisations rely on the ‘soft opt-in’, despite the Information Commissioner’s Office trying to push the message that consent is best.

To be fair, in research and testing we’ve conducted in the past, the general public perception is consent is much more open and honest. An opt-out can easily be missed and is often perceived as trying to trick people into being targeted with marketing.

But, I’m sure this move to extend permitted use of the ‘soft opt-in’ beyond the commercial uses would be very much welcomed by charities and political parties.

The big question though is will the public be happy with this move? A move which may also call into question the definition of ‘sale’ or ‘negotiations for a sale’. Would this only be permitted in certain situations where, for example, people had donated to a charity or political party or had purchased merchandise?

just to clarify the PECR rules on consent and the soft opt-in do not apply in the context of B2B marketing, where for example you are contacting individuals at their business email address. However, when relying on legitimate interests rather than consent you still need to fulfil transparency requirements and honour the right to object to direct marketing.

Removing political campaigning from ‘direct marketing’ rules

Another idea put forward in the consultation is to take things a step further for political parties…

Currently, political campaigning is included within the interpretation of the definition of direct marketing. The draft Direct Marketing Code states:

The DPA 2018 and PECR do not clarify what is meant by ‘advertising or marketing material’. However it is interpreted widely and covers any advertising or marketing material, not just commercial marketing. For example it includes the promotion of aims and ideals as well as advertising goods or services. This wide interpretation acknowledges that unwanted, and in some cases nuisance, direct marketing is not always limited to commercial marketing.

It’s pointed out in the Government’s consultation that case law has established communications from political parties which promote ‘aims and ideals’ should be classed as direct marketing and are therefore subject to the PECR rules.

The Government says this has never been debated in Parliament. I’d suggest this is just as well, as to my mind they’d have a skewed view!

The consultation is therefore being used to seek views on whether electronic communications from political parties and other political entities should be subject to the same direct marketing rules as other organisations and businesses.

Examples of ‘other political entities’ are given as ‘candidates and third-party campaign groups registered with the Electoral Commission’.

The Government believes relaxing the rules would give organisations more freedom to engage with prospective voters and this could lead to increased voter turnout.

However, it’s accepted people may not wish to receive electronic communications of this nature in the same way as not wanting to receive commercial marketing.

We’ll have to wait and see what views the consultation elicits on this.

Increased fines for breaking the marketing rules

The Government is proposing to raise fines under PECR, which are currently limited to a maximum of £500,000, to be in line with UK GDPR fines.

This would be a significant rise as the UK GDPR and DPA 2018 set a maximum fine of £17.5 million or 4% of annual global turnover – whichever is greater – for contravening the rules.

I suspect this is an element of the reform which will go through – so a clear warning for nuisance spammers, who seem to be the most common recipients of fines under PECR at this time.

What next?

For the time being nothing is carved in stone, and it will be interesting to see how things develop after the consultation closes on 19th November.
What’s clear is this has probably put the long-awaited final version of the current draft Direct Marketing Code of Practice, published in January 2020, on ice for a little longer.

Your views

If you would like to share you views on the above proposed changes, and other proposals in the UK data reform consultation take part in our survey.  The DPN will be submitting a formal response to the consultation, and we’d appreciate your thoughts.

As a data protection consultant since 2015, Philippa advises a broad range of clients and delivers data protection training. She regularly writes GDPR guidance to support privacy teams in their day-to-day work.

Copyright DPN
The information provided and opinions expressed in our content represent the views of the Data Protection Network and our contributors. They do not constitute legal advice.

Direct marketing: household names fined for breaking the rules

September 2021

What did We Buy Any Car, Saga and Sports Direct get wrong?

The ICO has announced a series of fines for companies which have contravened the direct marketing rules under the Privacy and Electronic Communications Regulations (PECR).

Fines amounting to £495,000 have been issued to Sports Direct, We Buy Any Car, Saga Personal Finance and Saga Services.

Contraventions include not being able to evidence valid consent, not abiding by the conditions of the ‘soft-opt in’ exemption, and emails sent via affiliates without valid consent.

In the ICO blog announcing the fines, their Head of Investigations commented:

“These companies should have known better. Today’s fines show the ICO will tackle unsolicited marketing, irrespective of whether the messages have been orchestrated by a small business or organisation, or a leading household name. The law remains the same and we hope today’s action sends out a deterrent message that members of the public must have their choices and privacy respected.”

It’s worth noting the Government’s data regime reform consultation proposes increasing the maximum fines under PECR to be in line with GDPR. So in future we could see much higher sums being levied for breaking the rules.

