Telemarketing is sometimes misunderstood, oversimplified, and even viewed negatively. There is much more to it than the unexpected call you get from a strange number while you’re trying to enjoy dinner.
Reaching out to consumers using the phone is often an essential tool for most businesses. Getting the consumer on a phone call to respond to an inquiry or provide the necessary counsel and advice to qualify them for a product or service is not only helpful but, in some cases, a must.
Never has understanding how to appropriately conduct telemarketing operations been more important than in our current business and social environment where face-to-face interaction is often not an option.
If you’re running any sort of telemarketing campaign – outbound phone calls, voicemail drops, or text messaging – you need to understand the Telephone Consumer Protection Act (TCPA) and its regulations.
Consumers spend so much time on their cell phones that some form of telemarketing is almost unavoidable to successfully engage with customers. However, how you effectively make that contact via the phone is rapidly changing with the constant innovation in technology. What once was simple manual dialing of a phone number and a voice conversation has evolved into automatic dialing, voicemail drops, text messaging, and now video calling.
Because the telemarketing landscape has become increasingly complex, we’ve provided a checklist to help you begin to understand how you can not only reach consumers, but also protect their rights in compliance with the TCPA.
What is the TCPA?
Telemarketing has been used as a direct marketing tactic for decades, starting in the 1970s. In 1991, the Federal Communications Commission (FCC) released the TCPA in order to protect consumers from unsolicited telemarketing.
The TCPA outlines consumer rights related to automated marketing phone calls, voicemail messages, and faxes, including the creation and maintenance of the Federal Do Not Call list. It allows consumers to file lawsuits and collect damages for receiving unsolicited telemarketing calls, faxes, pre-recorded calls, and autodialed calls.
The law continues to evolve alongside changing technology and marketing tools.
Telemarketing tools defined by the TCPA
Businesses use telemarketing to make a variety of connections with consumers. Telemarketing is commonly used for outbound and inbound marketing, lead generation, and sales.
These tactics imploy specific tools for contacting consumers, which each have specific regulations set by the TCPA. These include:
Telemarketing
Calls made by advertisers/sellers that offer or market products or services to consumers.
Autodialed calls
The TCPA prohibits telemarketers from placing certain calls using an automatic telephone dialing system (“ATDS”). The U.S. Supreme Court’s recent decision in Facebook v. Duguid clarified that the definition of an ATDS is equipment that uses a random or sequential number generator to produce the called number. Recent decisions interpreting the Facebook decision have almost uniformly determined that a plaintiff must prove that the telemarketer used a random or sequential number generator to prove a TCPA violation.
Telemarketers should still exercise caution. Some courts have been more cautious and given plaintiffs multiple chances to prove the autodialer allegations.
Robocalls
A phone call that uses an autodialer system that may also deliver a pre-recorded telemarketing message.
Texts
The TCPA applies to both voice and short message service (SMS) text messages that are transmitted for marketing purposes.
The TCPA has been updated in recent years to prohibit the sending of unsolicited commercial text messages to cell phones, with limited exceptions, such as messages sent for emergency purposes.
Protecting consumers’ rights
When starting a telemarketing campaign, in addition to gaining marketing benefits for your business, you’ll need to protect the people you’ll be marketing to. We’re all consumers in some respect, and our time and privacy can be protected by following certain marketing regulations, such as those included in the TCPA.
If a consumer feels their rights were violated, and they file a lawsuit against a business under the TCPA, it is up to the business to prove it has complied with the law.
Gaining consumer consent
Consumers must give their prior express written consent to receive all autodialed and/or pre-recorded calls or texts transmitted (in some instances to cell phones and residential landlines for marketing purposes).
Consumer consent must be unambiguous. The consumer needs to receive a “clear and conspicuous disclosure” stating the following:
- They will receive future calls that deliver autodialed and/or pre-recorded telemarketing messages on behalf of a specific advertiser.
- Their consent is not a condition of purchase.
- They designate a phone number at which to be reached. There are limited exceptions to this requirement, such as calls/texts from the consumer’s cellular carrier, schools, informational notices, and healthcare-related calls.
Compliance with the E-SIGN Act allows for electronic or digital forms of signature, such as agreements gathered through email, website form, text message, telephone keypress, or voice recording.
Internet-provided written consent is commonly used to comply with this rule. It needs to include:
- Website pages that contain consumer consent language and fields.
- An associated screenshot of the consent webpage as seen by the consumer where the consumer entered the phone number and the complete data record submitted by the consumer (with time and date stamp).
- The applicable consumer IP address.
It is a best practice for advertisers to maintain each consumer’s written consent for at least four (4) years, which is the federal statute of limitations to file a lawsuit under the TCPA.
An established business relationship is not consent
In the past, advertisers could rely on an established business relationship (such as a previous purchase) to avoid having to obtain a consumer’s written consent. That exception no longer exists. Advertisers have to obtain written consumer consent, even if they previously had a business relationship with the consumer.
What if you don’t comply with the TCPA?
Businesses that don’t comply with the TCPA may face lawsuits from consumers who could seek actual damages or statutory damages ranging from $500 to $1,500 per unsolicited call or text message. If there have been multiple violations, a business may face a class-action lawsuit, resulting in significant fines.
As telemarketing campaigns are often done on a large scale, these charges can add up quickly. For example, text message marketing campaigns often involve thousands and, in some cases, even millions of text messages.
TCPA regulations continue to evolve to address technological advances and associated consumer demands and complaints.
Are you compliant with the TCPA?
As every operation is completely unique, this checklist is only meant to help you get a general understanding of the TCPA. Please review your specific situation with your legal counsel.
We can help if you would like to learn more about the TCPA or want to start a telemarketing campaign. Please contact us at info@kleinmoynihan.com or (212) 246-0900.
The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.
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This post was originally published on June 10, 2020 and updated on September 13, 2021.
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