Women's clothing retailer Talbots Inc. and its telemarketing firm have agreed to pay $161,000 to settle charges by the Federal Trade Commission that it violated the National Do Not Call Registry law last year.
The Hingham, Mass.-based company made at least 3.4 million prerecorded "robocalls" in seven telemarketing campaigns between February 2009 and July 2009, according to the FTC. During the calls, Talbots' marketing company, SmartReply, Inc., forced consumers to listen to 30 to 40 seconds of advertising, before it informed them they had the option to stop receiving automated calls. According to the commission's telemarketing sales rule, a company must tell consumers how to opt out of receiving telemarketing calls before a sales pitch is delivered.Compounding the intrusive nature of the calls, when consumers did push a button to indicate their opt-out request and discontinue the call, the telemarketers redirected them to additional recordings and advertising, according to the complaint. This also violates the FTC rule, which mandates that a company immediately disconnect a call with a consumer who wants to be put on the Do-Not-Call list.
Talbots finagled their sales pitch even further, the complaint alleges, when instead of telling recipients they could simply activate their opt-out request by stating or keying it in, the telemarketers urged, "[t]o choose whether or not to receive future calls about special offers and promotions, press 1 now or call" a toll-free number, or "[t]o make sure you'll receive pre-recorded exclusive J. Jill savings and event messages - like this one, press 1 now or call" a toll-free number.
J. Jill is another brand under which Talbots marketed clothing, in addition to its proprietary brand, until July 2009.
Under the terms of the settlement, Talbots and SmartReply were each supposed to pay a $112,000 civil penalty. Talbots will pay its full penalty but SmartReply will pay $49,000 due to financial constraints.
Talbots has been engaged in efforts of late to invigorate its brand and improve merchandise, as well as attract a younger, more fashion-forward clientele of 35 and over. The mall chain is mostly associated with tartan and plaid separates for a more mature set of conservatively dressed women.
Talbots operates stores in 587 locations in 47 states, the District of Columbia, and Canada.
Take the first steps to building your portfolio.View Course »