We Buy Any Car

Key finding: failure to meet all ‘soft opt-in’ conditions

We Buy Any Car (WBAC) has been fined £200,000 for sending 191.4 million marketing messages and 3.6 million SMS messages in contravention of the PECR rules.

WBAC came to the attention of the ICO due to complaints received directly to their online reporting tool. Between October 2019 and January 2020, the Regulator received 10 complaints from individuals, and a further two complaints from the same individual.

Much of the investigation focuses on email communications which were sent after people had requested a valuation. People can use the WBAC website to input details about their vehicles to get a valuation.

WBAC claimed it relied on the ‘soft opt-in’ exemption for such messages and said people would anticipate further email communications as part of what was described as ‘journey emails’.

The ICO found while people were informed about these communications, they were not given an opportunity to opt-out at the point their details were collected. This is one of the key conditions businesses have to meet when relying on the soft opt-in exemption.

A clear message to other businesses to assess whether they are taking any risks when relying on the ‘soft opt-in’.  Are you meeting these core conditions?

  • The contact details are collected during the course of a sale, or negotiations for a sale, of a product or service
  • An opportunity to refuse or opt-out of the marketing is given at the point of collection, and in every subsequent communication
  • You only send marketing about your own similar products and services

Saga

Key finding: inadequate consent obtain for marketing by affiliates/partners

Saga Services Limited (SSL) has been fine £150,00 for sending more than 128 million emails in contravention of the PECR rules. Saga Personal Finance (SPF) has been fined £75,000 for sending 28 million emails.

These cases focus on the potential risks when using partners or affiliates to send marketing on your behalf. Both SSL and SPF paid partners and affiliates to send promotional emails on their behalf for lead generation purposes.

The companies were relying on ‘indirect consent’. In other words they hadn’t collected people’s details directly from them, and were using other parties’ lists to promote their services.

The enforcement notice points to the ICO’s direct marketing guidance which states:

“organisations need to be aware that indirect consent will not be enough for texts, emails or automated calls. This is because the rules on electronic marketing are stricter, to reflect the more intrusive nature of electronic messages.”

The guidance goes on to say ‘indirect consent’ may be valid, but only if it is clear and specific enough. Providing an individual with a long, seemingly exhaustive list of categories of organisations that may send marketing communications to them is not likely to be sufficient.

In summary, it was found that SSL and SPF were the instigators of these email communications, and the ‘consent’ collected by affiliates and partners was not sufficient.

A lesson here for all organisations using marketing affiliates and partners, to conduct due diligence. You can’t just simply accept claims by those sending emails on your behalf that they have a ‘fully consented list’.

Sports Direct

Key finding: inability to produce evidence of marketing permissions

Sports direct has been fined £70,000 for sending 2.5 million email messages without valid consent.

The company came to the ICO’s attention after the regulator received 12 complaints via is online reporting tool.

This case focuses on a ‘re-engagement’ campaign whereby Sports Direct had identified an ‘aged dataset’ to send communications to. These were described as records which had not unsubscribed – “a category of data that showed as being opted in to receive email marketing but had not received any marketing emails”.

Sports Direct informed the ICO it was either relying on the ‘soft opt-in’ or ‘consent’ to contact this ‘aged dataset’.

However, during the ICO investigations Sports Direct could not provide sufficient evidence it had valid permission to contact people.

In one case Sports Direct couldn’t identify a lawful basis, because the customer in question had asked for their details to be erased, so they had no record at all.

This ruling acts as reminder to all organisations to keep adequate records and specifically highlights the risks of emailing customers who you haven’t been in contact with for some time.

It also confirms that, even if someone submits an erasure request, you should keep minimised but detailed enough records for a suitable period of time so you can adequately respond to any subsequent complaints.

Full details of the above enforcement action can be found on the ICO website.

As a data protection consultant since 2015, Philippa advises a broad range of clients and delivers data protection training. She regularly writes GDPR guidance to support privacy teams in their day-to-day work.

Copyright DPN
The information provided and opinions expressed in our content represent the views of the Data Protection Network and our contributors. They do not constitute legal advice.

ICO says most public sector messages are not direct marketing

August 2021

One of the unwelcome side effects of the pandemic has been the proliferation of bogus emails and texts trying to illegally elicit personal data from us.

I speak with my elderly mother almost daily, repeating the same lines; ‘don’t click on the link’, ‘don’t respond if someone is asking you to enter your details’, ‘hang up’, ‘delete it’, ‘you haven’t ordered a package, please ignore it’.

