Business correspondence via SMS
June 27, 2014 12:03 PM   Subscribe

The management software my company uses recently added the ability to send messages via SMS to our clientele. We've signed up and it's tested well, but we're not clear on the legality of sending business correspondence messages (no marketing, simply "Your rent is due, please call # or pay online @") without the client expressly opting in for SMS messaging. Do we need to have everyone opt-in or are non-marketing messages for the purpose of communicating legitimate business notices exempt?

We have several thousand clients and to get all of them to opt-in would be a major headache, not to mention less ROI for the money we've expended.

If the messages are allowed, would messages like "Our Company wishes you a happy birthday!" be considered marketing?

Does anyone have a link to laws that govern this? I looked but 99% are discussions on marketing, which IS an absolute no-no without opt-in. We are in Florida if that matters.

Thanks, all!
posted by dozo to Law & Government (21 answers total) 1 user marked this as a favorite
Without an opt-in, you're potentially sending messages to people that will cost them money, since many people have plans for which incoming text messages cost money.

This is what a quick consultation with a lawyer would be for. I can't imagine you're the first company asking this question.
posted by Tomorrowful at 12:06 PM on June 27, 2014 [1 favorite]

text messages cost me $0.20 each to receive. You'd be getting a bill, or it deducted from the rent if you forced me to receive such a thing. You need an automated opt-in solution and automated opt-out for people to change their minds.
posted by TheAdamist at 12:10 PM on June 27, 2014

You spam me with a birthday text and you're losing my IRL business even if it doesn't cost me extra. Texts for me are either for personal communications, specialized opt-in notifications (withdrawal notification from my bank, bill payment from my cell phone co., emergency alert from my employer, etc.), or password authentication. Otherwise I expect an opt in model and I won't be opting in.

Don't be penny wise and pound foolish. An irritated customer might not stay a customer for long.

Opt in is a must.
posted by spitbull at 12:22 PM on June 27, 2014 [9 favorites]

To answer your actual question about legality, the relevant law here is the Telephone Consumer Protection Act, which has been determined to also cover text messages. My understanding of these regulations (the second link is especially helpful) would prohibit what you are trying to do unless your clientele explicitly opt-int, but I am by no means particularly competent in these regulations. I would find it particularly difficult to justify that your messages are not "for the purpose of encouraging the purchase or rental of, or investment in, property, goods, or services" (TCPA definition), because if you weren't trying to get their business, you wouldn't bother contacting them.

I'll echo all other posters here that indicate that if your organization did this to me, that I'd specifically exclude your organization from consideration in future business.
posted by saeculorum at 12:23 PM on June 27, 2014 [1 favorite]

IAAL, IANYL. Definitely consult with a lawyer specializing in advertising/telemarketing law. This is a heavily regulated and litigated area, with hungry class action plaintiffs' attorneys circling like so many starving sharks, because the law (TCPA) awards specified damages per violation and attorney fees to affected consumers.

On preview: Yes, TCPA is a starting place for your research, but you need someone who can tell you the current state of caselaw, not just regulations.
posted by Atrahasis at 12:26 PM on June 27, 2014

If you believe that people will respond to SMS messages and change payment behavior to remit sooner, then you have a significant ROI. If you don't believe it will change payment behavior, then why risk alienating customers even if it's legal to do so?

A market research firm can answer this question regarding payment behavior - probably for much less than building an automated opt-in. If your lawyer says it's legal and supported by case law, then your next step is research.
posted by 26.2 at 12:27 PM on June 27, 2014

Gonna bet coding, testing, and deploying a web based opt in will cost you less than market research.

It's not rocket science and it's likely off the shelf functionality,
posted by spitbull at 12:32 PM on June 27, 2014

How does an annual birthday message possibly increase the speed with which accounts are paid? Presumably you fake a personal interest in your customers' private lives not to harass them into paying faster, but to make them think of your company as friendly and personal.

