They regularly clog mailboxes and leave people annoyed: election advertising, company mail or the latest discount codes. The unwanted mail is addressed to you and the question quickly arises: Where did they actually get my address from? This is not always easy to answer in special cases. In general, however, the answer is simple: the companies probably get them from so-called address dealers.
These are companies that collect a lot of different data from people, bundle it and sell it to advertisers, for example. This includes address data as well as information about a move or people’s preferences, everything a company needs to acquire new customers. The German Dialogue Marketing Association estimates that there are more than a thousand address dealers in Germany alone. The largest include Deutsche Post and AZ Direkt, which belongs to Bertelsmann. Address trading is a lucrative business for them, but a nuisance for consumer and data protection advocates. The recipients, critics complain, often do not even know who knows their address or not-so-secret preferences and what this information is actually used for. And so they ask themselves again: Why am I actually being sent this?
A ban would be disadvantageous for advertisers
The General Data Protection Regulation was supposed to eliminate this deficit in 2018, but little has happened since then. That could now change, as research by NDR and Suddeutscher Zeitung demonstrate. According to them, the majority of members in Germany’s most important data protection body, the so-called data protection conference, assume that a “legitimate interest” can no longer serve as a basis for collecting and selling address data. Instead, what is needed is “informed consent”. In plain language: Before collecting data, consumers must know what happens to their data, who gets what and what they can do with it in turn. In practice, however, this is hardly possible and fundamentally calls the business model of the address dealers into question. Is there an industry on the brink of collapse?
The German Dialog Marketing Association (DDV) is worried, its President Patrick Tapp is warning of a ban. That would have “serious economic effects, because selected mail advertising is an important motor for the European economy,” says Tapp, giving an example. For example, a regional provider of heat pumps can use address trading to address people who live in houses for which its products are suitable.
But that’s exactly what the privacy advocates are now criticizing. Stefan Brink, for example, says tailored advertising works because the industry knows the people. “Consumers must be able to defend themselves against this. Nobody has to be screened in advance for advertising purposes,” says the state data protection officer for Baden-Württemberg. He had already called for the change to informed consent in 2018. Brink justifies this with the sentence: “The consumer must have the right to live free of advertising.” Four years ago he was pretty much alone with this view, but that’s different now.
Only North Rhine-Westphalia takes a different view
“Renting or selling customer addresses for advertising purposes without the consent of the person concerned is generally not permitted,” says the state data protection authority in Berlin. More than ten federal states hit the same mark on request. They all emphasize almost word for word that it is difficult for them to imagine that the address trade can be based on a legitimate interest.
The data protectionists get support from the Federation of Consumer Organizations (VZBV). Florian Glatzner, a consultant in the Digital and Media team, says: “Consumers do not assume that a company will sell their data to other, completely foreign companies without being asked and then suddenly receive unwanted advertising from these other companies.” He therefore thinks it would be good if the data protection officers finally clarified this.
Nothing was finally decided at the data protection conference because North Rhine-Westphalia takes the opposite view and continues to assume that the address dealers have a legitimate interest in the data. Bertelsmann and Deutsche Post, two big players in the address business, are based in the federal state. A ban would be disadvantageous for them, which, according to another data protection officer, would explain the reluctance of the colleague from North Rhine-Westphalia. When asked, both companies emphasized that they assume that a legitimate interest is sufficient for address trading.
It will probably be months before data protection officials have made their final decision. However, it is taken for granted that something will change in practice. Because it is just as unlikely that North Rhine-Westphalia will prevail against the vast majority of the federal states as it is that they will give in.