Virgin's email to opted-out customer broke rules, says ASA

Out-Law News | 30 Jul 2010 | 4:08 pm | 3 min. read

Virgin Media broke advertising regulations when it sent an email promoting deals and offers to a customer who had opted out of marketing communications, the advertising regulator has said. The company had claimed the message was a service update.

The advertising industry's code of self-regulation, the CAP Code, governs how companies use databases for marketing and allows customers to opt out of receiving marketing communications.

One Virgin Media customer had done just that but received a promotional email from the company.

"What great stuff could you be missing out on?” said the message's headline. "We’ve noticed you’re not currently registered to receive information from us and we just wanted to let you know that now that Virgin Mobile is part of the big Virgin Media family, you can get your hands on even more exclusive deals. All you need to do is tell us you want to hear about them!" it said.

"As a Virgin Media customer, you’ve got the chance to bag some brilliant perks, as well as extra useful stuff to help you keep on top of your services. So that you get the best value from us, we’ll keep you up to date with exclusive offers as well as making sure you’re up to speed with the latest product news," it said, going on to say that the customer would be entered into a prize draw for a phone.

Virgin said that the email was sent to inform the customer that Virgin Mobile had become part of Virgin Media, and that it was an announcement and not a marketing communication because it "contained none of the calls to action that were characteristic of such", according to a ruling from the Advertising Standards Authority (ASA).

The ASA said that the email was promotional.

"Because ... it did not include only information about the change but included prize incentives and text such as 'What great stuff could you be missing out on?', ' can get your hands on even more exclusive deals' and 'As a thank you, you'll be entered into our prize draw to win a free HTC HD2* phone ... ', we considered the e-mail was a marketing communication," said the ruling.

It said that because the message was sent without the customer's consent, Virgin had breached the CAP Code's rules on 'database practice'.

The CAP Code requires that marketers "take all necessary steps to ensure that [...] marketing communications are not sent to consumers who have asked not to receive them".  It also provides that "Consumers are entitled to have their personal information suppressed." The promotion was found to breach both provisions.

Virgin was told that the ad must not appear again in its current form. "We told Virgin to ensure they did not send marketing communications by e-mail to consumers who had asked not to receive them," said the ASA.

Virgin had argued in its defence that the Data Protection Act allowed businesses to contact customers "in infrequent situations where there had been business developments to ensure their data remained up-to-date and accurate."

Louise Townsend, a data protection law expert at Pinsent Masons, the law firm behind OUT-LAW.COM, said it was true that companies could send some communications to customers who had opted out of marketing, but that they must be careful.

"The Information Commissioner oversees breaches of the Act and his guidance does make one small concession which is to recognise that for people who have previously objected to marketing it may occasionally be helpful to tell them about something new or changes to a service as part of a business as usual communication," said Townsend.

"For example, if you introduced a newsletter or online forum or if you significantly changed the terms of a free service you offered, as part of a normal service communication you may be able to just mention this," she said. "This shouldn't, though, stray into anything with the specific intention of showing customers what they are missing."

"According to the Information Commissioner it is also acceptable to remind individuals of their ability to change their marketing preferences if the reminder forms a minor and incidental addition to a message you are sending them anyway, again you could occasionally, maybe once a year, use a service communication like an annual statement to remind customers that they may wish to review their marketing preferences and telling them how to update them," said Townsend.