Battle for control of opt-out list

While the National Consumer Commission considers starting a registry through which South Africans can opt out of direct marketing, about 70 000 consumers have already signed up to an alternative national opt-out or “do not contact me” database.

Run by the Direct Marketing Association of South Africa, which has more than 300 members representing 95% of direct marketers in the country, the platform (nationaloptout.co.za) was created by the organisation on behalf of members in 2007. It has about 70 000 registrations and is growing by less than 0.01% each month.

Spam is more than just a nuisance; it also costs the global economy billions each year.

Millions to manage spam
An email statistics report by the Radicati Research Group in 2009 found that a typical 1 000-user organisation can spend upwards of $1.8-million a year to manage spam.

Expenses caused by virus attacks carried in junk mail could cost the organisation an additional $158 000.

Brian Mdluli, who recently resigned as chief executive of the association, said the database was created before the Consumer Commission was launched. “We created the platform before the Consumer Protection Act was enacted into law. It is a consumer protection tool that association members are committed to in terms our code of conduct and international best practice.”

Mdluli said registration was active within 30 days.

To opt out, the only mandatory detail is an identity number so the association can verify that the registering consumer is the correct person and owner of a certain data set.

“We have seen some attempts at third-party registrations from some companies that are opting out their clients and prejudicing consumers from receiving competitor messaging. It is therefore important that we verify all registrations,” Mdluli said.

Non-obligatory details that can also be submitted include residential addresses and cellphone numbers. “It is important that consumers provide us with all the data they would like marketers to suppress. The site is hosted on a secure HTTPS platform.”

Mdluli said members did not have access to the data on the registry, only to a “de-dupe” process against the list—a procedure that uses matching logic to eliminate file records that are duplicates.

Database abuse?
At the end of 2010, rumours circulated that the database had been abused. “We used to provide the database to people to clean their lists against and they would have agreed to destroy it thereafter,” said association spokesperson Alastair Tempest. “But we have never seen proof that the database was abused.”

In April last year, Tempest said, a secure database was launched so that marketers could clean their list through the “de-dupe” system at the association. Tempest said that across the world similar lists were generally run by marketing associations.

The association has since made an official submission to the Consumer Commission to manage the database free of charge on behalf of the industry.

“We do not believe that taxpayers’ funds should be used to manage compliance that should be paid for by the brands that wish to communicate with consumers,” Mdluli said.

A document on the tender was released for comment by the Consumer Commission and the final submission date was July last year. The commission is yet to announce a decision.

Other offers were submitted by Stephen Logan Incorporated, which has submitted an estimate of more than R1-million in costs, and Deloitte, which has failed to submit a breakdown of costs.

The commission did not respond to the Mail & Guardian‘s repeated requests for comment, but early last month ITWeb reported that national consumer commissioner Mamodupi Mohlala had said it was still waiting for Trade and Industry Minister Rob Davies to say whether it would get the funds it needed to build an in-house registry.

The Direct Marketing Association has been criticised for a possible conflict of interest.

“The association’s main purpose is to reach people directly and its members make money only if they do so effectively and continuously. The idea that it could run and manage an opt-out database creates all manners of conflict,” said Steven Ambrose, the managing director of Strategy Worx. “In a perfect world, this may work. However, in our current society it is highly unlikely to do so, especially when the members themselves fund the association.”

Advantages of keeping the database in-house
Keeping the database in-house, he said, reduced the chance that association members would be severely sanctioned by an independent body.

Ambrose also doubted whether the platform was very effective, in any case. “Many, if not most, spam message senders are not subscribed to the database and may have obtained your information from lists that do not subscribe to the database.”

Marketing analyst Walter Pike said the opt-out list was unlikely to be successful, because most people would probably not want to be bothered to enter their names and the balance would probably be too paranoid to do so because of fears that, by doing so, they would just appear on another list. He said an opt-in approach would be far better, because consumers could pick and choose from which organisation they would like messages.

The opt-in database, accessible from the association’s website, has more than 13 000 registrations, Mdluli said.

Spammed if you do, spammed if you don’t
Mail & Guardian readers sourced through Twitter gave mixed responses to the national opt-out database.

Most respondents who had registered said they found it only partially effective and still received spam.

Not all the details of people registered with the Direct Marketing Association had been removed from the mailing lists used by direct marketers, Julia Mihalicz said. “They contact you anyway.”

Derek Walker said that despite being on the opt-out register, he received an average of five spam emails from local businesses a day.

“Even after contacting the association about one of their members that was sending out spam, I still received it from them,” he said. “The association is toothless and if a company is not registered with it, it can do nothing to that company. We need somebody with real teeth to take on the spammers.”

Andre Proctor, who registered recently, was not concerned about the database being run by a marketing association. “It could be the best kind of policeman,” he said. “But there must be plenty of feedback opportunities. The findings must be published and the association must respond publicly and prominently to the feedback.”

Paranoia still prevails, however. “I took one look at the national opt-out web form and decided it must be a scam,” said Amelia Mulder. “Why do they require so many of your personal details? I am not about to give my address, ID, email, all phone numbers, postal and physical addresses and so on to a marketing association.”—Lisa Steyn

Lisa Steyn

Lisa Steyn

Lisa Steyn is a business reporter at the Mail & Guardian. She holds a master's degree in journalism and media studies from Wits University. Her areas of interest range from energy and mining to financial services and telecommunication. When she is not poring over annual reports, Lisa can usually be found pottering about the kitchen. Read more from Lisa Steyn

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