Updated: Oct 16, 2021
One of the most effective strategies in marketing is email marketing, which is a great way to provide value to your customers. It helps you to position your business as the leading expert in the industry. It also allows your existing and potential customers to get to know you better and trust your brand more.
Moreover, email marketing facilitates a high rate of conversion, which means increased revenue generation. However, at times, your efforts to reach potential customers can run the risk of breaching the law.
That is why you need to understand the laws that apply to email marketing well, so that your campaigns do not end up being flagged as spam.
What is 'spam'?
‘Spam’ is the commonly used term for the promotional emails sent to those customers who have not requested them.
If your business practices email marketing, you must ensure that you comply with the Australian Spam Law. This can be particularly relevant for businesses that conduct large-scale or automated marketing campaigns that have the potential to reach a large audience.
In this article, we will discuss the legal rules for email marketing in detail.
Author: Farrah Motley, an Australian legal practitioner and Legal Principal of the commercial law firm, Prosper Law.
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Australian Laws on Email Marketing
The legislation on spam in Australia is the Spam Act 2003 (Cth), which governs when and how businesses can engage in email marketing. If you do not meet specific requirements, the Spam Act can prohibit you from sending out electronic messages where:
an Australian link is included
one of the purposes or the primary purpose of the message is commercial (i.e. to make money)
Each of these points is explained below.
An electronic message, such as an email, text, or Whatsapp message, is considered to be an 'Australian link' if at least one of the following points is met in relation to the message:
the message originated from Australia
if an entity within Australia controls the sender or the person that has authorised the message to be sent, and that entity is physically present in Australia or it's central management and control is in Australia when the message was sent
the computer, server or device that is used to access the message is located in Australia
the electronic account-holder is physically present in Australia or the organisation carries out business activities in Australia when the message is accessed
if the message is unable to be delivered because the relevant electronic address no longer exists, it is reasonably likely that the message would have been accessed using a computer, server or device in Australia
Commercial messages refer to those messages, which are sent with the purpose of either:
offering to supply goods or services
advertising or promoting goods or services, or
advertising or promoting a supplier of goods or services
This is usually determined by how the message is presented, what the content is, and if the content is accessible via links.
Even if the purpose of the message is not primarily a commercial purpose, but a secondary purpose, the Spam Act will still apply.
The Legal Rules for Email Marketing
The Spam Law in Australia is designed to stop businesses from spreading spam that can intrude on an individual's privacy. That is why, if you are an email marketer, you must be aware of the 3 legal rules for email marketing:
You must first get the permission of your customers if you want to send them email marketing. This consent can be express ("I give my consent") or it can be inferred.
For example, when a customer 'opts-in' to receive emails from your business, it is referred to as express consent. This means that the customer has explicitly given their consent for you to send them emailing marketing by entering their email and clicking ‘subscribe’.
On the other hand, whether or not your customer has given implied consent to receive email marketing will depend on the circumstances. You need to assess your relationship with your customer and whether a reasonable person in the circumstances would consider that the customer has impliedly given their consent to receive email marketing.
For instance, if a customer holds a gym membership, it may be inferred that he or she may be interested in receiving marketing messages related to the gym. In either case, you must keep a detailed record of when and how you obtained the consent of those customers in your email list.
The emails that you send to your customers must contain explicit sender details so that the recipients can contact you or your business effortlessly. In every message, you must include your registered trading name and your contact information like phone number, address, email address, etc. You can either use your name and ABN or the correct legal name of your business.
Furthermore, the information provided must be easy to access, clear and concise, and remain accurate for at least 30 days after the message has been sent. Otherwise, you might end up breaching the Spam Act. In case you allow someone else to send the emails on your behalf, make sure that the messages still identify you as the business that authorised them.
3. Unsubscribe/Opt-Out Options
You must always provide the recipients of your promotional emails the option to opt-out at any point in time. In addition, you must include a clear and straightforward way of unsubscribing from your emails. You must also ensure that the privacy functionality on your website is user-friendly to future-proof the digital presence of your organisation.
The opt-out option that you provide in your message must remain functional for no less than 30 days from sending the message. Moreover, you cannot charge your customer a fee for processing an opt-out. Also, if any recipient requests to unsubscribe, you must remove that subscriber from your commercial electronic messages list within 5 business days of sending the request.
Consequences of Not Complying With the Email Marketing Laws
If you fail to honour the opt-out request within the stipulated time frame, all your future commercial electronic messages will be considered spam. It so happens because, by unsubscribing, the recipient has essentially withdrawn their consent. Therefore, you end up breaching one of the three requirements of sending a commercial electronic message legally.
If your recipients continue to receive commercial electronic messages from your business even after unsubscribing, then they may make a formal complaint to the Australia Communications and Media Authority (ACMA). They are the regulator responsible for monitoring and enforcing the Spam Act 2003 (Cth).
ACMA has the power to carry out the following steps if they find out there has been a breach in the Spam Act:
Give formal warnings
Issue infringement notices
Take the matter to the Federal Court, which can impose significant penalties
Seek injunctions from the Federal Court
Accept undertakings from the sender
Repeat corporate offenders who send two or more promotional messages in a day without consent may end up paying penalties up to $2.22 million a day.
Exceptions to the Email Marketing Laws
Two types of promotional emails are partially exempt from the law prohibiting spam email marketing. However, for both these types of emails, you still need to comply with the identity requirement.
1. Completely factual emails that do not contain any commercial material. Hence they do not require meeting the consent and unsubscribing requirements. Such emails include messages that:
advise the recipient and are not commercial
offer a price/quote to the customer
provide a product description to the customer
are sent for the recipient’s genuine safety
2. Emails from permitted bodies that are exempt from the Spam Act. These organisations may include educational institutions, registered charities, government bodies, or registered political parties.
To achieve the sales targets, sending out multiple emails as a last resort can be a good idea, provided you are not engaging in spam marketing practices.
This is because, in email marketing, it is never a good practice to send two or more emails in a day. However, in case you are, be sure to comply with all the existing email marketing laws.
How Can Prosper Law Help?
Prosper Law is an online, Australian commercial law firm. If you own or work at a business that is thinking about email marketing, contact our team for a free consultation and a no-obligation, fixed fee quote.
Want to read more? Check out our latest article which answers the question 'what are liquidated damages?'.
Farrah Motley | Legal Principal
PROSPER LAW - A Commercial Law Firm for Businesses
M: 0422 721 121
A: Suite 99, Level 54, One One One Eagle Street, Brisbane, Queensland, Australia