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Sunday, August 27, 2006

STAMPING OUT MISLEADING DIRECT MAIL

When I first started writing an ethics column, my father would regularly urge me to write about a company that kept sending him letters written like bills for a magazine to which he had never subscribed.

At first, he thought that he might have forgotten that he had indicated an interest in the magazine. But it became clear to him that he had never heard of the publication, let alone tried to subscribe to it. The magazine company's sales strategy was simple -- entice him to buy the product by making him think he already wanted it.

I never wrote about the letters. I figured that if my father could figure out that he hadn't subscribed to the publication that sent them to him, there was no harm and no foul.

I was wrong.

Companies engaging in direct mail to consumers have an obligation not to mislead prospective customers. Apparently, it's a message still lost on some companies.

Recently, J.W., a reader from Baltimore, wrote to tell me that he received letters from both a magazine and a company that makes commemorative coins and other memorabilia with the words "invoice enclosed" printed on the envelope.

"Letters from both companies stated or strongly suggested I had ordered product from them and showed the amount I owed," writes J.W. "Several follow-up letters pressed the point. Of course, I had ordered nothing from either."

J.W. wonders if these were just examples of desperation in marketing, or whether they could be attempts "to capitalize on the inattention of a busy consumer." He asks if I see this as a "question of ethics."

I do. And so does the direct mail industry's trade association. On its website, the Direct Marketing Association (www.the-dma.org) clearly states that envelope copy of any direct mail efforts must be honest. Its Guidelines for Ethical Business Practice states: "Offers that are likely to be mistaken for bills, invoices, or notices from public utilities or governmental agencies should not be used."

Companies should sell their goods and services aggressively without misleading consumers.

People like my father and J.W. who would like to stop receiving direct mail offers of any kind can do so by going to the DMA's consumer website at www.dmaconsumers.org and clicking on the phrase "remove my name from those lists," which appears on the association's home page. But this step doesn't prevent companies from continuing to make misleading offers to other people.

If a consumer wants to take a stance that may change the behavior of a company that doesn't hew to its own industry standards, the right thing to do is to file a complaint with the Federal Trade Commission's Bureau of Consumer Protection. On the bottom of the FTC's homepage (www.ftc.gov) are the words "file a complaint," which link to the form and procedure.

In a perfect world, companies would follow their own codes of ethics. When they don't, consumers are right to call them to task.

15 comments:

yawningdog said...

I almost got caught in a similiar scam. I was sent an invoice for a yellow page ad for about $300 or $400. My first response was to get mad at my actual phone book sales rep for not crediting my account right. After talking with him, I realized that this was a bugos invoice - I don't even know if it is a real phone book. But the bill looked real and the amount matched my actual bill.

I noticed that the next year the same 'look like a bill but actually an advertisement' looked much less like a bill and more like an ad.

Complaining does pay off.

Anonymous said...

Jeff - I served on the DMA Ethics committee for many years. The invoice tactic is definitely a no-no. It misleads and snags many unwary people.

Other devices similar but disguised is selling an extended warranty on a car and making it look like the sender was an official designate. Crooks are
clever.

Caveat Emptor.

I should add that in all the years that I served on the committee, scams like the ones described were not from DMA members. The offenders just scoff unless the act is so flagrant that the Government can get after them.

George

Anonymous said...

Jeff:

I read your NY Times article regarding misleading mail, and I am very disturbed.

(The preceding could be read, "I am a very disturbed individual, and I happened to read a newspaper.")

If I understand your article, I can give one dollar to an organization that will then, "remove my name from those lists." And so I can, "...stop receiving direct mail offers of any kind...".

By, "those lists" do you mean the list(s) of people targeted by misleading direct marketing tactics? If, "those lists" do exist, who created them? Perhaps the same organization, (DMA) that now offers to manage the "lists" on my behalf for a fee? And why should I, (and potentially hundreds of thousands of others) pay a dollar each to remove our names from "those lists"? If we consumers want the truth, (or at least to be left in peace) we must first pay a fee?

Stop the world, I want to get off!


Charles Ferral

Jeffrey Seglin said...

Dear Mr. Ferral,

You raise a very good point about the $1 fee.

