The Direct Marketing Association, reacting to episodes in which consumers are charged for products and services they never agreed to buy, has adopted guidelines governing advance consent marketing.
The guidelines will have a major impact on magazine publishers and firms selling membership clubs and continuities. They require that marketers provide clear notice and obtain advance consent before charging consumers. Notice would initially be required in renewal reminders, said Patricia Faley, the DMA’s vice president for ethics and consumer affairs. Violators will be probed by the DMA ethics committee, and could end up being expelled from the association.
Approved by the DMA board last month, the guidelines cover marketing plans for which consumers give consent to receive and pay for services they get in the future, and where they pay on a continuous or periodic basis until the consumer cancels the plan.
The DMA feels marketers should:
- Obtain the consumer’s advance informed consent to participate in any marketing plan before that consumer is billed or charged.
- Provide products or services and bills concurrently. However, consumers would not be obligated to pay bills prior to the expiration of any trial period.
- Inform consumers in the initial offer and in renewal reminders of their right to cancel participation in the plan.
- Provide renewal reminders at the frequency specified in the initial offer, and allow a reasonable length of time between receipt of renewal reminders and the renewal date, before which consumers can cancel the plan.
- Honor requests for refunds due promptly upon a consumer’s cancellation of the plan. In addition, the guidelines call for marketers to clearly and conspicuously disclose the following before obtaining the consumer’s consent:
- A description of the goods or services being offered.
- The identity of the marketers and contact information for service or cancellation.
- The interval between shipments or services to be provided.
- The price or range of prices of goods/services bought by the consumer, including whether there are any additional charges.
- Whether the consumer will be billed or automatically charged.
- The fact that the consumer must cancel in order to avoid future billing or charges.
- An easy method of cancellation.
- The time period, if any, within which the consumer must cancel.
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