Out-Law Guide | 01 Feb 2006 | 9:25 am | 6 min. read
This guide covers two kinds of viral marketing by email:
There are risks with each approach. This guide explains how to minimise them.
A website may invite a visitor to recommend a particular page or product to a friend. Usually the visitor's email address is requested as well as the friend's email address. The friend then receives an email that, on arrival, looks like it was sent by the person making the recommendation – in order that it appears to come from a trusted person. This, in theory, distinguishes the email from unsolicited marketing which is more likely to cause offence or at least more likely to be deleted without being read.
There is an argument that website operators should not do this because arguably they are faking the identity of the actual sender, a practice known as 'email spoofing'. There is also an argument that the operator is sending unsolicited commercial email without prior consent. Strictly speaking, these are unlawful practices.
The general rule in relation to emailing individuals (as opposed to emailing businesses or their employees), found in the Privacy and Electronic Communications (EC Directive) Regulations 2003, is:
"…a person shall neither transmit, nor instigate the transmission of, unsolicited communications for the purposes of direct marketing by means of electronic mail unless the recipient of the electronic mail has previously notified the sender that he consents for the time being to such communications being sent by, or at the instigation of, the sender."
In practice, 'tell a friend' services are popular and unlikely to cause problems if you follow the Information Commissioner's guidance on viral marketing set out in its Guide to Privacy and Electronic Communications (62-page / 256KB PDF). Viral marketing is addressed at pages 33-34. This guidance can be summarised as follows:
The last of these points has also been raised by the UK's advertising watchdog, the Advertising Standards Authority (ASA), which administers a rulebook called the CAP Code. Breaching the CAP Code usually results in bad publicity, though sometimes the ASA applies sanctions. Any sanctions imposed will be proportionate to the breach. The ASA's focus is on amending, withdrawing or stopping any offending communications as soon as is practically possible.
In a 2009 ruling the ASA criticised a movie promotion website that invited visitors to provide friends' addresses to whom the promoter sent hoax emails. The website did not ask the person who initiated a hoax to confirm that he or she had the friend's consent. This was found to breach rule 43.4c (now rule 10.13) of the CAP Code. The rule requires 'explicit consent' of consumers when sending emails except in limited circumstances.
We would add the following tips to the Commissioner's guidance:
Our final point comes from an ASA ruling against a viral promotion that allowed emails to be sent anonymously which was found to breach rule 3.7 of the CAP Code, which says that before distributing a marketing communication for publication, "marketers must hold documentary evidence to prove all claims, whether direct or implied, that are capable of objective substantiation." (Note: The wording of rule 3.7 in the latest version of the CAP Code has been slightly amended).
We cannot guarantee that these steps will eliminate the potential legal risk. The commercial risk may be fairly low as in the event of a complaint or new guidance from the courts, the ASA or the Information Commissioner, a website can change or even abandon its 'tell a friend' services without collateral damage. For a breach of the Data Protection Act or the Privacy and Electronic Communications Regulations the Information Commissioner may however impose a fine of up to £500,000. A high commercial risk therefore exists with data collection practices: get these wrong and you build a database that may be unlawful to use – making it potentially worthless.
Please forward this email
The second type of viral marketing is where a marketer asks a person to forward an email to one or more friends. Generally these emails are harmless, provided the identity of the sender is clear.
Organisations must not seed a viral marketing campaign by asking staff to send emails that purport to come from them as independent consumers. To do so risks prosecution, a fine and a maximum prison sentence of two years under the Consumer Protection from Unfair Trading Regulations 2008.
These Regulations state that "Falsely claiming or creating the impression that the trader is not acting for purposes relating to his trade, business, craft or profession, or falsely representing oneself as a consumer" is an unfair commercial practice and is therefore illegal.
Consequently, as with any business-related email, the identity of the organisation behind the campaign should be clear.
See also the OUT-LAW Guide on the Consumer Protection from Unfair Trading Regulations.
Such forwarded emails can also fall foul of the CAP Code. The Advertising Standards Authority through CAP have issued a Help Note on Advertising Virals which may also be of assistance. It notes that viral messages that are offensive, misleading, unfair or irresponsible or might otherwise bring advertising into disrepute, will be in breach of the CAP Code. It also states: "advertising virals are not excepted from the Code merely by having originated on a website or by being forwarded-on by consumers".