Would you mind if I posted your response on the blog so others can read it?

Best,

Jeffrey Seglin

Jeffrey Seglin said...

Sorry to bother you again. Could you also tell me where you read the column?

Best,

J.

Anonymous said...

Jeff:

I read your column in my living room.

You may post all our correspondence on, "the blog" as long as you agree to post ALL correspondence, and not to edit for content or length. I promise
to keep my missives short and I assure you profanity will not be an issue.

Additionally, I want you to comment in detail on the issue(s) I raise. ...("you raise a very good point" doesn't get it). Are you writing a newspaper column for real? Or is this just a psych experiment?

As I think about it, are the words in your column truly yours? Or is that column written by the same, "drones" that answer your e-mails? What a scoop that would be...

Regards,
Chas

P.S. It was the Charlotte Observer

Jeffrey Seglin said...

Dear Mr. Ferral,

A reader with a sense of humor!

Let me see if I can answer your e-mail in greater detail to prove I am less of a drone that you think. (No one else answers my e-mail. You're hearing from the only drone who writes the column and responds to readers here.)

>By, "those lists" do you mean the >list(s) of people targeted by
>misleading direct marketing >tactics?

By "those lists" I am referring to the mailing lists that companies buy actually, rent) from other companies selling goods and services through the mail so they can try to sell their own goods.

>If, "those lists" do exist, who >created them?

The lists are created by collecting information in databases. Everything you
subscribe to or order through the mail likely ends up on a direct mail list that many companies will then sell to other companies who think they might be able to sell to you.

>Perhaps the same organization,
>(DMA) that now offers to manage >the "lists" on my behalf for a >fee?

The DMA doesn't rent the lists or accumulate the names on the lists.
Companies do this and then rely on list brokers to sell them.

> And why should I, (and >potentially hundreds of thousands >of others) pay a dollar each to >remove our names from "those >lists"?

Here's where I was agreeing with when I wrote that "you raise a very good point." I think that the DMA as a trade organization should offer this service for free and let its members carry the cost. The alternative for you is that you can contact every magazine you subscribe to and every catalog
you buy from and ask them not to sell your name to others -- very time consuming, but it doesn't cost a dollar.

>If we consumers want the truth,
>(or at least to be left in peace) >we must first pay a fee?

Again, excellent point. I had asked where you read the column because different papers that carry it edit it differently and sometimes make a few cuts to fit it into the paper. The Charlotte Observer version doesn't seem
to be online (and I'm up in Boston where I don't get the Observer), but I wondered if it contained the information on how to contact the Federal Trade Commission about such practices? The FTC doesn't charge you to file a report
on a company.

Thanks for reading the column and taking the time to write to me and then writing again pressing me to answer you questions more fully. If I've missed anything, please let me know.

Best,

J.

Anonymous said...

I found your article "Stamp Out Misleading direct mail" in Aug 26th London Free Press quite informative and would like to tell you about an experience I am presently having of which did not bother me until the 5th Notice I received and Reiman tells me they have sent my account to the Credit and Collection Department and if not paid will have a definate affect on my credit rating.
Apparently I accepted an introductory offer of the magazine Backyard Living, the terms were that you agree to pay the subscription fee if you 'WERE DELIGHTED' with the first issue. (I don't even remember seeing the issue - God knows what was going on in my life at the time, children, grandchildren, ailing elderly parents - The last time I remember being DELIGHTED was when I had an afternoon totallying set aside for just me) I will quote from their "5th notice" - "As was clearly stated in our offer, if you not delighted with the first issue, YOU ARE TO WRITE CANCEL ON THE INVOICE AND RETURN IT TO REIMAN PUBLICATIONS" I guess I didn't send the cancel invoice.

I think this is unethical business and should be stopped. It is pure harrassment. It's only $21.38 but its more the principle of the way they conduct business - what do you think ?

Anonymous said...

Re. "Some direct mailers try to take advantage" in the Columbus Dispatch, 27 AUG 06 (online edition):

The Direct Marketing Association would seem to be the last organization to cite with regard to ethical principles. Keep in mind that federal law often follows the inability of industry associations to act in a socially responsible manner.

