The FCC’s Ruling on Lead Generation and Consent: A Quick Guide

The FCC’s Ruling on Lead Generation and Consent: A Quick Guide Featured Image

How to Make Sure You’re Compliant With New Lead Texting Rules

In recent years, the surge of unwanted texts and phone calls has become a growing concern for consumers across the United States. These intrusive communications, often known as robotexts and robocalls, have not only become quite annoying for consumers but are also a potential threat to privacy and security. 

In fact, according to Verse’s Director, Carrier Relations, Mandy Basra, carriers were receiving 86 billion consumer complaints per year for spam texts and calls. 

Recognizing the severity and urgency of the issue, the Federal Communications Commission (FCC) issued a Notice of Proposed Rulemaking on February 23, 2023 to “ban the practice of obtaining a single consumer consent as grounds for delivering calls and text messages from multiple marketers on subjects beyond the scope of the original consent.”

This proposed rule aimed to restrict lead generators from securing consent for calls and texts through a hyperlink to multiple “partner companies,” insisting instead that consent be given directly on the same page. The announcement of this proposed ruling made headlines, as it could significantly alter the process of obtaining consent for marketing communications under the Telephone Consumer Protection Act (TCPA).

Today, in a landmark ruling, the FCC voted 4-1 to close the “lead generator” robocall/robotexts loophole, requiring one-to-one consent for calls or texts made to consumers by goods or service providers. 

This new rule also requires that all robotexts and robocalls made by goods or service providers to consumers be “topically and logically” related to the “transaction” that initiated the consent. In other words, the consent given by a consumer to receive robocalls or robotexts regarding a good or service must be directly and topically related to the website on which they gave their consent.

In this blog post, you’ll get information on:

What Are the FCC’s New Lead Generation Rules?

The rules adopted by the FCC today represent a major step forward in protecting consumers from scam communications. They directly address closing the “lead generator” robocall/robotext loophole and will allow the blocking of “red flagged” robotexting numbers.

Overview of the FCC Ruling

Under the revised guidelines, the FCC’s crackdown on illegal texting zeroes in on unsolicited messages that are sent without the recipient’s express consent. What does this all really mean? It all boils down to this: you cannot leverage technology to call or text a lead unless the person you are reaching out to has given explicit consent to receive communications from your business.

Additionally, a consumer can only give consent to receiving robocalls or robotexts directly or topically related to the website they gave their consent on. For example, if a consumer consents to receive information on a website dedicated to comparing car loans, this does not extend to receiving robotexts or robocalls about services like loan consolidation, which are not related to their initial interest.

According to a press release from the FCC(PDF), the new ruling focuses on three main categories:

  • Combating robotexting sources
  • Closing the lead generator loophole
  • Laying the groundwork for future steps

Combating Robotext Sources

The FCC’s press release states that the new rules will allow the FCC to: “… ‘red flag’ certain numbers, requiring mobile carriers to block texts from those numbers.” The new rules will also “…codify that Do-Not-Call list protections apply to text messaging, making it illegal for marketing texts to be sent to numbers on the registry.” 

Closing the Lead Generator Loophole

Prior to the ruling, marketing companies had the ability to obtain consent for multiple companies to contact consumers using a single opt-in, which was a widely-held practice in connection with comparison shopping websites. The new rules will close this loophole, and according to the FCC’s press release, “…make it unequivocally clear that comparison shopping websites and lead generators must obtain consumer consent to receive robocalls and robotexts one seller at a time – rather than have a single consent apply to multiple telemarketers at once.”

Groundwork for Future Steps

In addition to the regulations passed in today’s ruling, the FCC’s press release outlines additional steps the Commission might take in the future against robotexts, proposing that they may enstate additional blocking requirements when a provider is notified by the FCC of a likely scam-generating number. Additionally, the Commission is also slated to, “…seek further comment on text message authentication – modeled on the successful implementation of STIR/SHAKEN protocols for phone calls – including on the status of any industry standards in development.”

When Do the New Rules Go Into Effect?

Businesses will have until January 27, 2025 to rethink their lead generation strategy to ensure compliance with the new FCC guidelines for texting. While this may be a devastating change for some, it provides an opportunity for businesses to rely on resources like to become compliant and keep their operations up and running quickly. Those who don’t reevaluate their lead generation strategies and tactics and act swiftly to comply with the new rules are at risk for being hit with substantial penalties.

What Does the FCC Ruling Mean for Businesses?

The new FCC ruling is going to cause a major shift in how businesses think about lead generation. The old days of “volume is king” are over. Leads are now more important than ever, and it’s all about putting yourself in the shoes of the consumer and speaking to them respectfully and intelligently. 

Rethinking Your Lead Strategy

With the FCCs new regulations, one thing is clear: if you’re using text messaging as a channel to communicate with leads, the way you’re currently executing probably needs to change. But one important thing to remember is that the way your leads behave, won’t. 

The same number of leads will be out in the marketplace looking to make buying decisions, but your approach to how you get access to those leads could be dramatically different. It’s time to start thinking about what your company can do to generate more first-party leads, to ensure you have the consent you need to effectively market to your target customers.

