Email marketing and ecommerce: stay in line with the law

Marketing campaigns can be very effective at bringing customers to your store (or back to your store). But there are a four common mistakes that many marketers make when setting up their campaigns:

1. Collecting information without proper privacy practices

2. Sending marketing emails without consent

3. Not including an unsubscribe link 

4. Using prohibited forms of advertising

Let’s take a closer look at each one.

Collecting information without proper privacy practices

Looking to send an email to potential customers? Perhaps you’re sending a marketing survey or your latest must-have bargain. Either way, it’s important that you don’t just buy email lists or collect email addresses without telling your customers what you intend to do with them.

Psst. Break the mold and try sending a MailChimp survey instead

Privacy laws

Most countries have privacy laws. They cover what you need to tell your customers before collecting personal information such as email addresses.

One of the best-known general data protection laws in the United States is the California Online Privacy Protection Act (CalOPPA). Any website or online service that collects or processes California residents’ data is covered by this law.

To meet CalOPPA standards, the operator is required to “conspicuously post its Privacy Policy on its website, or… make that policy available”. There are also particular clauses that need to be included in the policy, such as how customers find out about changes to the policy, and how a Do-Not-Track request is respected.

The law is much more extensive in the European Union. Information must not be retained longer than necessary, and it can only be gathered for stated legal purposes. This applies to businesses based inside the European Union that are collecting EU citizens’ data. Also, collected information must not be transferred to any country outside of the EU which the European Commission has deemed unable to provide “adequate” protection of that information.

In the future, EU law will be even stricter in the form of the EU General Data Protection Regulation. This new regulation will apply additional requirements for notifying people who’ve had their data collected. It will apply to all operators of data collection services who collect the data of EU citizens, not just operators located or operating within the EU.

The best way to ensure that your customers have seen and agreed to your Privacy Policy is to use a clickwrap method. This is where you insert an “I agree” checkbox or button, which the customer must click to indicate agreement before they can create an account or make a purchase.

Take a look at this example from Redmart:

Note that Redmart has links to both their Terms of Use and Privacy Policy in the “I agree” text. This is sufficient to give your customers reasonable notice of your terms.

The next thing to consider is whether you have specific permission to send marketing emails or similar content. If your Privacy Policy says that you are collecting email addresses, but does not specify marketing as a reason for that collection, then you’re using their information illegally.

Here’s how Nestlé covers marketing emails in their Privacy Policy, under the section Why Nestlé collects personal data and how it uses it:

Once you’ve legally collected a customer’s email address—clearly disclosing that you plan to use it for marketing purposes—you’ll need to ensure that you comply with anti-spam laws.

Anti-spam law

In the US, the main anti-spam law is called CAN-SPAM. The Federal Trade Commission (FTC) enforces CAN-SPAM, which stands for Controlling the Assault of Non-Solicited Pornography And Marketing Act of 2003.

The CAN-SPAM law has several regulatory standards and requirements for sending commercial emails:

• No misleading header information

• No deceptive subject lines

• Identify message as an advertisement

• Include a valid physical postal address

• Include opt-out information

• Honor opt-out requests

• Monitor parties sending emails on your behalf and make sure they comply with the law

In the EU, the Privacy and Electronic Communication Directive covers anti-spam laws. The UK has implemented this Directive in their national laws in the Privacy and Electronic Communications (EC Directive) Regulations 2003, which covers the rules to follow when sending marketing emails.

When sending marketing emails to non-customers, you must allow them the opportunity to opt in explicitly. UK law also lets you use what is called a soft opt-in for existing customers. This allows you to treat a customer as if they have consented to receiving marketing emails from you, even though they haven’t. To do this, you need to

• obtain their email address “in the course of the sale of negotiations for the sale of a product or service”, meaning that the person is already a customer;

• only email them with regard to similar products and services; and

• give them a way to refuse the use of their contact details at the time they initially provide them.

UK law also requires that you allow the recipients of your messages to opt out. This opt-out option must be easily visible and displayed on every email.

Unsubscribe links

Not including an unsubscribe link is one of the most common mistakes in email marketing. It’s easy to include a link and if you don’t, you can be subject to large fines and penalties. Remember, if you send hundreds or thousands of simultaneous emails without including an unsubscribe link, each individual email could be subject to fines.

The best way to include an unsubscribe link is to place one at the bottom of every email you send out. Here’s an example from Etsy:

You can also use a link that redirects the customer to their account page with their email subscription preferences. Here’s an example from the Wellington Zoo:

Prohibited advertising

No matter how you choose to market your products via emails, make sure you don’t mislead your customers, or inadvertently use false advertising tactics. One clear example of a misleading marketing message is releasing a flyer that states “50% off anything in the store” when the sale only applies to a few items.

Another commonly-used sales tactic is to mark prices up for a few weeks, then mark them down to their original price and say that items are “on sale”. There are a number of ongoing class action lawsuits against Kohl’s and J.C. Penney for using this tactic.

Comparative advertising is also commonly used by email marketers. But despite its widespread nature, you need to ensure that you’re not accidentally using deceptive advertising practices. There are two main types of comparative advertising that are considered to be deceptive: incomplete comparison and inconsistent comparison.

Incomplete comparison involves using the words “better” or “best” without specifically listing how the product is being compared with others (such as quality or price). Inconsistent comparison is where a product is compared with others, but only in categories where the product excels (e.g., saying that the product is the cheapest, but not mentioning that it provides fewer features).

These methods are illegal in most countries. Remember to check your advertisements carefully, or else you could be open to penalties from regulatory bodies.

Ensure that your advertisements always include an accurate price. Don’t use deceptive sales tactics, and carefully check wording in comparative advertisements.

The takeaway

Email marketing is a great way to grow your ecommerce business and consolidate your customer base. Just make sure you follow the law while doing so.

That means adhering to privacy and anti-spam laws, making sure you include an unsubscribe link in all of your email marketing, and staying clear of deceptive advertising tactics. Because you want the content of your emails to hook your audience, not leave you on the hook for a hefty fine.