The lead generation industry is under siege. Consumers are tired of robocalls. Lead generators and publishers are concerned about fraudulent leads that can lead to TCPA lawsuits.
The FCC looks to close the “lead generation loophole” and prevent third parties from sharing interested consumers with potential sellers. It seems the only players in the lead generation industry who aren’t worried are the bad actors—the very ones who have created many of these issues in the first place.
Can this industry be saved? Eric Troutman thinks so. A prominent attorney who represents lead buyers, large brands, and direct-to-consumer (DTC) marketers in TCPA lawsuits, Troutman noticed that claimants’ attorneys were arguing the leads his clients had purchased were not real, the consumers had not given consent because they weren’t the ones who visited the website and filled out the form.
That observation led to learning more about how and how many fraudulent leads get through the chain. What he learned prompted him to assemble a powerhouse team to establish and lead Responsible Enterprises Against Consumer Harassment (REACH). REACH is a mutual benefit corporation on a mission to get the lead generation industry to regulate itself with uncompromising standards that could eliminate as many as one billion unwanted robocalls per month.
It’s Time to Get Real
Legitimate lead buyers and sellers want genuine leads: actual consent from real people who want to hear about their goods and services. That’s what sellers claim to be selling and what buyers think they’re buying. But that isn’t what’s happening in every case.
We need, and REACH standards require, accurate fraud detection because that’s where the problem starts; an estimated 25 to 30% of leads being sold are fraudulent. The information provided may be legitimate, but it has been stolen and entered by bots or human fraud farms, not real consumers.
These fraudulent leads are sold to multiple lead generators, who in turn may sell them to multiple lead buyers. This leads to consumers, who did not request information and did not give consent to be called, receiving numerous phone calls—billions of them. And those unwanted calls lead to TCPA lawsuits and intense government scrutiny.
That’s why Troutman thinks the lead generation industry must commit to regulating itself before the government steps into it even further. Those in government try to do the right thing to protect consumers. Still, without industry expertise, they often end up under-regulating or, even worse, over-regulating, which can stifle or potentially kill an industry. This robs legitimate businesses of the opportunity to sell their services to interested parties and throttles the flow of offers to buyers who actually want and need them.
By agreeing to adhere to the tough industry standards established by REACH, members demonstrate their commitment to taking consumer privacy seriously. This would help build trust among all parties involved, including regulators. They can then focus on going after the bad actors in the lead generation space and allow the good guys to carry on, providing legitimate leads and serving interested consumers. These efforts can create a positive experience for lead buyers, sellers, and consumers.
Lead Generators, We Have an Image Problem
Bad actors have stained the lead generation industry’s reputation. Consumers are soured on marketing in general and specifically on lead generators who just keep selling their contact info. Since they don’t know what to expect by filling out an interest form, many shy away from doing so. To date, the lead generation industry has not been well-represented to consumers, regulators, or legislators.
That’s why another of REACH’s missions is to change the perception of the lead generation industry. There are a lot of really good people in this industry who want to help their customers sell good products and services by responsibly connecting buyers to sellers.
REACH will proactively provide positive responses to negative media reports about robocalls or telemarketing. Messaging will focus on the positives, such as convenience for consumers who can obtain information and services by phone, which is particularly useful where there are no physical locations, especially in rural areas of the country. This proactive outreach will extend to the FCC and other regulators to establish rapport and earn respect for responsible lead generators.
These actions will help build credibility and trust so that when consumers see the REACH label on a website, they can trust that their personal information will be protected and responsibly shared. Next steps will be clearly spelled out, including the robocalls that will provide the requested information. The organization hopes to get wireless carriers to agree to label REACH members so that consumers will answer the calls and not report them as unwanted robocalls.
Another aspect of building trust in the lead generation industry is calling out the bad actors and sharing information with regulators and other stakeholders to bring awareness to those who continue to re-sell fraudulent leads. The ultimate goal is to expel those not acting in good faith. Similar efforts will go toward litigators who abuse TCPA’s private right of action.
The goal of these outreach efforts is to remind all concerned that, when done properly, telemarketing is a good thing. Comparison shopping websites are a good thing. Legitimate lead generation, consumers being connected to products and services they are interested in, on their own schedule, is a good thing. These things just need to be done right, and REACH’s strict standards will help ensure that happens.
Where Does Anura Fit?
While Anura was initially developed to stop ad fraud, not lead fraud, we instantly recognized the similarities. It was apparent that similar fraud rates and some of the things leading to fraud on the performance marketing side were causing the same issues with lead generation. And after meeting Eric at trade shows and hearing him speak about the challenges in this space, we recognized the potential synergy in our efforts to fight back.
We have gotten to know a lot of good players in the lead generation space and know they aren’t the problem themselves; it’s the invalid traffic coming to their sites and creating fraudulent leads. We both feel invested in helping fight fraud in this space for the good of the industry and consumers. As a result, Rich Kahn, our co-founder and CEO, enthusiastically joined REACH’s board and continues to serve on the board of directors for the Consumer Consent Council, which has its own lead generation standards.
The industry has its work cut out for it. Still, we are encouraged to see self-directed movement in the right direction. REACH is quickly making headway, submitting comments to the Centers for Medicare and Medicaid Services as well as to the FCC, asking the regulators to consider adopting REACH standards regarding contact by phone and/or text, instead of the proposed direct consent.
While we can’t solve all the industry’s issues, Anura’s technology can help detect and block fraudulent traffic that results in fraudulent leads. We’re actively working with both organizations, asking what we need to do to help support this industry. We are committed to living up to the established standards, which we have suggested include fraud solutions that live up to the standards set by the advertising industry.
There are more than a hundred fraud solutions in the market, but only a few are certified by TAG or accredited by the Media Ratings Council (MRC). Anura is TAG Certified Against Fraud, and we plan to be there for the organizations that can help the industry self-regulate and save itself, along with the thousands of businesses that are involved in and depend on lead generation.
Learn more about REACH and how you can get involved. Stay tuned and stay informed about our efforts to defeat fraud and save the industry.