Archive for November, 2012

Your Mobile App’s Privacy Policies and Terms and Conditions: What They Mean to Your Business and To Your Customers.

Tuesday, November 20th, 2012

Just because it’s mobile doesn’t mean that advertising laws and regulations don’t apply! The need for a prominent disclosure of terms and conditions and a privacy policy in mobile apps is rapidly evolving, and dealers are at risk if they are using an app that doesn’t comply.

The Federal Trade Commission (FTC) and the state of California are leading the charge when it comes to mobile app compliance; and although the law hasn’t yet caught up with such things as push notifications and location tracking, the big “push” is being put on the mobile app privacy front.

If you fail to remain compliant with in your mobile app, it can be costly. For instance, the FTC can seek civil penalties of up to $16,000 per privacy violation – measured by each consumer download – and the California attorney general is authorized to seek up to $2,500 per application download if privacy terms are not provided to California residents who download the application.

Mobile applications represent (or should) the ultimate advertising channel to provide consumers with choice. In other words, unlike a text message where consumers may not have provided prior express (and soon to be written) consent, a mobile application must be downloaded, and consumers have the choice at the device level to control how the application will perform.

In other words, with a mobile app, consumers have the choice as to whether push notifications are received and location tracking is engaged, etc. The only thing a consumer does not have direct control over is how his or her personal information is shared.

And with consumer and regulator concern being centered on the theft or misuse of personal information, privacy issues can reach far beyond the customer’s mobile device. A breach of privacy could mean losing your customers, and therefore your business.

DriverConnect, the dealer branded mobile app by DMEautomotive, is currently the only app provider that we’re aware of to prominently display privacy and other terms with in their mobile app. Upon the download of the app, the terms are displayed as a pop up – overtaking the screen. Terms are also always available in the “Tools” menu for view by the customer at any time.

It’s always important to take best practices advice directly from regulators. The FTC directs application developers and owners to tell the truth about what your application can do and don’t mislead about what it can’t do.

Always disclose key information clearly and conspicuously. That means putting the terms where consumers can see them, big enough to read and written so they can understand. Design and update the application with privacy in mind – don’t make it an afterthought—and any disclosure that would be included in a print advertisement should also be listed on an app-based advertisement.

Finally, be transparent. If you share consumer information, then say so. Tell consumers what information is collected and what is done with that information. And be sure to keep consumer information secure! Offer choices – allow consumers to opt-out of certain practices. But most importantly, honor your privacy promises.

*The information provided herein is for educational and informational purposes only and should not be construed as legal advice. Readers should always obtain the advice of independent legal counsel related to their own specific and unique circumstances.

Do you know what the FTC stands for? What about the FCC? The DNC? Or the TCPA?

Monday, November 12th, 2012

These are acronyms that your business MUST be familiar with.

The FTC is the Federal Trade Commission and its mission is to “to prevent business practices that are anticompetitive or deceptive or unfair to consumers; to enhance informed consumer choice and public understanding of the competitive process; and to accomplish this without unduly burdening legitimate business activity.” The FTC, in relevant part, regulates telemarketing and commercial email.

The FCC is the Federal Communications Commission, and it regulates telemarketing. Its regulations also allow for consumers to bring their own action.

The TCPA stands for the Telephone Consumer Protection Act – which was signed into law in 1991 and is regulated and enforced by the FCC. It specifies the rules for telemarketers, including what is required when calling a wireless device or residence.

The DNC is the “Do Not Call” list. It’s a list that organizations maintain to enforce a consumers request to be removed from marketing efforts.

So why should you care about these terms?

Because the regulators and consumer rights attorneys are cracking down, and you could be one communication away from an expensive class action lawsuit or even bankruptcy.

Companies have paid millions of dollars in civil penalties to the FTC for not acknowledging things like a customer’s request to be put on a company-specific DNC list or for transmitting deceptive Caller ID names. It is imperative that you honor your customer requests and only present the correct information on all occasions.

When it comes to direct mail, ask is the advertisement true? And can you prove it? Watch out for superlatives. Make sure you present clear and conspicuous disclosures -and in some cases special disclosures may even be required. Be careful with “free” and sweepstakes or giveaways. And remember – with direct mail it’s important to become friends with the asterisk to help consumers find the disclosures of material terms related to the offer.

Email Advertisements should not have false or misleading header information and should identify the message as an advertisement. Tell recipients where you’re located and how they can opt out if they so desire. You must honor the opt out requests promptly. And as always – monitor what others are doing on your behalf. If you fail to do any of these things you may have a CAN-SPAM problem—and be fined up to $16,000 for EACH non-compliant email.

And note: there is a new rule! You must obtain prior express WRITTEN consent to make certain communications to wireless devices and prerecorded calls to a residence.

Now there is a new technology that the law is just now catching up with: Mobile apps. This channel makes it easier to get express permission. Make sure your mobile app is applying best practices by providing accurate terms and conditions. .

Know the law or hire someone who does. Use respectable vendors that also watch out for changes in the law. Join industry trade associations and other groups. Know your state regulators and don’t be afraid to ask questions. Review your insurance policies. Are you protected from advertising injury? Why not?

*The information provided herein is for educational and informational purposes only and should not be construed as legal advice. Readers should always obtain the advice of independent legal counsel related to state and federal law applications to specific and unique circumstances.