Viral marketing, refer a friend, tell a friend, friend get friend…whatever you call it, ever since NZ’s Anti-Spam Law came in to effect back in 2007, it’s one area which has a been constant cause of confusion and trepidation among marketers. Despite the fact that we frequently see them in practice, it seems few are really clear on exactly what’s legal and what constitutes best practice.

For anyone not yet familiar with the UEM Act, the DIA (the Department of Internal Affairs who are charged with enforcing the Act) provides an explanation in plain english of what it means for email senders, answering many frequently asked questions on their website.

The law is pretty clear about how it defines spam – that is any electronic commercial message which is sent without the consent of the recipient. An electronic message could be an SMS or MMS, an instant message or of course, an email. Sounds straight forward enough, right? But what constitutes consent? Well the Act allows for several different forms:

1. Express consent – When a recipient has explicitly and actively agreed to receive emails from a sender. Usually this takes the form of an ‘opt-in’ checkbox on a subscription form and is the most robust form of consent. As an email marketing provider, this is the kind of consent we want all of our clients to obtain because it minimises the likelihood of complaints and results in a better quality, more engaged list of recipients.
2. Inferred consent – When a business has an existing relationship with a customer and that person has provided the business with their email address, there is an implied understanding that the customer has consented to receiving relevant email communication from that business. Not ideal, but it’s still a valid form of consent as long as the relationship between the business and the customer is strong enough and the customer is given the ability to unsubscribe at any time. The difficulty is it leaves room for interpretation and raises some tricky questions so you need to tread carefully. Does a one-off transaction constitute a business relationship? How recently does someone need to have done business with you in order for you to reasonably infer consent? How exactly do you define ‘relevant’ content?
3. Deemed consent – Provides an allowance for sending email to a recipient when that person or business conspicuously publishes their work-related email address in a public place such as a website, magazine or directory and the content of the email is relevant to their business or industry. It’s best to steer well clear of this form of consent because even if you’re technically within the boundaries of the law, it’s likely to result in angry recipients and is certainly not considered best practice in the world of responsible email marketers.

But where do refer-a-friend campaigns fit in to all of this?

The FAQ’s page on the DIA’s Anti-Spam website contains a section addressing the legality of ‘send to a friend’ campaigns. To quote from that page:

Will it be considered spam if we run a campaign encouraging existing customers to “email a friend”?

Friend get friend campaigns, or ‘viral marketing’, usually encourage subscribers to provide the name and email address of a friend who is then sent a commercial electronic message and emailed by the company or promoter encouraging them to opt in/register.

An electronic message such as this would be unsolicited because the friend has not consented to receiving the message from the company or promoter. Consequently if the message was commercial (i.e. marketing or promoting goods, services, land, a business or investment opportunity) it would be considered spam. However, if the companies email is forwarded by the recipient to a friend(s) this is usually okay.

Further down the page we see another slightly different scenario addressed:

We have set up a website to promote a new product we have launched. To do so we created a game that is fun to play, and allows the user to send a challenge to their friend via email. The email message links to the game with some text set by the challenger. Who has the onus of consent?

The primary question is whether or not the sending of the commercial electronic message is ‘unsolicited’.

In this case the challenger (not the company) is the sender of the commercial electronic message and would need to have the consent of the recipient. In the case of a friend sending a friend a message this should not be a problem as the nature of the relationship is that consent can reasonably be inferred.

Ok, so what does this mean? Well, I think it all comes down to how we define the ‘sender’ of the emails and how the referral campaign is structured. Clearly, it’s not cool to simply gather and store a list of addresses provided by your subscribers in order to later deploy a bulk opt-in email to these recipients. In this case, it’s obvious that the sender is the company and not the friend.

But what happens when we setup a landing page which enables our subscribers to instantly send an invite email directly to their friends? According to the second scenario quoted above, this is acceptable because the subscriber acts as the sender, thus eliminating the issue of consent.

A question I’ve encountered many times is whether the referring email must be sent using the reply address and from name of the referrer in order to comply with the law. I believe this is something in particular which needs clarification as it does raise a number of other potential issues involving the implications of using a reply email address on behalf of the actual owner. Some referral systems which use this method could risk inviting abuse by allowing someone to effectively send an email from whichever address they enter into the form (spoofing).

Here’s 4 rules that I recommend following in order to stay on the right side of the law and avoid attracting complaints from your recipients.

1. The content of the invite or referral email must make it clear that the email has been triggered by the referring friend. The email pre-header should provide the full name and email address of the referrer and the URL of the page from which the email was generated.
2. Referral emails should be triggered instantly on a one-to-one basis and not stored in a database for bulk deployment at a later date. This is one of the key differences between a legitimate referral campaign and a potential law suit.
3. Be completely transparent with the referring subscriber about what exactly will happen after they enter their friends details and submit the form. If possible – allow the referrer to append a personal message to the top of the email content and enable them to preview the full email before triggering it, this way there can be no confusion around what exactly will be sent and about which party is assuming the role of ‘sender’. Also, be sure to provide an assurance to referrers that their friends’ information will not be stored or shared with any third parties.
4. Be careful when incentivising referral campaigns. Sure, it’s useful to offer some form of enticement to provide your subscribers with the motivation required to make a referral campaign work but the last thing you want is to turn your subscribers into spammers by encouraging them to fire out invites to everyone in their address book. Remember, as email marketers it’s about list quality, not quantity. I don’t know about you, but I’d rather have 500 new subscribers who are genuinely interested in hearing about my brand than a list of 5,000 random people who are only on the list because they wanted a chance to win a free iPad.

   What does this mean in practical terms? Make a point of telling your subscribers to refer only their friends who they think might be interested in hearing from your company and avoid linking an incentive directly to the volume of referral emails sent. If you want to incentivise based on volume, then my suggestion is to tie it to conversions (for example, the number of friends who subscribe to your newsletter or who make a purchase) rather than simply the number of invitations sent. Of course this requires some clever tracking and the ability to attribute conversions back to the original referrer but any decent email service provider should be able to help you to facilitate that.

That’s my take on it, but I’d be interested to hear the perspective of anyone else in the industry on this topic. Are you confident that your referral campaigns comply with the law? Do you feel that the anti-spam law needs to be clarified around viral marketing?

Refer a friend, forward to a friend, viral marketing, legal pass-along, referrer, referree, loyalty rewards, referral programs, recommend a friend, invite a friend, tell a friend, brand advocates… and include social media you can add share this, share with your network (SWYN), post to facebook…..  doing it right makes all the difference.

This is tricky, but not impossible – and the results can be extraordinary.

We want to reach more people, and start conversations that will increase their propensity to buy from us.

UPDATE: 11/02/2011 The New Zealand Anti Spam Unit is now publishing the reports of action taken against individuals which you can read here.

The best way to approach is to get the best tools and advice you can. Give us a call at jericho on +64 9 360 6463 – We can help you get this right.

You can also check out more postings about refer a friend campaigns, incentivising refer a friend, share to social, other places on this blog and on our website at www.smartmailpro.com

You might want to start with how to get started – one of the best ways we know is to stop whinging and get out the scissors. Or you could read: 10 Ways email marketing has fundamentally changed,  Subscribe, share and other missed opportunities

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