SMS Marketing

The Cost of Non-Compliance - TCPA and SMS Compliance

March 16, 2023

Written By

The Via Team

SMS marketing can be a highly effective way to reach customers and promote your business. There are regulations in place to protect consumers from spam and unwanted messages. Failure to comply with these regulations can result in costly consequences. Understanding SMS marketing laws is essential to avoid fines and legal issues. 

What is TCPA and SMS Compliance?

SMS compliance refers to the rules and regulations governing text messaging for marketing and communication purposes. These rules are designed to protect consumers' privacy and prevent unwanted messages or spam from flooding their phones. Businesses must comply with these regulations to avoid penalties, lawsuits, and legal ramifications. 

The Telephone Consumer Protection Act (TCPA) is a federal law regulating telemarketing calls, text messages, and faxes in the United States. The law was enacted in 1991 to protect consumers from unwanted and harassing phone calls and messages. Under TCPA, companies are required to obtain prior express written consent from consumers before contacting them with telemarketing calls or messages. The law also establishes certain restrictions on automatic dialing systems, artificial or prerecorded voice messages, and unsolicited faxes. TCPA violations can result in significant penalties and fines, making compliance with the law a critical concern for businesses engaged in telemarketing activities.

So, in short, if you want to stay out of court, get permission from your consumers and give them the option to opt out of text messages if they don’t want them.

What Happens if I Don’t Follow TCPA?

The cost of non-compliance can be high, with businesses potentially facing hefty fines, legal fees, and damage to their brand reputation. For example, in 2020, the Federal Communications Commission (FCC) fined three companies over $40 million for violating the Telephone Consumer Protection Act (TCPA), which regulates telemarketing and SMS communications. These fines can cripple a business, especially smaller ones, and have a long-lasting impact.

In addition to financial penalties, non-compliance can also result in reputational damage. Negative media coverage, customer complaints, and loss of trust can harm a business's reputation, making it challenging to attract and retain customers. This damage can take years to repair, and the business may never fully recover from it.

Another cost of non-compliance is the loss of business opportunities. SMS marketing is a powerful tool for businesses to engage with customers, build relationships, and drive sales. However, if a business is not compliant with SMS regulations, it cannot use this channel effectively, potentially missing out on valuable opportunities.

What Can I Do to Prevent Non-Compliance?

To avoid the cost of non-compliance, businesses must understand the regulations governing SMS communications and take steps to ensure compliance. This includes:

  1. Obtaining consent from customers before sending messages
  2. Providing an opt-out option, and maintaining accurate records of consent. 

Additionally, businesses should monitor their SMS communications to ensure they are in compliance and train their staff on SMS compliance regulations.

Let’s Wrap This Up

The cost of non-compliance with SMS regulations can be significant, both financially and reputationally. Businesses must take appropriate measures to ensure compliance, including obtaining consent, providing opt-out options, and maintaining accurate records. Failure to do so can result in hefty fines, legal fees, and damage to their brand reputation. By understanding the regulations and taking appropriate measures, businesses can leverage SMS marketing effectively while avoiding the cost of non-compliance.

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