I'm telling you marketing spam by SMS always has the opposite effect on everyone I know. When my phone buzzes and I check it it had better not be more spam. That's why texting replaced email.
posted by spitbull at 12:36 PM on June 27, 2014 [1 favorite]

There are two costs of opt-in, building it and then getting people to use it. You're going to need to communicate that it exists, drive people to do it possibly through incentive. Your opt-in doesn't have return until you reach a scale of users and those users exhibit behavior changes in retention/payment. You could focus group the things together - what would make you opt-in? what would make you opt out? what messages would you tolerate. For 5-10K, you could have an answer.
posted by 26.2 at 12:46 PM on June 27, 2014

Can't answer the legal question, but as a person who deals with lots of businesses, I beg of you: think twice about this entire idea.

Imagine a charge on your bill because a business wanted to wish you happy birthday. Just imagine. It amounts to being charged for the marketing you're receiving. As long as texting is something is charged per-message to the consumer, it's not really an appropriate avenue for business communications unless you know that the person opts in. It's like calling people collect from a business, only they don't get to say yes or no. Not good.
posted by Linda_Holmes at 12:56 PM on June 27, 2014

You need a lawyer. TCPA claims can be exceedingly expensive for the defendant (statutory damages of $3000 per violation add up in the class action context) and the plaintiffs bar in this area is very aggressive. Any time you're thinking of sending texts, you need to consult a lawyer; it's just too risky to try and figure this out yourself. (IAAL, IAATelecomL, IANYL)
posted by devinemissk at 1:17 PM on June 27, 2014 [3 favorites]

I don't think this is a good idea, even if you have some sort of opt-in, opt-out functionality.

Unlimited texting plans are very popular, yes, but not everyone has them. Some people still have pay-per-text plans where it costs them 10c or 20c per message received. "Happy birthday! You just gave your cell provider another dime, courtesy of your leasing office!" That would be irritating.

While you're at it with "please pay your rent," you might as well add some functionality like "reply to this text message with PAY to pay your rent, or call 813-123-4567, or use our website."

Honestly, everyone who can successfully fog a knife with their breath knows that rent is due on the 1st of the month. I've never lived in any apartment where that wasn't the case. I don't see how a reminder text is going to make people who are late with rent change their behavior.

IANAL and TINLA, but I believe this kind of thing qualifies as an exception to TCPA because you're communicating with tenants, who are ALREADY your customers. You're not marketing your apartments to random people on the street via text message. (THAT is the kind of behavior that TCPA aims to prevent.)

However, just because you CAN doesn't mean that you SHOULD. Talk to a lawyer.
posted by tckma at 1:39 PM on June 27, 2014

Response by poster: Honestly, everyone who can successfully fog a knife with their breath knows that rent is due on the 1st of the month.

tckma, you must not be in real estate. I can attest to you that a full 15-25% of our clients, without fail, EVERY MONTH(!), swear up and down that they didn't know. Not only do we have many LARGE notices on the lease just above the signature and a notice that gets stapled to the completed lease given to the tenants but it's mentioned half a dozen times in the move-in. People suck.

And to the people who are getting their undies in a bunch about receiving one text - welcome to 2007. *facepalm* I can see how the birthday thing might be annoying (though slightly, and I'm not the one advocating for this) but it would only take one reply text of STOP to be taken off the list. I don't see how one annual opt-outable text would outrage you or cause you to move out of a property just because we used a number YOU GAVE US to communicate with you in a way that people communicate in the modern world.

I believe this kind of thing qualifies as an exception to TCPA because you're communicating with tenants, who are ALREADY your customers.

This is my understanding as well but wanted to hear other opinions.

Thanks to everyone that answered the legality question. We have done some research that leads us to believe that while email and phone calls are being ignored and forgotten, SMS gets a response in a quicker and more deliberate way. Just like telegrams and letters were popular but waned when other forms of communication came into fashion, the same is happening with calls and emails. Next we'll be sending you reminders via quantum mind com and hyper-laser oscillator balls when texting stops being de rigeur.

spitbull, you seem to be overly concerned with equating any message sent over text with spam, which I have already described quite adequately it is not. We are actually not "faking" it (thanks for the assumption, by the way) when we wish a happy birthday - many of our tenants and staff are quite close. We've actually held birthday parties - at our expense - for quite a few tenants. Many people come to us in their worst hour, and our staff is required to be caring, supportive and nurturing to do their job well. Not everyone lives in a feculent, swirling cesspool of people trying to scam us out of money @ 10¢ a year.
posted by dozo at 3:20 PM on June 27, 2014

It sounds like you are dealing with a relatively small customer base if you care that much about every one of them. Which makes it hard to imagine why it would be difficult to allow people to opt in. I've never felt close to a landlord in my life. I appreciate when they are friendly and businesslike and efficient. But of course, I suppose there are landlords and tenants in this world who really do care about each other as people.

