INTRODUCTION
Direct Marketing refers to a type of marketing that depend on direct communication or distribution to the consumers rather than through a third party such as mass media. It is known as direct marketing because it normally eradicates the middleman, such as advertising media. One of the most known and effective marketing strategies for creating a direct link with a target consumer is direct marketing. Direct marketing is beneficial mainly for small businesses which cannot afford to advertise. Social networking has become increasingly important as countries become more linked across digital platforms. It is famous because it reduces the risk of exploitation of the consumers and protects them from various unhealthy activities like price discrimination. It is also well-known because the product or service reaches early to the consumers as compared to the other forms of marketing.
Consumers are getting exploited by various malpractices done by sellers like charging high prices, adulteration, poor quality of goods and services, hoarding etc. They are not only exploited offline but also online as apart from offline price discrimination online price discrimination also persists. As the online retailers or shops offers websites of same product at different price. Online shops can identify customers through cookies, search results, IP address etc. This information is misused by the sites to identify price-sensitive from the price-insensitive so that they can charge different prices from both. Also many retailers, wholesalers exploit consumers on the basis of caste, religion, race etc. So, for protecting consumers from any kind of exploitation Consumer Protection Act (COPRA), 2019 comes into action. This act protects consumers from various types of frauds by sellers and also provides some rights to them.
Consumer Protection Act (COPRA), 2019
Consumer Protection Act (COPRA), 2019 is the most helpful weapon for protecting consumers against discrimination on the basis of price, quality, quantity etc. It was passed by parliament in 1986 and it came into force from 1st July, 1987 and it was amended during the years 1993, 2003 and 2019. It has been presented as a significant Act in the history of India and it is applicable in every state of India and extends to the whole of India. It covers all the goods and services available in India and also provides for the formation of Consumer Protection Councils both at the centre and state level. The councils’ main aim is to protect the interest of the consumers and to safeguard them from illegal practices (like charging high prices, adulteration, poor quality of goods and services, hoarding etc.) by the sellers. There are both official and non-official members in these councils who protect the rights of consumers (like right to safety, information, choice, redressal etc.). There is a three-tier Judicial Machinery or Redressal Agencies for redressing the grievances of the consumers under the Consumer Protection Act. These are at the district level (District Forum), state-level (State Commission), and national level (National Commission).
Also Consumer Associations, state government, central government along with consumers can file complaints against seller, manufacturers, service providers etc. in these forums or commissions. Anyone under this Act can file complaints online without needing a lawyer to represent their cases. Consumers are also protected by various organizations like “Consumer Guidance Society of India (CGSI), Mumbai”, “Voluntary Organisation in Interest of Consumer Education (VOICE), Delhi”. As they helps consumers to be aware of the frauds in the market and safeguard them from exploitation. They also file cases against the sellers on behalf of the consumers.
OBJECTIVE
The objective of the study is to understand:
1) The concept of Direct Marketing and its mechanism.
2) The various forms of exploitations and behaviour of the shopkeeper towards different sections of consumers (i.e., poor, rich, urban, rural, educated, and uneducated).
3) The main target of the direct marketing with its advantages & disadvantages.
4) The modern instruments and the rights available with the consumers to protect themselves from any kind of illegal practices (like charging high prices, adulteration, poor quality of goods and services) by the sellers.
5) Understand the Consumer Protection Act, 2019 in detail
REVIEW OF LITERATURE
There are various journal articles from subscribed databases in relation to the topic and the researcher has gone through various sources for understanding the topic in an appropriate way.
1. “Direct Marketing” (Kenton, 2020)
This article by Will Kenton expresses direct marketing and its features. It guides the readers about how direct marketing works and what are its main target. The author through his article also tries to explain the advantages and limitations of direct form of marketing.
