In this series, we will review the lead generation space and the regulations you need to know if you are a lead generator, a reseller, or seller (as defined by the FCC). This first post will review the Federal Communications Commission (FCC), the Telephone Consumer Protection Act (TCPA), and solutions to abide by the guidelines.
First, let’s start with defining some terms.
What is the FCC? The FCC regulates interstate and international communications by radio, television, wire, satellite, and cable in all 50 states, the District of Columbia, and U.S. territories. An independent U.S. government agency overseen by Congress, the Commission is the federal agency responsible for implementing and enforcing America's communications laws and regulations. - source
What is the TCPA? It is the primary federal law governing the regulation of telephone solicitations. It was first signed into law by President George H.W. Bush in 1991 and has remained the bedrock of federal telemarketing regulations ever since. Further legislation, such as 2019's TRACED Act and the Federal Communications Commission (FCC) and Federal Trade Commission (FTC) rulemaking, have built on the TCPA's foundation. Numerous court decisions—including recent, prominent ones from the Supreme Court—have further entrenched the TCPA's regulatory preeminence. - source
What is a lead? A user that provides their information in exchange for additional information on a product or service.
What is a lead generator? A company that owns the web property on which the user submits their information.
What is a reseller? A company that aggregates multiple seller companies and manages the accounts. Also known as wholesalers, aggregators, resellers, lead generation companies.
What is a seller? A company that will contact the user in an effort to sell the user some good or service. Also known as lead buyers, partners, clients.
To catch you up to the present, The FCC has taken steps to address what they call "the lead generation loophole" in their recent ruling. As the industry witnesses regulatory changes, it becomes essential to transition your business and understand the overall framework aspects of FCC regulations, particularly concerning the TCPA, and understand one-to-one consent. This series is for keeping up with regulations. This first post will delve into the intricacies of proving consent, updating contracts for liability, and providing tailored solutions for lead generators, resellers, and buyers (or sellers as the FCC refers to them).
The Lead Generation Loophole
Most lead generation companies respect the leads that submit their forms. However, like in every industry, a few bad apples can spoil the bunch. Without oversight, these companies sell lead information too often or to partners that spam the lead without concern, leading to issues like spam texts and robocalls. The FCC's recent actions move to close this gap and enforce stricter regulations. The core philosophy behind these changes aligns with a simple yet powerful principle: "If you would not let your mother fill out your lead form, you are doing something wrong." If you don't know what we're talking about, we did a test where we submitted one Assumed contact into a health insurance form. The result is that we received over 300 calls in 2 days. That's a problem.
Logical and Topical Approaches
Another part of the ruling is that communications must be logically and topically related. What does that mean? We're not lawyers, but if someone submits a lead for window replacement and starts getting calls for auto insurance, that's not exactly what they expected now, is it? These regulations are not arbitrary; they respond to industry practices that adversely impact consumers. By understanding the logic behind the FCC's decisions, lead generation businesses can proactively align their practices with the evolving legal landscape. There is much industry discussion about what exactly is logically and topically related. The FCC should go into more detail before the ruling takes effect in January 2025. For the most up-to-date answers we can produce, please see our Dynamic Consent FAQ.
Proving Consent and Solutions for Lead Generators, Aggregators and Buyers
Companies handling leads now need to push for more transparency and consent in their lead generation process. Dynamic Consent is our solution to provide the proper consent for leads to match that follow the FCC's guidelines. The ability to obtain one-to-one consent is shaking up the industry because it will be required when the ruling goes into effect. Proving consent and holding on to those records will become central, and companies will have to allow consumers to choose specific sellers to access their information. This shift may be difficult for some, but over time, it will enhance transparency, reduce spam, and elevate the overall quality of leads. We have four current solutions:
Click-through traffic: An easy option for businesses with high website traffic, allowing leads to click through to buyers' websites without explicit consent.
Form Builder with Dynamic Consent: A more customized option for creating forms integrating Dynamic Consent into the lead flow.
Ping Post with APIs: The most customizable choice, offering complete control over the consumer experience, leveraging ping post-processing, and displaying relevant data at any stage.
Updating Contracts for Liability
Keeping your contracts, terms, and documentation has always been necessary. However, as the FCC tightens regulations, checking and updating these will be essential for companies in the lead generation space. Clearly outline responsibilities, adhere to new guidelines, and acknowledge liability in your documents to be transparent with consumers and partners. Businesses that embrace these updates will position themselves as ethical players in the industry.
In conclusion, the FCC's actions aim to instill transparency, trust, and accountability in the lead generation industry. As businesses adapt to these changes, they must prioritize logical and ethical approaches, prove consent and update liability contracts. To ensure your company is in line with all these steps, you may have to explore tailored solutions that form your business and help your business stay within the guidelines with the provided solutions. By staying in the loop with regulation, lead generation companies comply and contribute to a more ethical and sustainable industry, fostering trust among consumers and stakeholders alike. Hopefully, at the end of all this, you'd feel more comfortable letting your mother fill out online forms, knowing she will have to consent to receive messages instead of being flooded with calls and texts.