By now every fundraiser in the land will be aware of the ICO’s draconian stance on wealth screening, data appending and data matching following the recent Fundraising and Regulatory Compliance conference in Manchester.
The bow waves from this conference are going to be immense not just for the charity sector, but for marketers in general, if the ICO continues to be allowed to interpret the Data Protection Act in this manner. And make no mistake – this is purely an interpretation of the DPA; it is entirely subjective. One person’s ‘fair’ is another person’s ‘unfair’.
It is for this reason that for those of us in the data industry that have worked incredibly hard with fundraisers over the past three decades to gain a more holistic understanding of their donors that we won’t be taking this ruling lying down. We passionately believe, not only in protecting our businesses, but in the benefits that data services, when used responsibly, bring.
It is true that at times some ethical boundaries have been crossed and it was for this reason that the investigation into fundraising practices came to light. However, both the charity sector and the data industry were quick to respond and put safeguards in place to ensure the vulnerable were protected. For the ICO to now be going after legitimate and long standing marketing practices such as home mover trace products on the assumption that it is ‘unfair’ is tantamount to a witch hunt.
Moreover, where does this stop? This insane interpretation surely applies to all sectors, not just charities. Or is it ‘unfair’ to trace donors but ‘fair’ for supermarkets that provide money-off vouchers to trace their lost customers?
On the topic of home movers, research shows that people that are moving house now have an average of 39 essential providers to inform of their new address. This includes financial institutions, schools, government bodies, doctors, dentists and utilities. On average this takes around 10 hours to carry out. If you add to this list a person’s favourite retailers, charities, loyalty schemes, entertainment channels etc. the list to inform stretches to over a hundred organisations and becomes a monumental task taking three working days to complete. It is therefore unsurprising that the majority of home movers don’t get round to telling a charity that they donate to or an online retailer that they enjoy receiving a catalogue from that they have moved house?
Previous relationship with the charity
Consequently, how can trace products be deemed unfair if the person has had a previous relationship with the charity? It’s not as if the donor has moved house for the sole reason of escaping the charity – if that was the case they simply stop their donation and ask to be unsubscribed from the marketing database and communications will cease.
Rational arguments such as this need to be presented and the data industry along with its trade associations will be rallying to formulate a strong defence of these practices. At the end of the day the data industry is one that the economy can ill afford to lose, contributing billions to GDP annually. Moreover, the government relies on charities to provide the socio-economic assistance that it cannot. If donations dry up the well-being of the nation will decline.
Legitimate marketing tools
But in the meantime what does this mean for the charity sector? Elizabeth Denham has said that none of these practices are illegal. Consequently, fundraisers should still be able to use these entirely legitimate marketing tools without fear of prosecution.
More clarity is needed from the ICO but it seems that the emphasis is now on the charity to be satisfied that their permissions/privacy statements are clear and openly disclose how they intend to use the customer data – whether it is to locate a donor if they have moved, determine their lifetime value or find additional information on that person.
Making no bones about it, this will be a huge challenge and costly in terms of legal advice but the data industry will be working tirelessly to help its charity clients with this process whilst simultaneously fighting what the ICO currently defines as a breach of the DPA.
Martin Rides is Managing Director of The Software Bureau.
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