Niche Info Online Business

OUT-LAW News, 18/03/2008

Some of the UK's biggest retailers are failing to fulfil their legal obligations in their email marketing, a study has found. CD WOW!, Game, Topshop and Waterstone's were amongst the companies which failed the tests set by an internet marketing consultancy.

The Companies Act of 1985 demands that business emails include a company registration number, place of registration and the registered office address of the business, but almost half of the marketing emails analysed by dotMailer failed to do so.

"This should be set out in the email footer in a clear, concise  manner," said the report by consultancy dotMailer. "Incredibly, 21 retailers in our survey did not include all of this information, therefore potentially breaking UK legislation." The company surveyed emails from 46 companies.

A new Companies Act is being introduced in stages and an updated set of regulations governing what information companies must disclose in communications was published last month. The new regulations, the Companies (Trading Disclosures) Regulations of 2008 are not materially different from those amending the 1985 Act and will come into force on 1st October.

It is these rules which require companies to include the company's details in emails, called trading disclosures. The requirements apply to limited companies and Limited Liability Partnerships. Failure to comply can result in a fine of up to £1,000 and, from October, an additional fine of £300 for each day that the contravention continues.

The 1985 Act was amended in 2007 to make it clear that business emails were subject to the law. The information must also be published on a company's website, though the rules do not apply to sole traders or standard partnerships.

DotMailer conducted an analysis of 46 retailers' email marketing and awarded each company a score out of 100. It said that TopShop, STA Travel, ASDA and M&S were the best overall performers across the 20 assessed categories, which covered aesthetic, practical and legal concerns.

The report assessed the performance of the companies against the 20 criteria. "The unsubscribe process should be as easy as possible for customers to avoid them reporting messages as spam, but many retailers are making this too hard to do," it said.

"Ideally, email landing pages should not only repeat the offer outlined in the email, but also match the look and feel of the email to reassure customers," said the report. "The survey found that just four brands had created a microsite to match the design of the email, while 40% of the retailers studied scored under 50% in this category."

The consultancy said that it was a good idea to target emails at people who have interests in the area covered by the email, but that most of the companies surveyed did not attempt sophisticated targeting, even when they had already gathered relevant customer information.

"Targeted emails generate higher open rates, but just five brands used the information given on sign up to make the content more relevant. Getting useful information from customers when they sign up is one way to achieve this – something only 15% of retailers in the study are doing, while 91% achieved less than half marks for targeting," it said.

See:

• The report (39-page / 3MB PDF) 
  
• Email notices and email footers, an OUT-LAW Guide
  
• The Government's new regulations on trading disclosures (6-page / 53KB PDF)