FCC adopts lead generation rules to protect consumer privacy
The new rules aim to protect consumers from scam communications perpetuated by robocalls and robotexts and give consumers the ability to choose which companies can contact them.
The Federal Communications Commission adopted rules for the Telephone Consumer Protection Act that aim to protect consumers against robocalls and robotexts from lead generation and comparison shopping websites and give consumers the ability to choose which businesses can contact them.
However, some argue that legitimate businesses would be hurt because their ability to use texts and automated calls will be curtailed.
The rules, adopted Dec. 13, aim to combat robotext sources by enabling the FCC to "red flag" numbers that violate the rules by requiring mobile carriers to block texts from the violating numbers. The FCC also made it illegal for businesses to send marketing texts to consumers on the Do-Not-Call list.
The FCC also approved rules to close the so-called lead generator loophole by giving consumers a way to clearly express consent when choosing which businesses have permission to contact them on behalf of a specific service.
Under the new rules, lead generators and comparison shopping websites can only share consumer contact information after the consumer has selected the business and its specific service from the list of businesses provided. After the consumer submits their selections, then only those specific businesses can contact the consumer on behalf of the services listed in the submission form.
Switching to social media
Some of those who back the new FCC approach say that in response to the new rules, businesses will redirect their outreach away from automated calls and texts, instead conducting marketing with email, messaging apps and social media platforms.
The move seems like "a necessary switch anyway for a lot of marketers since Gen Z doesn't like talking on the phone," according to Daniel Castro, vice president of the Information Technology and Innovation Foundation.
It also motivates marketers to "get back to the basics" and push for more "real personalization" because it further incentivizes companies to win consumers through successful branding so that consumers will choose them from a referral list, according to Michelle Tilton, vice president of marketing at Gryphon.ai, an AI platform for call center compliance.
"Now we have to make sure that what we offer consumers is relevant to the consumer and valuable to the consumer," Tilton said.
Shifting the problem
Businesses could circumvent these rules that would lead to significant threat of litigation by simply changing channels and using apps like WhatsApp and Facebook Messenger, Castro said. Unfortunately, bad actors who want to exploit consumer information could use these tactics as well.
"Their question is simply, 'How do we avoid getting sued over our business practices?'" Castro said.
Meanwhile, critics say scammers will likely disregard the FCC's new rules. The rules will instead have a greater negative effect on well-meaning businesses.
"Legitimate businesses seeking to do above-board and respectful work will be most impacted," Constellation Research analyst Liz Miller said. "Bad actors will still call. This update to the TCPA will do little to curb the calls most of us loathe."
Possible pain for small businesses
Tilton also said she predicts that small businesses still using auto dialers that can't pay for an in-house lead generation or marketing team will be most affected.
"Because they're not going to do niche national advertising or even local or regional advertising, they just can't afford it," Tilton said.
For example, in the health insurance market, many independent agents rely on leads that they can buy to build their book of business.
Now we have to make sure that what we offer consumers is relevant to the consumer and valuable to the consumer.
Michelle Tilton, vice president of marketingGryphon.ai
"If they're using an auto dialer, they do have to go and get express permission for themselves specifically to be able to call," Tilton said.
According to Castro, the FCC's new rule requiring businesses using lead generators to first get express permission from consumers via an opt-in submission that lists individual businesses and their offerings, will block many businesses from connecting with customers using standard lead generation techniques.
"Saying that you have to opt in to every service provider directly gets in the way of how so many of these local small businesses find their customers. So I think it is a problem," Castro said.
However, he said agrees with the FCC's goal to give consumers more control over what businesses have access to their information when interacting with lead generation and comparison shopping websites.
"If consumers are signing up for a roofer, they shouldn't be getting calls from electricians. It has to be related to the service the consumer is looking for," Castro said. "I think that's perfectly reasonable."