However, we’ve also all received other communications which I feel have been largely helpful. Messages such as pandemic update emails from our local councils, notifications about vaccines from our GPs, and text messages about the NHS app.

But would some of these be regarded as direct marketing messages? Did some contravene the rules under PECR (the Privacy and Electronic Communications Regulations)?

Possibly, perhaps in some cases definitely (under existing guidance). But does it matter? Surely, there’s an argument to say some communications may not be strictly necessary but are informative and useful, and don’t unduly impact on our privacy.

This is clearly an area the ICO felt needed addressing. The Regulator has issued new guidance, which appears to alter the long-standing interpretation of direct marketing.

What does the new guidance say?

The ICO says public sector organisations can send ‘promotional’ messages which would not be classed as direct marketing, if they are necessary for a public task or function.

This is significant. ‘Promotional’ messages have always been considered as ‘direct marketing’ before, regardless of whether they are sent by commercial companies, not-for-profits or the public sector.

It also means, in the eyes of the Regulator, such public sector ‘promotional’ emails, SMS messages and telephone calls do not fall within the scope of the UK’s Privacy and Electronic Communications Regulations (PECR).

In a blog announcing the new guidance the ICO states:

“Any sector or type of organisation is capable of engaging in direct marketing. However the majority of messages that public authorities send to individuals are unlikely to constitute direct marketing.”

Anthony Luhman, ICO Director, goes on to say:

“Our new guidance will help you understand how to send promotional messages in compliance with the law. Done properly the public should have trust and confidence in promotional messaging from the public sector.”

As said, until now any ‘promotional’ message was considered direct marketing. So this new guidance raises some questions:

  • Has the long-standing interpretation of the definition of direct marketing been changed?
  • Is this a sensible new interpretation?
  • Will this open the floodgates to us being spammed by public authorities?

What is the definition of ‘direct marketing’?

The definition is broad. Under section 122(5) of the DPA 2018 the term ‘direct marketing’ means “the communication (by whatever means) of advertising or marketing material which is directed to particular individuals”.

A definition which also applies for PECR.

What exactly is meant by ‘advertising or marketing material’ is not clarified in the DPA 2018 or PECR, but the long-standing interpretation of this has been that it is not limited to commercial marketing and includes any material which promotes ‘aims and ideals’.

This interpretation is clear in the ICO’s Direct Marketing Guidance and more recently in the draft Direct Marketing Code, published in January 2020, which says of directly marketing;:

“It is interpreted widely and covers any advertising or marketing material, not just commercial marketing. For example it includes the promotion of aims and ideals as well as advertising goods or services. This wide interpretation acknowledges that unwanted, and in some cases nuisance, direct marketing is not always limited to commercial marketing.”

When is a promotional public sector message not direct marketing?

In a nutshell, the new guidance states;

  • If you’re a public authority and your promotional messages are necessary for your public task or function, these messages are not direct marketing
  • If your messages by telephone, text or SMS are not direct marketing, you don’t need to comply with PECR. (But you still need to comply with UK GDPR).

The ICO is now drawing a distinction between promotional messages necessary to fulfil a public task or function, as opposed to messages from public authorities promoting services which a user pays for (such as leisure facilities) or fundraising activities. The latter would still be considered direct marketing.

The new guidance provides the following interpretation;

“In many cases public sector promotions to individuals are unlikely to count as direct marketing. This is because promotional messages that are necessary for your task or functions do not constitute direct marketing. We do not consider public functions specified by law to count as an organisation’s aims or ideals.”

This is in marked contrast to the wording of the draft Direct Marketing Code which says:

‘If, as a public body, you use marketing or advertising methods to promote your interests, you must comply with the direct marketing rules.”

What types of messages are direct marketing and which aren’t?

The following examples are given of the types of promotional content a public authority might communicate which would NOT constitute direct marketing;

  • new public services
  • online portals
  • helplines
  • guidance resources

The ICO says promotional messages likely to be classed as direct marketing include:

  • fundraising; or
  • advertising services offered on a quasi-commercial basis or for which there is a charge (unless these are service messages as part of the service to the individual)

How do you decide if messages are necessary for public task or function?

The ICO says it accepts all public authorities will have what it describes as ‘incidental powers’ to promote their services and engage with the public.
It therefore says it is not necessary for a public authority to identify an ‘explicit statutory function’ to engage with promotional activity which is deemed ‘necessary’ for a task or function.

However, the ICO does stipulate you can’t just say a direct marketing message is no longer direct marketing because the lawful basis has been stated as public task.

Nor can you just decree a promotional message is ‘in the public interest’, this won’t automatically mean it isn’t direct marketing.

