Online retailers, concert venues and public transport providers are among several types of companies being forced to hand over more control to consumers after a raft of measures recently brought into law, according to law firm HBJ Gateley.
Salesmen with the gift of the gab might also have to be reined in under the new rules.
Helena Brown, a partner at HBJ Gateley, said the new Consumer Protection Act, and the passing of the new Data Protection Regulation, which govern how companies can use and store consumer data, along with recent actions from the CMA on advertising practices such as celebrity endorsement, would force greater transparency into sales and marketing practices.
The bulk of the Consumer Rights Act 2015 came into force in October 2015, with the final changes due in October this year, providing a range of measures to protect the public. For example, companies will now be responsible for deliveries until they reach the customer, including liabilities for how delivery service providers behave, and must fulfil any promises made during the sales and marketing process – even if those promises were made as part of unapproved sales ‘patter’.
They can no longer avoid liability for goods or services which aren’t delivered; meaning any terms which refuse a refund if an event is cancelled would not be enforceable. However, the laws apply to any business which sells to the public.
The new Data Protection Regulations will modernise existing laws and, among other things, require companies not to contact consumers which haven’t given their explicit consent. They will also have to be more careful about profiling consumers for targeted advertising.
Helena said: “Anyone who sells to the public will have to look very hard at where they might fall short of what these new laws demand, because consumers are becoming increasingly aware of their rights and now have greater justification for making complaints.
“This is a new era of the consumer and while that’s extremely positive in lots of ways it does mean that sellers will have to consider their processes very closely. They can’t afford to have a salesperson making outlandish promises to secure a sale, if what’s being offered isn’t appropriate.
“While sales patter might be under threat, some companies may see it as an opportunity to be at the forefront of customer service and exceed these standards, which would put them in a very strong position against competitors.”
The new rules now extend standards to digital content – sellers can also be held responsible for damage to a customers’ device in some circumstances, and updates can’t be run without the user’s consent.
Sellers should examine terms and conditions to remove now-unenforceable clauses, as well as reviewing marketing materials to ensure they comply with the law.
Customer-facing staff should receive extra training and any sales scripts should be checked to bring them into line with new processes.
Helena said: “Ultimately the goal here is to give customers the confidence to buy without fear of being left high and dry if things don’t work out, and most reputable sellers will behave honourably if push comes to shove anyway.
“What these changes do is compel companies to raise the bar on customer service and transparency, and most would agree that’s a good thing. It’s a chance to stand out as a company which really cares about customers, and while there will be increased short-term costs in complying with the laws, that could create a point of difference to win more customers in the longer-term.”