I'm not really talking about the dime, by the way (although "welcome to 2007" is pretty condescending). I'm talking about the experience of intrusion into private life by a business.

You're right, no one is going to move out over a text. But I'd be very surprised if some of them don't think "oh, my intrusive landlord is trying to get me to pay my rent on time again." Except for the ones that love you!

Anyway, from my perspective it's a weird question to focus on whether something is legal as opposed to whether something that might be legal is a good idea. The polite thing to do in my universe is allow people to opt in to text messaging used as commercial communication, with any sized business, including plenty with which I have long-established relationships. You seem intent on saving money to the point of rationalizing being impolite to your tenants. The answers in this thread already indicate that some people just don't like receiving marketing text messages. Maybe none of your tenants are that kind of person. Maybe it doesn't matter to your business if they are. But I hope you at least provide an opt-OUT alternative.
posted by spitbull at 3:41 PM on June 27, 2014

I wouldn't move out of an apartment over an unwanted text, but I would definitely be annoyed. I'd consider it bad customer service, and certainly take it into account when deciding whether or not to renew a lease, just as I have taken into account rude front office people, bad maintenance, and poor enforcement of parking space assignments. A combination of those things definitely could push me into moving somewhere else, or at least putting up a nasty review on one of those apartment rating websites.

I've found in business that "is it legal to do X" is a much less important question than "is it the right thing for my customers to do X." The problem isn't the specific case of sending texts — it's the attitude that doing something that annoys your residents is ok as long as it's legal and makes you more money.
posted by primethyme at 3:59 PM on June 27, 2014 [2 favorites]

There is no exception to the prior consent requirement in the TCPA for calls or texts to the wireless number of someone with whom you have an established business relationship. The kind of consent may differ, but you still have to get it.
posted by devinemissk at 5:31 PM on June 27, 2014

Count me among those who view my relationships with my landlords as business relationships: even when I was renting from a private citizen, and definitely when I was renting from a company. Count me also among those who is extremely annoyed when he receives a commercial text that I haven't explicitly asked a company to send me.
posted by Johnny Assay at 5:38 PM on June 27, 2014

If your problem is getting people to pay their rent on time, I suspect that adding a penalty for late payment will do a lot better job at fixing that behavior than sending out text messages that I didn't want and cost money for me to receive. By all means, feel free to send reminders to people that opt-into such a service though.
posted by Aleyn at 6:08 PM on June 27, 2014

Also, I find your attitude with the "Welcome to 2007" thing supremely distasteful. Like I said, you expend my limited resources by sending me a text. It is at the very least unethical to expect your customers to be okay with that without asking them.
posted by Aleyn at 6:12 PM on June 27, 2014

The company I work at uses service related SMS with our customers. While we're based in MA, we have customers in every state. When setting up the service, our legal team required that we make it opt in.

BTW, the same is true in the UK, where we also have customers, but there, incoming SMS are free to the receiver. So, it's not just about cost but also that SMS are more intrusive.

BTW, do you also have email reminders?
posted by reddot at 5:22 AM on June 28, 2014

We have done some research that leads us to believe that while email and phone calls are being ignored and forgotten, SMS gets a response in a quicker and more deliberate way.
This is curious. If you possess research that this is going to change payment behavior, then someone must be doing what you're proposing. That seems counter to your question.

but it would only take one reply text of STOP to be taken off the list.
For which the person will also incur costs.

Here is what people are telling you and you are not hearing. Not all communications are appropriate even if they work. If you scream in my ear I'll respond to you - probably not in the way you want me to respond.

Is it really so difficult to understand that if you respect your tenants in the way you say, then it would be simple courtesy and respect to ASK them?
posted by 26.2 at 10:05 AM on June 28, 2014 [2 favorites]

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