2. “How companies can make more money by allowing you to pay as you want” (Camilleri, 2018)
The article by Adrian R. Camilleri talks about the price discrimination as it informs the readers that there may be reasons for companies to accept ‘pay as you want’ pricing system and it is most effective in low competition markets. There are some of the companies like rock band Radiohead which is selling one of its albums online by this system i.e. pay what you want and by this the companies increases their revenues. Sometimes customers can pay less at pay-as-you-want businesses but this helps in generating number of customers and could drive competitors out of the market.
3. “Abuse of dominance: Pricing Practices Under Competition Act” (Paliwala, 2019)
This article by Mariya Paliwala discusses the topic of abusive pricing prohibited under “The Competition Act 2002” and further talks about how consumers protected from such abusive pricing techniques that the traders follow underlying the punishments given for such acts.
4. “Strengthening Consumer Rights: The Advent of Consumer Protection Act, 2019” by Vipan Kumar and Adya Sharma” (Vipan Kumar, 2015)
The purpose of this study is to examine and evaluate consumer understanding of consumer rights, duties and the Consumer Protection Act 1986. 77 Consumers are also, as is obvious, not only the largest economic group, but also the pivotal of all economic activities. It is also true that the customer is the most uneducated or weak group in most countries across the world. It is so concluded that extremely few individuals are aware of the Consumer Protection Act provided rights.
5. “Consumer Protection in India: Some areas of illusion” (Kaur, 1996)
This journal article by G.I.S. Sandhu and Arvind Kaur talks about the concept of consumer protection and the changes that came to it with the reform of the common law doctrine of “Caveat Emptor” (let the buyer beware). This allows the sellers to renounce their accountability as it throws the whole responsibility on the buyers. This article also discusses various movements related to the consumers and the formation of Consumer Associations, Organisations and Unions in different countries like USA, UK, Japan, Germany, and France etc.
RESEARCH METHODOLOGY
The research methodology in this research paper is descriptive as it describes the direct marketing and the situation of consumers and the protection provided to them. Also because this research paper also answers a various questions related to the topic. The study is confined to India only and the above data is totally collected from secondary sources or published sources like journals, research papers, and articles of some well know personalities etc.
DATA ANALYSES
v INTRODUCTION TO DIRECT MARKETING
Direct marketing is a kind of marketing effort which is aimed at building a personal relationship between the customer and the marketing company. The marketing organisation connects directly via one or more marketing channels with a pre-selected client list. Direct marketing is mostly based on a direct reaction - direct marketing firms must find ways to allow clients to respond directly to their marketing activities, notably on ordering and buying requests. Direct marketing contrasts with traditional publicity media which provide messages on a multifaceted basis. On traditional advertising platforms (billboards, print media, television advertisements, etc.). This marketing organisation, with the expectations that few consumers, who saw the ad would search the organisation and its products, distribute their advertising message to huge number of consumers. Direct marketing generally occurs directly with and without mass message and the use of intermediary between the marketing company and the client. There are two components for direct marketing, as we have already mentioned: direct marketing and direct distribution. In order to execute a direct marketing campaign successfully, a company must provide its customer destination with the infrastructure, data and procedures in place, and offer goods and services to buyers with a high standard of customer care. The first duty in direct marketing is channel selection and development. Marketing firms must identify marketing channels to directly inform and sell goods and services to prospective clients.
· Distribution of catalogue - The distribution of catalogues was one of the early direct marketing tactics. Manufacturers and merchants offer catalogues through the mail to assist clients who lived far from a physical store and enable them to make email orders for goods that they desire to buy. This meant that rural clients do not have to drive far to buy the goods from an agent.
· Telemarketing - Telemarketing is a direct marketing method in which the marketing organisation, by telephone, contacts prospective buyers. Some nations do not have a call-back list that allows people to opt out of uncalls, but marketing companies are still capable of marketing consumers who opt-in or have established relationships by telephone.
· Mobile and text messages - Consumers may opt into their favourite brands to get direct SMS marketing messages. Mobile marketing also exists between the company and the customer as mobile banner advertisements, push notifications, QR code and other direct methods.