For companies who purchase leads, your cost per lead will likely increase, making it important that you execute on each lead with a timely, intelligent outreach. But the question is, can you do that cost-effectively, at scale? Perhaps counterintuitive to the FCC’s ruling, texting, if done correctly and compliantly, is your best bet to reach your leads at the right time, with the right message, right where they are before your competitors do.

If you’re currently using texting to engage with new leads, the compliance piece is what you’ll need to focus on. The legal ramifications for getting it wrong could be detrimental to your business. But if done correctly, your brand will benefit from timely and respectful lead outreach.

Taking the Next Step Toward Total Compliance

Regardless of whether you’re currently texting to engage with new leads or want to implement it as a scalable approach to give your business a competitive edge, your biggest takeaway from the new FCC ruling should be the importance of respecting the consumer and getting it right…and the consequences of getting it wrong.

If you’re interested in how you can get it right, without having to do all the work, schedule a call with Verse to learn more.

Frequently Asked Questions

Q: What is the Federal Communications Commission (FCC)?

A: The Federal Communications Commission (FCC) is an independent agency of the United States government, overseen by Congress, that was created for the purpose of regulating both interstate and international communications by phone services of all types, as well as cable, television, radio, satellite, and wire. In short, it’s the federal agency that is responsible for implementing and enforcing communications law and regulations in all 50 states, U.S. territories, and the District of Columbia. 

Q: What is the Telephone Consumer Protection Act (TCPA)?

A: The Telephone Consumer Protection Act (TCPA) is a federal law that was enacted in 1991 to protect consumers from unwanted texts and telemarketing calls. The law requires businesses to obtain prior express written consent from consumers before sending them automated or pre-recorded calls or texts. This includes calls and texts made using automated dialing systems, artificial or pre-recorded voices, and SMS texts.

Q: What was the outcome of the FCC’s ruling on December 13, 2023?

A: The FCC voted to crack down on illegal texting, closing the lead generator loophole by requiring comparison shopping websites and lead generators to obtain explicit, one-to-one consent by consumers to receive robocalls and robotexts from sellers. 

Q: When does this new FCC ruling go into effect?

A: All businesses will be required to be in compliance with the FCC’s new requirements by January 27th, 2025.

Q: Why is the FCC’s recent crackdown on illegal text messages important for lead generation?

A: The FCC’s recent crackdown targets illegal text messages to protect consumers from scam texts and ensure that companies handling leads comply with the Telephone Consumer Protection Act (TCPA). This directive is significant for organizations as it directly affects user trust and the integrity of marketing practices, pivotal in nurturing and converting prospects into quality leads.

Q: How does the FCC’s enforcement of illegal text messages impact lead-generation practices?

A: The FCC’s stringent enforcement against illegal text messaging, particularly through its Declaratory Ruling under the Telephone Consumer Protection Act (TCPA), sets boundaries that companies must navigate carefully to ensure compliance during lead texting activities. As these regulations aim to shield consumers from uninvited communications, businesses involved in lead gen must refine their strategies, prioritizing consent, and personalization to maintain the integrity of their sales funnel and protect against potential legal repercussions.

Q: What adjustments do businesses and marketers need to make to ensure compliant lead strategies?

A: To ensure compliant texting with leads, businesses and marketers must stay abreast of regulatory changes, such as those enforced by the FCC and other agencies, and integrate these rules into their campaign designs. Moreover, they must focus on obtaining explicit consent from prospects before engaging in communication, particularly through channels like phone calls and SMS, as mandated by laws like the Telephone Consumer Protection Act (TCPA).

Q: What are the legal implications for businesses that engage in non-compliant text messaging practices with leads?

A: Businesses that engage in non-compliant text messaging with leads risk incurring hefty fines from the Federal Communications Commission (FCC) due to violations of the Telephone Consumer Protection Act (TCPA). Additionally, these practices can lead to class action lawsuits and damage to the company’s reputation, as consumers and prospects grow increasingly weary of unwanted text communications and robocalls from relentless sales teams.

Q. Is there an easy way to stay in compliance with the FCC’s new ruling?

A: Yes, let do the work for you! As a Verse customer, you’ll have an SMS compliance team in conjunction with our TrustContact™ product suite to protect your business from legal consequences and fines. Non-compliance with laws and regulations can result in significant penalties, which can be damaging to your reputation and financial stability. By working with Verse, you can avoid these risks and ensure that your business is operating within the bounds of the law.

An SMS compliance team can also improve the deliverability of your text messages. By following best practices for message content and formatting, you can increase the likelihood that your messages will be delivered and read by your leads. This can improve the effectiveness of your communication and lead to better results for your business.

In addition to improving deliverability, an SMS compliance team can enhance the customer experience for your leads. This includes things like providing opt-out instructions and being transparent about the purpose of the text messages. By following best practices, you can create a more positive experience for your leads and build trust with them.

Finally, having an SMS compliance team can help increase trust in your business. By demonstrating a commitment to compliance, you can establish your business as a reputable and reliable source of information. This can be especially important for lead nurturing, as trust is a crucial factor in converting leads into customers.

In summary, an SMS compliance team can be a valuable asset for any lead-nurturing business. By following the rules and best practices for text message communication, you can protect your business from legal consequences, improve deliverability, enhance the customer experience, and increase trust with your leads.