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Direct Response Marketing

Facing the Regulatory Music

1 Nov, 2008 By: Thomas Haire Response

Leading legal and industry association experts discuss the current regulatory landscape in direct response marketing.

McClellan: It will be less of an issue with mobile because the Mobile Marketing Association (MMA) is trying to create standards from the beginning. The issues come quicker nowadays, and they're more complex. Using net neutrality as an example — it's a really technical issue once you pull back the layers. Behavioral advertising is another where it's not an understandable issue just on the surface. There's an interest in starting to do more self-regulation in those industries. If it gets to the regulatory agencies and the Hill, they know that they probably won't like all the outcomes of those decisions.

How would you describe the current relationship between the leading trade associations and agencies like the FTC and FCC? Are things improving, declining or generally stable? How would you like to see the relationship grow and change in the next 18-24 months?

McClellan: That relationship has been solidified. They've been astounded by the progress of the industry. The chairman of the FTC, in a number of different contexts, has used our industry as an example for others that have issues where the industry needs to go in and clean itself up. In that context, we have good relations with the FTC. There's an exchange of information on various things. Sometimes they'll ask for help in sending messages to the industry. And, in turn, when people in the industry have issues, we can go to them without directly and discuss those things. Make no mistake, when the ERA talks to the FTC, it represents the interests of the industry. The FTC recognizes that. That's not to say that having a dialogue and being able to find out what's happening for our constituency is a bad thing.

Woolley: Our goal is to build strong, solid working relationships with all regulators — not just with the FTC. But, that said, DMA's relationship with the FTC is a very good and collaborative one. The cornerstone of DMA's efforts to secure consumer trust in direct marketing is our commitment to self-regulation and, to that end, DMA believes that a strong FTC helps to distinguish the legitimate marketers from the bad ones and, thus, helps to establish trust between consumers and direct marketers. For that reason, we work closely with the FTC and commend its leaders — particularly Lydia Parnes, director of the FTC's Bureau of Consumer Protection, and Eileen Harrington, deputy director of the FTC's Bureau of Consumer Protection — for their recent fair, balanced and enlightened position regarding self-regulation and behavioral marketing. We look forward to continuing our work with the FTC, as well as other leading regulatory agencies, to ensure that all online sectors are covered by effective self-regulation.

Knowles: ERA, DMA and other trade associations have always had strong relationships with the agencies. In fact, the FTC and the FCC frequently approach the associations in order to understand the concerns of their business constituents and the industries in which they operate. The agencies and the associations mutually benefit from an open dialogue. While the two sides may not always agree, there is no reason to believe that the associations and the agencies will not continue to move forward on a friendly, cooperative basis. A new administration may necessitate some adjustments over the next year or two, but the associations are looking forward to a smooth transition.

Goldstein: The relationship between the regulatory agencies like the FTC and FCC and the leading trade associations has greatly improved in the past several years. Beginning about 10 years ago, with the consideration of the Telemarketing Sales Rule, the FTC began conducting workshops in conjunction with contemplated rulemakings or other key industry issues. These workshop formats have afforded industry the opportunity to influence guidelines and rulemaking and have generated a more collaborative spirit between the regulatory agencies and industry. As marketing activities become more sophisticated and complex — and technologically driven — it will be even more important for agencies like the FTC and FCC to collaborate with industry to ensure that any regulations that are passed are properly tailored to the evolving marketplace.

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