· Channels of digital marketing - As a cheap, high effect alternative to traditional marketing media, the rapid move to digital commercialization has led to new and potential direct marketing channels. In order to successfully dispense your items online, organisations who offer information or software products may use these tools to link prospects to the product or service. Web-based promotion. Digital canals are among the most popular.
· E-mail Marketing – e-mails are cheap to generate, design and test and allow companies, which may submit their contact information or be registered to receive a newsletter or mailing list, to connect directly with the present customers and prospective consumers.
· Pay-per-Click (PPC) advertising — PPC advertising on platforms like Google and Facebook enables companies to link prospective websites, where sales and other marketing transitions are conceivable, to specific market groups.
· Social Media - The social media sites are efficient direct advertising platforms, since they enable direct, double-way customer connection with the company, promoting involvement and participation.
v RIGHTS AND RESPONSIBILITIES OF CONSUMERS UNDER CONSUMER PROTECTION ACT, 1986
RESPONSIBILITIES OF THE CONSUMER
Right to Safety - It is the consumer's right to be safe from goods and services that endanger his or her health, life, or property. The items and services they acquire should not only fit their immediate requirements but also their long-term goals. Consumers have a right to be protected from loss as a result of such products.
Right to be Represented - The shopper additionally has the option to get all the information about the product or service on which he bases his choice to buy items or administrations. This data pertains to the commodity's quality, purity, potency, standard, date of manufacturing, mode of usage, and so on.
Right to Choose - The consumer has complete freedom to purchase the items or services of his choice from the market's various offerings. Any seller who does so will be considered to be interfering with his right to choose.
Right to be heard - The consumer has a right to have his or her complaint heard. The consumer has the right to register a complaint against anything that is harmful to his interests under this right.
Right to Seek Redress - Customers who have been harmed by a seller's unethical business activities are compensated in this way.
Right to consumer education - Consumer education refers to educating consumers about their rights on a regular basis. In other words, customers must be aware of their right to compensation for losses incurred as a result of goods and services acquired.
RESPONSIBILITIES OF THE CONSUMER
Consumers have a number of rights when it comes to purchasing goods, but they also have certain duties. It indicates that when buying goods or getting services, the consumer should keep a few things in mind. The following are the details:
The consumer must exercise his or her right - Consumers have numerous rights when it comes to purchasing goods and services. They should know about their privileges prior to buying. The right to wellbeing, the option to be educated, the option to be addressed, the option to look for change, and the right to shopper schooling are only a couple of these rights.
Cautious Consumer - When purchasing something, buyers should make full use of their reasons. They should not accept the seller's word as gospel.
Filing a complaint to seek satisfaction of legitimate grievances - It is the consumer's responsibility to contact the appropriate authority if they have a complaint about the goods they have purchased. Consumers are sometimes blind to businessmen's trickery. This propensity promotes unethical commercial activities.
Consumers must be concerned about quality - As a result, they should not acquire inferior goods at lower prices out of greed. There can be no protection for customers if they behave in this manner. It is also the obligation of consumers to only purchase goods bearing the ISI, Agmark, Wool mark, FPO, Hallmark, or other similar markings. All of these marks indicate that the goods are of high quality.
Beware of False Advertisement - Through advertising, the vendor informs the buyer about their products. The sellers overestimate their product's quality. As a result, it is the consumers' responsibility to recognize the reality of advertising.
Remember to get a receipt and a guarantee - Purchases should always be accompanied by a receipt or bill. If the seller additionally offers a guarantee/warranty card, it should be accepted.
Do not purchase in a rush - The first and most crucial responsibility of customers is to not buy in haste. They should also consider the location from which they will purchase the items.
v THE CONSUMER PROTECTION ACT'S THREE-TIER CONSUMER GRIEVANCE MACHINERY
· DISTRICT FORUM
The district forum is made up of a president and two additional members. A retired or present District Court judge could be the president. They are appointed by the state government. This agency is able to handle complaints for goods or services worth up to Rs, 1 crore. If necessary, the agency sends the items to a laboratory for testing, and then makes choices based on the facts and the laboratory findings.
