Marketers Under Scrutiny
By Donna Loyle
Think privacy breaches are the product only of dishonorable companies? Think again.
Just in the past two years, the following companies have been hit with fines for business practices that led to consumer privacy incidents: Eli Lilly, American Pop Corn Co., Lisa Frank, Microsoft and American Student List.
Add to this list the venerable Mrs. Fields Cookies, which incurred a $100,000 fine, and giant candy-maker Hershey, whose direct division was hit with an $85,000 fine. Both were cited in February for non-compliance with the Children's Online Privacy Protection Act (COPPA).
In these two cases, the merchants' marketing departments were collecting personal information from kids visiting their Web sites without first getting parents' permission. The separate settlements represent the largest COPPA penalties awarded to date, according to the Federal Trade Commission (FTC). The settlements were announced by stern-faced FTC officials at the recent Privacy and Data Security Summit, an annual conference of chief privacy officers, held in Washington, D.C.
At this year's summit, FTC officials were out in force, speaking on panels, giving keynote addresses, and in the audience asking tough and probing questions of corporate privacy officers in attendance. The message was unmistakable: FTC officials are dead serious about enforcing federal privacy rules, and they want compliance from corporations. Period.
At this year's conference, a hot topic was how marketing departments can better work with their corporate counsels to avoid brand-damaging—and increasingly, fine-inducing—privacy breaches. Outlined below are some resources that can help marketers avoid infractions.
Guidebook: The new book "Privacy for Business: Web Sites and Email" by Stephen Cobb ($24.95, Dreva Hill, www.drevahill.com) is an excellent primer for those business executives who must deliver on corporate privacy promises.
Cobb, a senior vice president at ePrivacy Group and author of more than 20 books on information technology, offers business leaders advice on: avoiding privacy breaches within their organizations; developing online privacy practices that won't get them in hot water with regulators; understanding and complying with federal and international privacy laws; and more. This is a valuable resource guide for corporate executives and marketers who want to protect their brands and improve customer relations, while avoiding costly and embarrassing privacy incidents.