Why Compliance Is Important for Business

What is the role of marketing compliance? It’s a question that resonates beyond the walls of the compliance and legal departments, echoing through every facet of modern business. The reputation of a brand can hinge on the smallest oversight, so ensuring compliance in all areas of business activity is a critical function. However, in the day-to-day landscape of navigating complex regulations, industry standards, and legal requirements  — coupled with increasing volumes of promotional content being created— the potential for efficiency remains trapped within antiquated review processes.

Lengthy manual procedures and the risk of human error are two challenges that can make the job of compliance and legal daunting, especially when it comes to reviewing content — but it also represents an opportunity to become more efficient and adaptable.

In this guide, we’ll unpack some layers of compliance and provide actionable insights aimed at helping you enact more effective marketing compliance processes.

Why does marketing compliance matter?

Regulatory compliance carries both defensive and strategic implications. In the United States, the attorney general mandates that businesses must align with CCPA regulations within a 30-day notice period. Failure to rectify issues within this time frame can lead to significant penalties — up to $2,500 per violation, whether accidental or intentional. Additionally, organizations may face a $7,500 fine for each intentional violation of CCPA provisions. 

Yet, to stop at the punitive aspects of compliance would be to ignore the wider picture. What many organizations miss is that compliance can actually be a lever for competitive advantage. While this may sound counter intuitive, this advantage becomes apparent when addressing the common challenges within organizational dynamics, particularly between marketing and compliance/legal teams. Our joint study with Arlington Research highlights this issue, revealing an ‘us-versus-them’ divide where 20% of each group feel their objectives are misunderstood by the other. With 37% of marketers and 34% of compliance teams overwhelmed by content volume, enhancing collaboration and understanding in these areas is crucial. Essentially, improved synergy streamlines compliance efforts and can elevate the overall effectiveness — as well as market competitiveness — of the organization.

Compliance across different industries 

Marketing regulations can vary significantly depending on the industry, serving as a clear indicator of the unique risks and responsibilities each sector faces.

The specifics of compliance point to a broader truth: Each industry’s compliance landscape is a framework for ethical and efficient operations. In industries such as insurance and financial services, where regulatory and legal requirements are complex and dynamic, a strong marketing compliance program can provide a strong operational differentiator.

Given these industry-specific compliance challenges, the next step is developing a targeted marketing compliance program that addresses these unique requirements.

Building a robust marketing compliance program

Constructing a robust marketing compliance program starts with conducting a risk assessment that looks into various factors: 

• What types of content are being produced? Is it digital advertising, customer communications, EDM, or out-of-home advertising?
• Analyze the amount of content submitted for review over a monthly period 
• Who is producing the content, and what is their level of compliance awareness?

After completing an assessment, you’ll be able to pinpoint vulnerabilities and inform the decisions you’ll make about the resources to allocate and the processes to establish. ​​Next, scrutinize your existing limitations and review the process:

• What guidelines, standards, or training modules are in place to educate content producers?
• How many personnel are involved in reviewing content for compliance, legal, and brand risks? What technology do they use, and at what stages of the content life cycle does the review occur?

From there, it’s essential to define specific, achievable compliance goals. These can range from introducing real-time monitoring for promotional validity, establishing a verification process for any claims made in marketing materials, and setting up mechanisms to obtain and record consumer consent in email campaigns.

After laying this foundation, a successful compliance program requires continuous nurturing, exemplified by a rigorous regimen of periodic audits and compliance training courses, along with detailed explanations of internal policies. A big part of this should involve the marketing team too. 

Ensuring that they’re well-versed in compliance can mitigate the risk of introducing legally precarious elements into material before submission for compliance review, saving time across departments. Our research found that 82% of marketers believe that, given enough experience, they can accurately gauge what’s permissible without compliance oversight. This isn’t to say that compliance becomes irrelevant; rather, it underscores that when marketers are equipped with the right knowledge and tools, their understanding helps reduce back-and-forth reviews and accelerates the compliance process. 

When we pivot our attention to the role of technology in marketing compliance, another layer of potential efficiency comes into focus. Industry-wide, there’s an evident hunger for technological solutions aimed at enhancing objectivity and diminishing bias in marketing compliance reviews — 81% of marketing and 89% of compliance/legal teams agree. The consensus is clear: The future of compliance is increasingly tied to technological advancements like automation and real-time analytics. 

For instance, automation tools can sift through massive datasets to flag potential issues, allowing compliance teams to focus on high-impact, complex challenges. Real-time analytics, meanwhile, can provide instant feedback on content against compliance metrics thereby enabling more agile and informed decision making and enhanced visibility over operational KPIs. 

The benefits of maintaining compliance

When organizations invest in robust compliance frameworks, they access a suite of advantages that propel business success. For starters, maintaining a superior standard of compliance operations enables businesses to allocate resources to growth-driven objectives. 

But perhaps the most overlooked benefit is the ripple effect compliance has on organizational efficiency. When protocols are clear, and compliance responsibilities are understood cross functionally, fewer bottlenecks occur. No longer are promotions held up by prolonged legal reviews.

Maintaining compliant and ethical standards also serves as a credibility badge for stakeholders. Investors, partners, and consumers are more likely to engage with a business they view as compliant and, by extension, reliable and trustworthy. This trust becomes a form of social capital, a valuable asset in building long-lasting relationships and customer loyalty. 

Lastly, let’s not overlook the role of employee satisfaction. A clear compliance framework and internal policies can drastically reduce workplace stress, as employees are no longer navigating a maze of uncertainty. They know what’s expected, and how to achieve it, and this clarity can lead to increased job satisfaction, which in turn enhances productivity and retains talent.

Ready for hassle-free compliance? Discover Red Marker today.

Stepping up your compliance game should be seamless and transformative. With Red Marker, you get an intuitive, user-friendly platform designed to streamline your marketing compliance process. With a broad client portfolio spanning industries such as banking, financial advisory, insurance, telecommunications, pharmaceuticals, healthcare, food and beverage, our focus is clear: Achieving outstanding compliance results while driving cost efficiency.

Our patented LegalTech Software as a Service (SaaS) platform employs advanced machine learning (ML) and natural language processing (NLP) algorithms to identify probabilistic risks in marketing and web content, in real time. This revolutionary approach ensures that expert legal and compliance reviewers can impart high-quality revisions more efficiently and consistently.

Content creators and marketers will also find value in Red Marker’s capabilities, which facilitate swift reviews of draft marketing materials. This significantly minimizes the iterative process between the compliance and marketing departments, thereby accelerating time to market.

Book a consultation today and experience the difference that Red Marker can make.