· STATE COMMISSION
It is made up of a president and two additional people. The president must be a retired or active high court judge. The state government appoints them all. The State Commission can receive complaints for items valued more than Rs 1 crore but less than Rs 10 crore. When the State Commission receives a complaint, it contacts the complainant and requests that the goods be tested.
· NATIONAL COMMISSION
A president and four members make up the national commission, one of whom must be a woman. The central government appoints them. If the value of the items exceeds Rs 10 crore, a complaint can be lodged with the National Commission. When the complaint is accepted, the opposite party is notified. The National Commission, like the State Commission, has the authority to provide the accused party one or more directions. If a party is dissatisfied with the National Commission's judgment, it has 30 days to file an appeal with the Supreme Court, subject to jurisdiction, which includes cases involving a sum exceeding Rs. 1 crore.
v THE CONSUMER PROTECTION ACT VERSUS DIRECT MARKETING IN ACCORDANCE TO SECTION 11 AND 12 OF CONSUMER PROTECTION ACT
The Consumer Protection Act of 2008 (CPA) provides for consumer assistance in combating undesired, unwelcome direct marketing communications. The CPA defines "direct marketing" as an approach to a person for the direct or indirect purposes, in the normal course of business, of promoting or offering to provide any product or service in person or by e-mail or electronic communication. Electronic communication comprises telephone, fax, SMS, wireless connection to computer, email or any other technology or device. Telesales are also included by this definition. Section 11 of the CPA does not mean that consumers are empowered to decline direct commercial messages. Further it outlines in detail what the legislature plans to do to restrict or ban the communication of direct marketing. First of all, a person under direct marketing communication may require the person who initiates the contact to withhold any future communication; Secondly, the Commissioner may, against any communication primarily for direct marketing purposes (the Rules contain detailed regulations relating to the establishment of this Registry), establish a register in which any person may register, either generally or for specific purposes, a pre-emptive block. Third, an authorising person or directing person or conducting any direct marketing shall implement suitable procedures to facilitate the receipt of a precautionary blocking application (as envisaged above) without directing or permitting any person involved in the activity to direct or provide any direct marketing communication to any person who has made a pre-emptive blocking request. Fourthly, no one can charge a customer a fee for applying to prevent or register a pre-emptive block for direct marketing communications. The register provided for in Article 11 of the CPA has not yet been established as set forth in the Regulations. Until the Minister has proclaimed these provisions to be effective, the application of applicable CPA and Consumer Registration laws shall be postponed. Consequently, consumers are now unable to prevent direct marketers from using their details.
RECOMMENDATIONS/SUGGESTION
All current consumers should affirm that they want the provider to continue to receive direct marketing. The supplier shall not contact the client without the current customer confirmation; otherwise if they do not have your consent, they are not allowed to contact you. The right of consumers to market fairly and responsibly is addressed under the Consumer Protection Act (CPA). The right to privacy, which restrains unwelcome direct marketing, goes hand in glove. There is therefore the obligation to accept and pay back money for the value of the goods returned and for monetary consideration as stated on the contract if the independent distributor to any direct-sales companies has sold a number of goods and requested a financial account, discount, commission or return of goods, according to the rights stated in the contract. The Consumer Protection Board is an authority which has the responsibility to protect the rights of consumers, promote equity and be used in order to purchase goods and services from businesses, promote consumer awareness in the purchase of goods, services and promote and enhance coordination between consumer groups and networks.
Two potential answers are available:
· Change to ensure the free opt-out obligation for the applicable provision of the CPA only covers unwanted direct marketing. This legitimizes requested direct (opt-In) marketing using an opt-out SMS standard rate. Unwanted direct marketing via text messages will then continue to be unlawful.
· Present all networks with toll-free SMS numbers that may be used as an opt-out.
