What’s the big deal about compliance marketing and why is it important?


INSIGHT
Published
Dec 10th '20
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As a marketer, you are surrounded by creative individuals whose focus is on the art and design of a marketing campaign. Creating engaging material that will appeal to your consumers is an intuitive talent for these marketers. However, it is important to balance that creativity with the practicalities and legalities of compliance marketing. There are compliance standards that you must meet in any marketing campaign, which requires a different kind of thinking that is probably not as second nature to your team members.

 

Compliance marketing standards protect consumers so that they are not lied to, tricked, or misled by businesses. These compliance regulations also ensure that a person’s privacy rights are protected and that they have an option regarding which type of information a brand collects and how they communicate with that business. Every member of your marketing team should have a general understanding of these compliance standards – but as a marketer, it’s even more crucial that you understand these rules.

 

Meeting these will not only protect your reputation and integrity, but it can also save you from making some costly (literally, not figuratively) marketing mistakes.

 

What’s the big deal about compliance marketing?

For marketers who want to focus on the creative aspects of a marketing campaign, compliance can seem like nothing more than a nuisance. You can argue about the value of compliance regulations all you want, but the simple truth is that it’s the law, and failing to comply can cost you money, reputational brand damage and customers.

 

As far as reputation goes, there is little that can harm you more than being caught with compliance failures. Essentially, this sends the public the message that your business is deceitful and not trustworthy with consumer information (or your message). This type of blow to a company image can be very hard to recover from. With information dissemination happening at a faster rate than ever before, the importance of reputation management cannot be overstated.

 

From a financial standpoint, compliance failures can be devastating. Not only do you face lost revenue as a result of consumer distrust, but the cost of a regulator audit can be extremely expensive and cripple business growth. The repercussions that are in place have been designed to discourage failures, so it should perhaps come as no surprise that they can be crippling.

 

How to avoid failures

Compliance regulations are constantly changing and, to be honest, you shouldn’t expect your sales or marketing team to keep up with all the specifics of the various laws and privacy regulations. However, with so much at stake, it is important that all of your team members understand the importance of complying with these standards and regulations. Below are some general guidelines that can help ensure your marketing campaigns meet these standards:

 

  • Think like a consumer: The goal of compliance regulations is to protect the public, so if you’re unsure that you are meeting various regulations, look at your campaign from a consumer’s perspective. Ask yourself if your message is clear, fair and not misleading. Will the target audience understand it etc.
  • Make compliance a priority: Again, not every employee needs to know the ins and outs of compliance, but everyone should be well aware of the regulations. As a marketing professional, you need to be mindful of the message you are putting out to the consumer, whether your organization is B2C or B2B. Is it accurate? Make compliance a priority.
  • Monitor and document: It is important that you have a system in place that monitors compliance standards. Keep an audit trail regarding key aspects of compliance, where applicable (i.e. customer-facing assets, collection of customer information, email subscription policies, procedures and processes, etc.), so that you protect your company in the face of any complaints.

 

There is still a misconception that most businesses have and believe, that compliance sits solely with the compliance function. No, compliance is everyone’s responsibility, everyone in the business has a part to play in ensuring compliance. The Compliance function should support this responsibility.

 

This is where the 3 Lines of defence come into play. It is important for any business to ensure that the responsibilities between these 3 lines of defence are clearly spelt out, well defined within the business and understood by all employees. For example, Operations becomes 1st Line of defence, the Compliance function becomes 2nd Line of defence and finally, 3rd Line of defence sits with the internal audit function and/or External audit where applicable.

 

However, it is the responsibility of the Compliance function to promote an effective compliance culture within the firm, sell the idea and importance of following best practices, equip and support the board and its senior management team in carrying out compliance correctly within the firm and raise compliance awareness via running compliance training sessions.

 

Do you need a compliance officer?

Many businesses, particularly small to medium-sized businesses, opt to make compliance monitoring the responsibility of the marketing team. While this may work in some instances, there is definite value in hiring a compliance officer.

 

A compliance officer is someone who can focus solely on ensuring that your organisation complies with regulations (laws, rules, obligations and regulatory standards) on both a domestic and global scale. A compliance specialist can stay on top of the changes and monitor marketing materials and communications to ensure those standards are met. By appointing a compliance specialist, or even an entire compliance team, you leave your sales and marketing team free to focus on their responsibilities while still protecting your company from making a costly business mistake.

 

Whether your marketing company or department is big, small, or somewhere in-between, the fact is that laws and regulations apply to you. By making compliance a company-wide priority, you can minimize your risk of compliance failures and protect your reputation and relationship with consumers. Are you complaint now? Have you even given it any thought? It’s time to start paying attention.

 

How can we help

At LS Consultancy, we offer a complete solution with a range of cost effective, regulatory compliance and marketing products and solutions including copy advice which are uniquely suited to supporting firms.

 

Explore our full range today.

 

Contact us