As of July 2014, B2B email marketers will be faced with serious challenges when it comes to communication with potential clients. Get a head start on finding a workaround for this change.

Canada’s new Anti-Spam legislation (CASL) takes effect July 1, 2014. It presents marketers with a significant problem: violations by an individual can bring up to $1M in penalties, and by a company? Up to $10M.

I should first note that I’m not a lawyer and this is not legal advice. You may need to speak with counsel to get a real understanding of how the Canadian Anti-Spam Law will affect you (one more way in which small business in Canada are being punished, but that diatribe will wait for another post).

If you are using the Sitecore Digital Marketing System to manage your engagement plans and you send emails to Canadians, skip down to problem #3 to see how CASL applies to you.

The intention and the law

CASL has noble intentions: it’s designed to stem the tide of spam and prohibit phishing, malware and the other irritations of the internet age.  While there are many sides to this discussion, this post focuses on the prohibition against sending commercial electronic messages without the recipient’s permission as they apply to B2B organizations.

You can see a nice summary of the law and regulations here. Key elements include:

  • A prohibition against sending a commercial electronic message email to anyone unless you can prove that they gave you permission (verbally, electronically, on papyrus) with a handful of very strict exceptions.
  • Your emails must include defined content, including an unsubscribe mechanism and contact information.
  • Exceptions are made for, among other things:
    - Businesses with ongoing business relationships (which has been narrowly defined)
    - You can send one (one!) email to a person if you have been referred to this person and you list the name of the person giving the referral in the email.
    - The email address has been published without a commentary saying “don’t email me.”
    - An employee of one organization can send an email to the employee of another organization if the two firms “have a relationship at the time” and the     message “concerns the activities of the organizations.”
    - The recipient requested specific information or you are providing factual information about an ongoing purchase or warranty.
  • After a transition period, the law enables individuals to seek compensation from firms that breach the regulation; queue salivation by class action lawyers.

Problems, headaches and the unknown

For the B2B marketer with clients or prospects in Canada, CASL presents immediate, and to a large extent, unquantifiable risks.  Almost all of these risks stem from under-defined terminology in regulations accompanied by the Canadian Radio and Telecommunications Commission’s peculiar non-binding guidelines. Let’s take a look at a few of these:

Problem #1 – the definition of a commercial electronic message (CEM)

An email is considered a CEM if it is “reasonable to conclude that the purpose or one of the purposes of the message is to encourage participation in a commercial activity.”

So, you may be asking yourself, what’s a “commercial activity?”  By law, a message includes commercial activity if it includes:

  • An  offer to sell, barter, or lease a product, service or land,
  • Any advertisement for a product, service or chunk of land,
  • Promotes a person who sells, buys, barters, leases or otherwise does anything for which they get paid and
  • Anything else that might be reasonably deemed “commercial.”

And, just so that we’re all clear, the condemned encouragement of commercial activity can happen:

  •  In the email itself,
  • On any page to which the email links, or
  • In the contact information included.

The Muddy, Muddy Waters for B2B Marketers

I suspect only expensive and painful legal action is going to answer this question – but which of the following do you believe constitute Commercial Electronic Messages?

Onboarding

When a new person joins your major client, your firm automatically sends an email welcoming them aboard and introducing your firm. It includes the name and title of their new Account Manager. Is it reasonable to conclude that this email is promoting commercial activity?  Well, there’s no offer to sell or lease or barter, but the account manager’s job is to service the account and their contact info is in there so, maybe? No? Yes?

Webinars

Your firm is putting on a series of webinars that provide attendees with valuable information on how the marketing is changing in the resource sector. The marketing team purchases a list of all Directors of Marketing in Western Canada in the oil and gas sector and sends them an invitation. Is this email promoting a commercial activity?  Well, not directly. The webinar is informational after all, but I’m guessing you’re not doing these webinars for your health. The long term intent is a sale.  So…maybe?

Conference attendees

Your president speaks at an industry conference and promises to give attendees access to more detailed research supporting his talk. Your marketing team gets the attendee list from the conference organizer and you send an email with a link to the report. Are you off-side? You’re not charging for the report, but the underlying intent is to introduce your firm to these people with the hope that they will eventually purchase your product or service. So, probably not, but maybe? What if you require that those downloading the report post a tweet or “Like” the document before they can download it? Does that move the needle into “commercial activity”? Um….. maybe?

