Using Lists in Japan: The Affect Of New Legislation

Recently governments around the world have been busy implementing privacy laws aimed at providing individuals with protection from over-zealous direct marketing firms. But such legislation can also have an affect on the work of market researchers. Indeed this is the case for such a new act, which has been passed in Japan (and will go into affect April 1, 2005). It is well worth considering the implications of this privacy act, as it affects the management of market research projects conducted in the world's second largest economy.

The new Japanese legislation is called the "Personal Information Protection Act" and it was passed in May 2003. This act forbids both direct marketing and market research companies from using second-hand lists to contact individuals, without first having the consent from those individuals to be contacted. Moreover, that consent must be agreed upon between source of the list and the individual.

Therefore the work of getting the consent of potential target respondents needs to be completed before the study begins, by the source of the list, or the research firm can be liable for fines and penalties. Naturally what this means is that companies wanting to conduct research in Japan have to rethink what methodologies should be used for recruitment. But will that impact market research in Japan more generally?

As the use of lists becomes more limited, it is likely that we will see greater use of monitor panels for recruitment purposes. Also the use of central location tests (CLTs) using a street catch method is likely to increase in the coming months. The demand for CLT locations often outstrips supply in Tokyo, and that pressure can only increase.

One of the advantages of using lists, namely the relatively high acceptance rates achieved when compared with a more randomized approach to recruitment, will be lost. For studies with basic sample criteria, this may not be a problem. But as the sample criteria become more restrictive, panels may not be able to deliver against specialized demands placed upon them. This problem will be compounded if the study is conducted in waves, wherein the sample must be refreshed with each wave.

However, there are still ways of working with lists provided certain steps are taken. The key lies in notification and this can be done in a variety of ways. While telephone and email (to computer or mobile phone) are the preferred means, a general announcement via website or newspaper can be sufficient, provided that the individuals on the list are given the opportunity to withdraw from the list, should they wish.

Clearly in this new climate companies need to invest the time and resource to enter into a more permission-based dialogue with consumers that truly respects their rights to privacy. However, the good news is that as companies do receive that explicit permission from their customers to be added to lists for research purposes, acceptance rates should increase over time, making recruitment easier. Only time will tell!

For a more comprehensive look at this issue, please refer to "Consumer Privacy in Japan and the New Japanese Personal Information Protection Law" at the website of the Japan Market Research Association:

http://www.jmra-net.or.jp/publications/consumer.html