What the Regulator expects is for public authorities to identify a relevant task or function for the communication they wish to send.

There’s a risk here the ICO has not been clear enough. This could cause confusion and I suspect plenty of deliberation over which messages are or are not direct marketing.

Transparency

It’s made clear that even if you determine certain promotional messages are not direct marketing, this doesn’t mean you can ignore other basic data protection principles.

You still need to make sure people know what you are doing with their personal data, and this must be within their reasonable expectations.

In other words public authorities must make it clear to people they intend to send promotional messages which are necessary for a public task or function. Which may mean updating their privacy notices.

Right to object

People have an absolute right to object to direct marketing, but they also have a general right under data protection law to object to processing, which includes when organisations are relying on the lawful basis of public task. A right people should be made aware of.

The guidance makes it clear – if someone objects to a promotional message from a public authority, it will only be possible to continue sending messages if ‘compelling legitimate grounds’ to do so can be demonstrated.

The ICO makes the point it would be difficult to justify continuing to send unwanted promotional messages if this goes against someone’s wishes.

My advice would be to include a clear ability to opt-out on any promotional message; any message which isn’t an essential service message.

(Albeit, this could cause some configuration issues for public authorities who don’t have sophisticated systems which can distinguish between different types of messages and opt-outs).

Lawful basis for promotional non-marketing messages

The ICO points to two lawful bases under UK GDPR for sending promotional messages necessary for a public task or function, either public task or consent.

The guidance suggests just because you can rely on public task, doesn’t mean you shouldn’t consider consent, which may be considered appropriate for public trust reasons.

The ICO accepts that Public Authorities may be reluctant to rely on consent, due to a potential imbalance of power, but says it may be considered appropriate if the individual has a genuine free choice to give or refuse to consent to promotional messages.

A change in interpretation

This new guidance certainly seems to represent a marked change in the ICO’s previous interpretation of direct marketing.

It’s interesting to note the following pertinent examples which are present in the draft Direct Marketing Code (which I suspect may be altered in the final version).

Example

Scenario A
A GP sends the following text message to a patient: ‘Our records show you are due for x screening, please call the surgery on 12345678 to make an appointment.’
As this is neutrally worded and relates to the patient’s care it is not a direct marketing message but rather a service message.

Scenario B
A GP sends the following text message to a patient: ‘Our flu clinic is now open. If you would like a flu vaccination please call the surgery on 12345678 to make an appointment.’

This is more likely to be considered to be direct marketing because it does not relate to the patient’s specific care but rather to a general service that is available.

It seems to me Scenario B, under the new guidance could be classed as a promotional message, but NOT direct marketing.

(Personally, I would never have complained about Scenario B, it’s a helpful, informative message and hardly in the realms of the untargeted nuisance spam).

The draft Code goes on to confirm the following would be direct marketing;

  • a GP sending text messages to patients inviting them to healthy eating event;
  • a regulator sending out emails promoting its annual report launch;
  • a local authority sending out an e-newsletter update on the work they are doing; and
  • a government body sending personally addressed post promoting a health and safety campaign they are running.

The specific examples from the draft Code were used by people to question whether some of the messages they received during the pandemic contravened PECR.

Would these types of communications now no longer be direct marketing?

It would certainly seem like they aren’t if you go by the clear message from the ICO that; ‘the majority of messages that public authorities send to individuals are unlikely to constitute direct marketing.’

Will the above examples disappear from the final Direct Marketing Code?

In summary

This new guidance is likely to be welcomed by some who have been frustrated, or indeed bewildered their communications could be considered direct marketing.

However, it could also muddy the waters. It leaves the public sector needing to clearly define different types of communications and make sure relevant teams are adequately briefed to understand the difference.

As I see there are three types of communication:

a) Service messages – essential messages relating to the provision of a service
b) Promotional messages for public task or function (which are highly likely to need an opt-out)
c) Direct marketing messages (must have an opt-out to honour the individual’s absolute right to object).

I just wonder whether the term ‘promotional messages’ could have been avoided in this guidance. I am not sure I have a satisfactory alternative, but perhaps something like ‘information messages’ – i.e. messages that are not essential service messages but provide helpful information.

I also wonder whether there could have been a carve out for important health-related messages, rather than applying this new interpretation to any ‘promotional’ message from any public authority.

Let’s hope the public sector now pays due care and attention to transparency, provides an opt-out to all but essential messages, and doesn’t abuse this new-found power to engage with us beyond what is actually necessary.

 

 

As a data protection consultant since 2015, Philippa advises a broad range of clients and delivers data protection training. She regularly writes GDPR guidance to support privacy teams in their day-to-day work.

