Perception vs. Reality in List Rentals

An important topic at this year’s DMAW List Bazaar was how to bring list industry guidelines and disclosure in line with actual practice… Despite setting Standards of Conduct for Non-Profit List Rentals & Exchanges back in 2008, the language in List Rental Agreements (LRAs) has not kept up with today’s commonly used industry practices. (Photo: DMAW website: www.dmaw.org)

For instance, most LRAs expressly forbid the data from being transferred to a third party, or the retention of any of that list information by any party. In reality, lists are often sent to third party vendors for the purpose of additional demographic overlays or modeling. And the use of finder files and match-back files requires the data to be kept beyond the initial usage of the file – not to mention the fact that most merge/purge vendors often retain data files indefinitely. These practices make donor data more vulnerable – especially when written agreements involving data security are not part of the transaction.

Right now, penalties for violation of these terms are large – not to mention the damage and lack of trust incurred if your donors’ personal information made it into the wrong hands. So rather than risk non-compliance, it’s time for LRAs and disclosure language to catch up with actual practices. These techniques are critically important and valuable tools for nonprofits and should be encouraged with the right disclosure and security.

The DMAW is planning on putting together an industry group to update the standards to reflect current practices. This group will consist of all the people who use lists: list brokers, list managers, non-profit organizations, agencies, merge purge vendors, modeling/data vendors, and direct marketing consultants.

Avalon will be an eager participant in the DMAW’s process, and we are well in front of this issue internally – proactively ensuring that our clients aren’t over-exposed under the old guidelines and disclosure language. 

We have implemented a procedure for our clients whereby disclosure language about potential third-party usage is required by anyone renting or exchanging a client’s list. And when our clients are renting/exchanging lists from other organizations, the agreement must state that mailable information may be retained for the purposes of finder files, match-back of web gifts, creation of various response and mailed models, and analysis of response trends – though it also stipulates that source information about the list owner will neither be retained nor shared.

Direct mail is becoming more expensive every year – and nonprofits are under pressure to direct every dollar where it will get the most return. And we have an equal obligation to steward our donors’ private information responsibly. The data techniques referenced above are executed in good faith to increase the productivity of acquisition campaigns and to build strategic donor base with strong ROI. 

It’s just time to bring those practices into the light.