Wednesday, December 2, 2009

Legal and ethical issues in marketing

We learned this week that there are a number of laws that regulate internet and interactive marketing. I asked the students to consider a scenario where a company obtained a list of mobile phone numbers in its target market and whether the company could use the list for text messages or phone calls promoting its services. We identified a number of laws that related to this issue. CAN-SPAM, requires express prior permission before sending the message and applies not only to email but to text messages that reference a domain name ( and consumers cannot be required to incur any costs for the authorization. The TCPA (Telephone Consumer Protection Act) also prohibits the use of automated equipment to place calls to a mobile number without prior consent. In addition, the Mobile Marketing Association as published Guidelines which do not have the force of law, but also suggest that the consumer should have prior notice and consent that the text message is coming. The Do-Not-Call List would also likely apply if the company chose to call these numbers. If the phone number were obtained from children under 13, the Children's Online Privacy Protection Act (COPPA) would apply. This simple scenario indicates that internet marketing law is complex and evolving. From an ethical point of view, both guidelines and laws point to the simple principle of permission. Getting permission is an easy way to know that dealings with the customer are both ethically and legally correct. In addition to protecting children, we also protect consumer healthcare (HIPPA) and financial (GLBA) information. However, there is no general right to privacy of personal data in the United States as is required by the European Union, for example. We also discussed copyright law and the fact that peer-to-peer sharing of music is illegal, even though facilitated by technology. We will have to see how the music industry evolves and adapts to these technology challenges.
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