Copyright DPN
The information provided and opinions expressed in our content represent the views of the Data Protection Network and our contributors. They do not constitute legal advice.

Marketing and the ‘soft opt-in’ – are you getting it right?

June 2021

The ICO has recently issued a £10,000 fine to a pizza company for sending ‘nuisance marketing messages’ to its customers.

Papa Johns claimed it was relying on the exemption to consent, known as the ‘soft opt-in’, but it was found to have not abided by the rules of this exemption.

So, what is the ‘soft opt-in’ and how can you use it, within its limitations, and not fall foul of the rules? What did Papa John’s get wrong?

What is the soft-opt-in?

The laws governing electronic marketing are covered in the UK’s Privacy and Electronic Communications Regulations (PECR) and these govern email, SMS and telemarketing.

Under PECR you need to have consent to send electronic marketing messages (e.g. email or SMS) to what are termed ‘individual subscribers’. These are people who personally subscribe to their email/SMS service provider (this is often referred to as B2C marketing).

But you don’t always legally need consent…

There’s an exemption under PECR for electronic marketing to existing customers. This is commonly known as the ‘soft opt-in’. An annoyingly ambiguous term as it permits the use of an ‘opt-out’ mechanism!

When relying on the ‘soft opt-in’ you need to be careful to make sure you follow the rules about when this exemption applies, which can be summarised as:

  • The contact details are collected during the course of a sale, or negotiations for a sale, of a product or service;
  • An opportunity to refuse or opt-out of the marketing is given at the point of collection, and in every subsequent communication;
  • You only send marketing about your own similar products and services; AND
  • You provide the ability to opt-out in every communication

For more information see PECR Regulation 22 and the ICO’s Guide to PECR.

It’s worth noting the rules on consent and the soft opt-in under PECR do not apply to ‘corporate subscribers’. A corporate subscriber is where the organisation (as opposed to the individual) has subscribed to the email/SMS service. (Commonly referred to as B2B marketing).

To quote the ICO on this, here’s an extract the draft Direct Marketing Code of Practice:

“The PECR rules on marketing by electronic mail (e.g. email and text messages) do not apply to corporate subscribers. This means you can send B2B direct marketing emails or texts to any corporate body. However, you must still say who you are and give a valid address for the recipients to unsubscribe from your emails.”

You do however need to be mindful sole traders and some partnerships fall under the definition of ‘individual subscribers’, so would fall under the consent / soft opt-in rules for B2C marketing.

What did Papa John’s get wrong?

The ICO says it received 15 complaints from Papa John’s customers about the unwanted marketing they were receiving by text and email. The Regulator points out, ‘the complaints noted the distress and annoyance the messages were causing’.

Subsequent ICO investigations found the pizza company sent more than 168,000 messages to its customers without valid consent.

Papa John’s claimed it was relying on the ‘soft opt in’ exemption in order to send these marketing messages. But the ICO ruled they were unable to rely on this exemption for customers who’d placed orders over the telephone, as people had not been given the opportunity to opt-out at this point. The ICO also makes the point that customers were not provided with a privacy notice.

Andy Curry, ICO Head of Investigations said:

“The law is clear and simple. When relying on the ‘soft opt in’ exemption companies must give customers a clear chance to opt-out of their marketing when they collect the customers details. Papa John’s telephone customers were not given the opportunity to refuse marketing at the point of contact, which has led to this fine.

“We will continue to take action against companies who may be gaining unfair advantage over those companies that adhere to the law and comply with electronic marketing law”.

The message is clear, you need to tell people you’d like to send them marketing and give them an opportunity to object when you collect customers’ details in order to rely on the ‘soft opt-in’. You can read more from the ICO about this case here.

This latest fine comes hot on the heels of action against another company for falling foul of PECR. A case which focused on the often fine line between a service message and a marketing one. I wrote about this here; Are your service message actually direct marketing?

Both these fines act as warnings to organisations, and provide a good opportunity to review practices and check you aren’t taken any unnecessary risks.

As a data protection consultant since 2015, Philippa advises a broad range of clients and delivers data protection training. She regularly writes GDPR guidance to support privacy teams in their day-to-day work.

Copyright DPN
The information provided and opinions expressed in our content represent the views of the Data Protection Network and our contributors. They do not constitute legal advice.

SIGN UP FOR OUR NEWSLETTER

Get DPN updates direct to your inbox. Insight, free resources, guides, events & services from DPN Associates (publishers of DPN). All our emails have an opt-out. For more information see our Privacy Statement.