CANADIAN MARKETERS TAKE STEPS TO FOSTER WEB COMMERCE: MEMBERS MUST HAVE CONSUMER CONSENT BEFORE SENDING E-MAIL

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Direct marketers in Canada are implementing a new interactive marketing policy that bans spam e-mail and bolsters consumer privacy on the Internet.

New rules from the Canadian Direct Marketing Association (www.cdma.org) go into effect in January 1998 and "recognize that marketing on the Internet is different" and demands different guidelines, said John Gustavson, CDMA president.

Under additions to their code of ethics, member marketers must now have consumer consent before sending marketing e-mail and must tell consumers what information is being gathered in response and how it will be used, a rule that applies to click-through data.

Consumers must also be able to remove their names from e-mail lists and easily decline to have their information collected.

Compliance with the rules is mandatory for the group's 650 corporate members, which account for 80% of Canada's $8 billion direct marketing industry. Serious or repeat policy violators will be expelled from the self-regulating association, which has overseen Canada's direct marketing industry since 1967.

LARGE DETERRENT

"That's a pretty big stick" to use against direct marketers that don't take the measures seriously, said Mr. Gustavson.

For some months now the privacy policy has been in place on a voluntary basis with several major interactive marketers, including Columbia House Canada Online (www.columbiahousecanada.com) and Sony Music Canada's Celine Dion Online (www.celineonline.com).

"We consider [the policy] a good marketing tool," said Ken Schafer, Sony Canada's director of consumer technology. "We're building [brand] loyalty around the artists. People will just leave the site if they're not happy about their privacy."

Sony's Celine Dion site receives 700,000 hits a month but only about 3% to 4% of visitors follow the link to the privacy policy from the home page, said Mr. Schafer, who wouldn't disclose the number of users. "Perhaps just knowing [the privacy policy] is there is enough for consumers to be satisfied," he added.

CONFIDENCE AT STAKE

Instance of questionable marketing prompted Canada's direct marketers to begin developing the new policy earlier this year.

At stake is consumer confidence in online marketing, said Mr. Gustavson.

"Far too often marketers were collecting and transferring information without the knowledge of consumers," he said. "We think that's fundamentally wrong-information should not be collected on the Net in a hidden fashion."

WIDESPREAD

ADOPTION EXPECTED

Non-member direct marketers aren't bound by the policy, although the industry group expects the new rules will influence others to adopt standards for online marketing.

The U.S.'s Direct Marketing Association also recently adopted rules that require members to remove from lists the names of consumers who wish not to be contacted

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