The federal Do Not Call registry, mentioned in this article, and the DMA's TPS list is an example. If
someone keeps smearing white shoe polish on your windshield (causing no monetary harm, only annoyance
every morning) and then a trade association of grafitti thugs asks for payment if you want to be left
alone, most people would wonder what kind of crime syndicate had arrived in town. Up until the federal do not call list, marketers could similarly annoy you
every night of the week and you had the same sort of option: you could pay a fee to the DMA to put you on their do not bother registry - the TPS.

The government now puts the fees where they belong: you, the citizen and consumer, may register for free and the marketer, the one who stands to profit from calling you, is the one who pays for the list.

...you may post my comments, but only if you post a clarification (e.g., this reply) that the Direct
Marketing Association would be sure to demand: The DMA actually does have a free option to get placed on their do-not-call list if the request is made by sending a snail mail letter or post card. Consumers have to pay a fee only if wanting the convenience of completing an online form.

But think about running an online store where the buyer's choices are to either send a hand written-letter via snail mail or to pay an extra fee to place an online order for instant automated processing. Are DMA members who run online stores really that dumb in setting up the don't-bother-me list in this manner, or are they perhaps really that smart to do it that way?

It's a smart strategy if the objective is to discourage the public from making the request --
that's called de-marketing. I suspect that a lot of consumers who Google'd to the DMA website decided not to complete the online form when they found that they
would have to pay a fee, and I suspect that a lot of people procrastinated on using the free alternative that includes the *time* cost of writing a letter,
addressing an envelope, and making a trip to the post office.

Federal legislation made it easy to get put on a don't-bother-me list while the DMA created barriers. A trade organization's strategy that resulted in federal regulation of an entire industry perhaps wasn't so smart.

Bob Owen
Texarkana, TX

Jeffrey Seglin said...

Mr. Owen is correct that it is possible to get placed on the do-not-call registry that should take your name and phone number off of lists telemarketers use. That form is at https://www.donotcall.gov/Register/Reg.aspx.

But the DMA appears to charge a dollar to get your name off of direct mail lists whether you do it via the internet or snail mail as the information states at http://www.dmaconsumers.org/cgi/offmailinglist.

Jeffrey Seglin

Tony said...

To see a review of such practices take a look at www.trickster.org.uk

Anonymous said...

Scam?
-----------------------------------

Dear ______ ______,

Thank you for requesting Taste of Home. Your order has been received, so look for your current issue in your mailbox soon.

In the meantime, please look over the attached form and verify that your name, address and order information are correct.

As you may recall, we make subscribing easy by including an invoice with the issue. But if you've already decided that Taste of Home is the type of magazine you'll enjoy, just return the above statement with your payment today. When you do, you'll guarantee that you won't miss a single, recipe-filled issue.

On behalf of the entire Taste of Home staff, we sincerely look forward to having you as part of our subcriber family!

Karen Gardner, Subcription Services

Anonymous said...

I received an INVOICE in the mail forwarded from a previous address for a magazine "Taste of Home" that I never even heard of before, telling me my payment is past due adn if they don't receive payment within 15 days my account will be turne dover to Credit and Collections. The invoice is from Reiman Publications, I think I am being scammed.

Carts said...

I recently received an invoice in the mail from Taste of Home. Date: Jan 23, 2009 Amount Due $21.18.
They said I received their magazine already and have not yet paid my invoice. I called them and they indicated that it must have been a mistake and will remove my information from the system and clear my invoice. They said I must have mailed in a stub to request their magazine. I asked that they send me a copy of the stub, as it must be fraudulent. I will wait to see if anything is to come in the mail.

Anonymous said...

I took the easy way out on this and signed up for a membership with Myjunktree and was able to stop almost all the junk mail that came to my home. I was able to make a coice of what came to my mailbox and what didn't. The good thing was I received feedback within 48 hours when the stuff was stopped. I got out of all the weekly coupons, Credit Card offers, Catalogs and misc junk mail. I was even able to stop the paper phone books. It was quick and easy to make my choices. It does take time for the mail to stop flowing in, it's a process but it did stop.