The CRTC helpfully tells us that “Whether a message constitutes a CEM and/or whether a particular exception or exclusion applies must be determined on a case-by-case basis in light of the specific circumstances of a given situation.”  Which is buerocratease for:

“Maybe”

Problem #2 -  the definition of a business relationship

The regulations helpfully allow for “implied consent” to send emails if the recipient has purchased from your firm in the last two years or made an inquiry in the last six months (this requirement gains force after a three year transition period).  I suspect you can already see the challenges this poses to the B2B marketer:

  • What do you do if your firm sells a product with long replacement cycles? Perhaps you are selling industrial machinery.  These probably last a longer than two years (unless you are a terrible, terrible company).  Let’s assume they have a 5 year life span:  CASL helpfully gags you – prohibiting you from soliciting new sales to existing customers via email – as their need for your product increases. You can plague them with emails for exactly 730 days and then you have go silent.
  • What if your sales cycle is longer than 6 months? B2B sales often involve complex, large dollar value deals. In these cases, it is not uncommon for the time from first inquiry to actual sale to stretch 18 month. CASL allows you to nurture the contact for the first six months of the sales cycle – but then gags you during the deeper consideration phases of the sale.
  • Startups, the chicken and the egg:  You are an entrepreneur starting a new firm. You have no clients, hence no business relationships. You want clients. CASL doesn’t let you send emails to prospects until you have a business relationship, so you can’t get clients and establish the business relationships that allow you to send emails.  Still want to be an entrepreneur?

Problem #3 –  the definition of employees at two firms having a “relationship”

It’s possible that CASL actually allows an employee at one company to send an email to an employee at another company, but only if a relationship exists and if the email concerns the activities of the organization. Note: that it requires a relationship, not a business relationship.

Not that relationship is defined; that’s the problem. Again, I suspect years of legal tap dancing will be required to clarify whether the following examples violate CASL:

The situation: Your firm regularly monitors traffic to your website. Your sales team notes a spike in traffic from a mid-sized Canadian firm that falls in your target market but to whom you have never sold. A particularly creative sales person finds the name and email address of the VP of Marketing for the firm – your potential buyer. She sends them an introductory email offering a product demonstration and noting that you are offering discount pricing until the end of the year. Do you pass go or do you go to jail?

The concerns:
  • The email is clearly commercial, so that puts you in the warm embrace of CASL.
  • Clearly there is no business relationship between your firms – they’re not an existing customer. But, does their visit to your website constitute a relationship? Um… maybe?

The situation: The sales team in your firm used to be responsible for “nurturing” prospects. Each sales person had a regular schedule of sending emails highlighting research performed by your firm to prospective customers. Recently, you purchased the Sitecore Digital Marketing System and you are now using its Engagement Plan capabilities to automate this ongoing contact with prospects. The emails that you are now sending automatically look exactly like the emails the sales team used to send by hand. Are you on the right side of CASL?


The concerns:
  • When the sale team sent the emails by hand, they may have been on the right side of the law, assuming they had some relationship with the recipient. Whatever relationship means – see above.
  • But the same email being sent by an automated system – and indistinguishable from that sent by hand – may not qualify for the exemption. The law is specific – the email must be sent by “an employee, representative, consultant or franchise.” Does an email sent automatically by the Sitecore DMS violate this? Or can you claim it was scripted by an employee?  Again, no one knows.

The Hard Question: What Should You Do?

It’s a very good question. There are no shortage of law firms lining up to provide you with advice, though almost all include caveats that much will depend on future interpretation of the regulations. Again, I’m not a lawyer, but prudent steps might include:

Geographic Considerations:

  • If you are a Canadian firm that sells internationally, segregate your international and Canadian prospects. There are exemptions that allow you to send emails to recipients in countries like the US where “comparable” anti-spam laws exist.
  • If you are an American firm sending emails to Canadian prospects and customers, get your head around how CASL differs from your CAN-SPAM legislation – this FMC slideshare can help.
  • If you are one of the firms in China, Russia, the Ukraine or Nigeria that sends endless amounts of SPAM emails to Canadians, then keep on doing exactly what you are doing.
Systems and Process Considerations:
  • Find the email lists in your organization that are being used for email marketing. This may prove much more difficult than you think and getting a complete inventory is going to take time, energy and resources.
  • Modify your CRM system so that you rigorously track:
    - Your prospect’s consent to receive emails – note the CRTC claims this needs to be done with a positive action: no pre-checked boxes.
    - The date of their most recent in bound request for information. You have 6 months to email them from that date.
    - The date of their last purchase. That’s when the clock starts ticking on your 2 year window to send them commercial emails.
  • Find a way to mandate the inclusion of required content – unsubscribe and contact information -  in all out bound communications.
  • Consider sending an email to all the names in your database asking for their permission to continue sending them email. You need to send this email before July 1, 2014 or else this email itself might be considered a violation of CASL. This puts you in a position to suspend emails to those who do not provide positive permission.

For a follow up, check out our newest CASL post: The Canadian Anti Spam Legislation: 4 things you need to know

References

The CASL Law

The Canadian Federal Government Fight Spam Website

Canadian Radio and Telecommunications Commission CASL FAQs

Industry Canada CASL Regulations

The Bennett Jones CASL website

Mcmillan’s Top 10 Things you Need to Know about CASL

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