· The expense of the opt-out SMS is borne by the telecom service provider (WASP)
· The network operator should bear the expense of the opt-out SMS
Although step two above would legitimize spam, customers may penalize senders of unsolicited mail simply by answering the sender in masses. Anti-spam campaigners are also expected to release special, faultless SMS numbers extensively. It may even be possible to filter out any messages with the words "respond STOP" on some devices and if the answer to the WASP is loaded the phone may be configured to fire out a stop message automatically. These are only a few of the criteria laid out in the Act. In order to establish suitable terms and conditions in compliance with the law and business needs, it is extremely important that everyone examine their connections with its consumers. All company owners must consult a legal professional to find out which areas must be covered, in order to offer consumers with the fair environment set forth in the Act for their present terms and conditions.
CONCLUSION
Without protecting the consumer's rights, no economy can prosper. A consumer is an essential player in any economy since it is the one who buys or hires the seller's products or services and promotes employment in the country. The protection of consumer rights is vital since, as a consequence of globalization and increased knowledge, consumer needs and expectations have altered in the present day. However, it occasionally becomes damaging to consumers because a broad range of goods and services are available, since not all sellers and service providers are real. In order to deal with and safeguard the interests of the customer, a Consumer Protection Act of 1986 was created. At the time, it was a praiseworthy step and was occasionally modified. The three-decade law, however, was not up to speed with advances in the country's economy and digital technologies. For example, the law did not grant the right, and the State and District Consumer Rescue Forums had to be contacted which would only pay consumers for losses they had induced, to bring proceedings against a person who has infringed consumer rights. No information or inquiries about injuries or fatalities due to faulty products or services were made. No information was provided. In summary, no regulatory agency was available for monitoring or monitoring the infringement of customers' rights. Now, the Parliament's adoption of the Consumer Protection Act of 2019 and the abrogation of the Consumer Protection Act in 1986 have marked the start of a new phase of consumer rights in China which has strengthened consumer rights. The most important aspect of the Consumer Protection Act of 2019 is the creation of a Central Consumer Protection Authority to "promote, defend and implement class consumer laws." The new rules show the obvious change from Caveat emptor to a Caveat seller (let the seller know) as the unfair trade practice and fraud carried out by the seller will now be penalized. The seller will be informed of this transition. It also provides for prosecution of unfair trading practices and deceptive advertising and many other improvements that bring consumer rights up to speed with current market trends. This article discusses the main features of the Consumer Protection Act 2019 ideas. In comparison with his previous equivalent, a humble attempt has been made to examine and assess various changes made under the Act.
BIBLIOGRAPHY
I. Camilleri, A. R. (2018). How companies can make more money by allowing you to pay as you want. 1-3.
II. Kaur, G. S. (1996). Consumer Protection in India: Some areas of illusion. 377-386.
III. Kenton, W. (2020). Direct Marketing. Investopedia.
IV. M/s Sai Wardha Power Company Ltd vs. M/s Coal India Limited and its subsidiaries (Bombay high Court January 28, 2014).
V. Noida Software Technology Park vs. Star India Pvt. Ltd. & Others, 30 (High Court of Delhi July 27, 2017).
VI. Paliwala, M. (2019). Abuse of Dominance : Pricing Under Competition Act.
VII. Paliwala, M. (2019, december 10). Abuse of dominance: Pricing Practices Under Competition Act . Retrieved from Ipleaders: https://blog.ipleaders.in/abuse-of-dominance-pricing-practices/
VIII. Shri Shamsher Kataria v. Honda Siel Cars India Ltd & Ors., 03/2011 (Delhi High Court august 25, 2014).
IX. Vipan Kumar, A. s. (2015). Strengthening Consumer Rights: The Advent of Consumer Protection Act, 2019. SEBI and corporate laws, 7.
WRITER:
NAME: SANKET DHULL
COLLEGE: Symbiosis Law School, Hyderabad
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