Retailers in California can no longer request zip codes from customers, according to the recent state Supreme Court case Jessica Pineda v. Williams-Sonoma, which reversed two lower-court decisions on the issue.
Many businesses and chain retailers request this information so as to help narrow down the address of consumers and target them directly with various marketing initiatives and materials - a practice deemed too intrusive by the California Supreme Court. However, this may impede entrepreneurs seeking incorporation in California.
However, zip code information is also used to determine the relative locations of consumers so as to identify where sales are coming from and where new branches could be opened - a less devious practice that critics are pointing to in light of the ruling.
"It's a very unfortunate opinion that's going to plague retailers who collect zip codes for very innocent purposes that have nothing to do with tracking somebody down," David Faustman, a lawyer in San Francisco, told Reuters. "And the potential damages are just massive, amounting to a violation of due process."
California attorney Donna Wilson agrees, telling the San Francisco Chronicle, "The whole idea of retailing is marketing. How do you get in contact with your customers if you're not allowed to ask for the information?"
Tags : ca, sales & marketing, small business management
Posted: Feb 28th, 2011