Promotion Marketing Association of
BY FACSIMILE AND FEDERAL EXPRESS
April 15, 1997
RE: CONSUMER PRIVACY 1997 -- COMMENT -- P954807
Promotion Marketing Association of America, Inc.
Ronald S. Goldbrenner, Esq.
Linda A. Goldstein, Esq.
The Promotion Marketing Association of America, Inc. ("PMAA") respectfully submits the following statements in response to the Federal Trade Commission's Federal Register notice requesting comments on consumer privacy in connection with online marketing. The PMAA would also request to be included in Session Two of the FTC's Public Workshop to be held June 11-12, 1997. As discussed further below, the PMAA believes that its participation in the Workshop would be extremely beneficial to the FTC.
REQUEST TO PARTICIPATE IN SESSION TWO - CONSUMER ONLINE PRIVACY
The PMAA respectfully requests that it be allowed to participate in the FTC's "Consumer Online Privacy" Workshop --Session Two. The PMAA is a non-profit trade association representing the multi-billion dollar promotion marketing profession since 1911. Its membership consists of more than 700 companies worldwide encompassing all segments of the promotion industry. PMAA's membership is diverse, including many Fortune 500 consumer goods and services companies, leading promotion marketing service/supplier agencies and law firms, as well as university faculty and students. PMAA is proud to have as its members such well-recognized and respected companies as The Coca-Cola Company, General Mills, MasterCard International, Kraft Foods, Procter & Gamble, and The Walt Disney Company. PMAA's mission is to encourage the highest standards of excellence in promotion marketing. PMAA represents member interests and promotes better understanding of the importance of promotion in marketing. PMAA is also relied upon by its members to work proactively with governmental and regulatory agencies to preserve a regulatory climate and environment in which the need of the marketing community can be met.
As one of the world's premier promotional marketing trade associations, PMAA is eminently qualified to offer the FTC a unique and essential perspective on how the industry actually does collect and use consumer information in online marketing. Central to this perspective would be the delicate balance faced by industry members when developing and implementing online marketing promotions intended to benefit consumers with individual and governmental interests concerning the limitation and/or restriction of the dissemination and use of sensitive personal information. As a representative of some of the largest consumer goods and services companies, the PMAA would be able to share with the Commission critical information on the importance of database marketing to the future growth of the World Wide Web as an effective marketing tool. In this respect, the PMAA recently forwarded to all of its members a brief questionnaire survey requesting information about the members' websites. Although we had hoped to have a significant number of responses compiled and reviewed in time for this submission, to date we have not received enough responses from which we would feel comfortable making statements that accurately reflect our membership. A cursory review of the responses are, however, instructive. Most significantly, most respondents indicated that consumer perception and trust is of the foremost concern when determining how to compile and use information culled from visitors. These responses also indicate that there is no single method of tracking and using consumer information. The responses also indicated that for many marketers, the web site is still in its infant phases, making it difficult to determine at this point precisely what regulations, if any, would be appropriate.
While the PMAA recognizes and respects that the FTC's primary purpose in conducting these Workshops is to ensure that sensitive consumer personal information remains protected, it also recognizes that the collection and use of some personal information allows legitimate companies to directly offer consumers products and services that they would likely be interested in, but not know about absent a direct solicitation. For example, a consumer that visits a web site designed to discuss infant maladies might be interested in receiving information from a pharmaceutical company that offers products addressing the problem discussed on the web page. A consumer that visits a sports-oriented site might be interested in hearing about upcoming ticket promotions or new sporting goods. These are but a few examples of consumer benefits that could and do result from the compilation and use of information derived from site visitation. We anticipate that there will be significant technological developments as the state of the online art develops and hope that the FTC's actions encourage rather than impede such developments.
In conclusion, the PMAA respectfully requests that it be invited to participate in the FTC's privacy workshop in June. The PMAA would be able to provide invaluable industry insights to compliment the FTC's regulatory mission. With the PMAA as a participant, the FTC would have at its disposal the experiences of hundreds of well-known consumer product and service companies.
COMMENT: Information Collection and Use
Questions 2.1 and 2.2
As indicated above, in anticipation of the FTC's Request for Comments, the PMAA had requested that its members respond to a survey that included, among other things, information requested by the FTC in questions 2.1 and 2.2. A preliminary review of these responses indicate that many PMAA members do request, maintain, and use in its internal marketing plans, information from visitors to their respective web sites. Most respondents indicate that the information they collect comes from two sources; by clickstream and from consumer responses to specific questions. Almost all respondents indicate that the information culled from these sources is used only for internal marketing promotions, and not sold or rented to outside companies or brokers. PMAA members recognize the importance of establishing and keeping a consumer's trust and attempts to maintain such trust in their handling of a customer's personal information.
Some members have indicated that clickstream information is used for internal auditing purposes only. This information tells the site manager how long visitors are staying on a given page and what attracts them to the next page. Other respondents indicate that they solicit and maintain specific consumer information that is used only for internal future promotional efforts. For example, one member requests from its visitors information about the visitor's facial attributes, so that it may in the future offer products directly to that visitor that would address the visitor's specific cosmetic preferences.
While some respondents indicated that they use collected consumer information for internal promotions only, it is foreseeable, and indeed beneficial for consumers, that outside companies with products or services similar to the tracking company have access to this information. This will enable the latter company to offer consumers goods and services consistent with their initial site visit. Therefore, the PMAA believes that this stream of information should not be prohibited or restricted to the point that consumers are not afforded the opportunity to learn of new products that they would not otherwise have found on their own.
Because it is not yet clear what technology can afford in the long run, the PMAA feels that governmental regulation at this stage would be premature. Self-regulation appears to be the most effective and efficient method for determining standards by which companies should conduct their online practices. Self-regulation is flexible -- it can quickly and efficiently address changing environments and technologies, a function that governmental regulation cannot carry out. Therefore, the PMAA recommends that industry self regulation be supported by the FTC as it can more appropriately and effectively address and adapt to future technological developments. Should this new media be shackled by governmental regulation in its infancy, it will likely retard and inhibit the growth of what the PMAA perceives to be an exciting and necessary marketing tool for the future. At the same time, the PMAA strongly supports the FTC's mission to prevent abuses in this arena.