Understanding the TCPA and Its 2025 Updates: What Consumers Need to Know to Protect Their Business

Key TCPA Compliance Requirements For SMS Marketing

In today’s digital age, information, social connection, and advertising are at the fingertips of all consumers. It is up to marketing teams to use a wide array of communication tools to reach customers, from phone calls to social media. Every method comes with its benefits and drawbacks. Our experience has proven SMS marketing is a highly effective and immediate method to engage with consumers though it comes with significant legal obligations. The Telephone Consumer Protection Act (TCPA) governs SMS/text messaging and other telemarketing practices. Understanding TCPA compliance is crucial for successful campaigns and a positive relationship with customers.

This article, based on our 30+ years of experience in the ever-changing world of advertising, will highlight the key compliance requirements and offer practical steps for adhering to SMS regulations.

What Is The TCPA?

TCPA was enacted in 1991 following the rise of telemarketing in the 1980s and 1990s. Thanks to the automated systems that gave businesses the power to reach out to thousands of people over the phone, regulations needed to be implemented to limit unsolicited and intrusive telemarketing practices. It was expanded to include SMS and other communication channels. The Federal Communications Commission (FCC) enforces the TCPA and ensures violations lead to severe financial penalties. Companies that use automated dialing systems, pre recorded messages, or SMS marketing without proper consent can face fines ranging from $500 to $1,500 per violation.

TCPA regulations apply to several types of communications, including telemarketing calls, robocalls, SMS and MMS text messages, and faxes. This shows that the TCPA is adaptable and has the lasting power to protect customers whatever new communication channels might arise.

TCPA’s Importance In SMS Marketing

As we all know, cell phones have become crucial to everyday life. Our research now shows that SMS has become a preferred communication tool for businesses, allowing them to send promotions, reminders, and important updates directly to the customer. SMS reaches customers where they already are. However, the ease and effectiveness of SMS marketing has also made it a target for spam. Customers can easily get irritated when a communication channel that is so heavily relied on becomes clogged with unnecessary advertisements. The TCPA aims to protect customers from being overwhelmed with unwanted messages. The TCPA ensures businesses maintain ethical communication standards and preserve positive customer relationships.

Key TCPA Compliance Requirements For SMS Marketing

Compliance with the TCPA enforces specific measures companies will need to take when organizing their marketing campaigns.

  1. Prior Express Written Consent
    Under the TCPA, businesses must obtain prior express written consent from consumers before sending any SMS or text message for marketing purposes. This is the best way to avoid customer frustration at receiving text messages from companies. Customers need to be able to choose whether they wish to receive communications through this vital method. Consent must be explicit and informed, meaning that customers must knowingly agree to receive SMS communications. This includes:
  • Clear Opt-In: Consumers must provide a clear and affirmative indication of their consent, typically by checking a box on a website form or replying “YES” to a text message.
  • Disclosure: Companies must clearly disclose what types of messages the consumer is consenting to receive. This includes outlining the nature of the promotions, the frequency of messages, and the possibility of standard messaging rates applying.

For instance, a compliant opt-in message might state:
“By entering your phone number and clicking ‘Subscribe,’ you agree to receive marketing text messages from [Business Name]. Consent is not a condition of any purchase. Message and data rates may apply. Reply STOP to opt-out at any time.”

  1. Opt-Out Mechanism
    The TCPA requires that all marketing SMS messages include a clear and easy method for opting out. Typically, this is done by instructing the consumer to reply with the word “STOP” or a similar keyword. The opt-out process should be simple, immediate, and free of charge. Frustration can easily emerge when the opt-out process is unnecessarily complicated or does not fully stop the communication.

    Upon receiving an opt-out request, businesses must immediately cease sending further messages to that customer. Additionally, the business must send a confirmation message to inform the consumer that they have successfully opted out.
  1. Time Restrictions on SMS Messages
    TCPA mandates specific time restrictions for sending SMS marketing messages. Businesses are only allowed to send texts between 8:00 AM and 9:00 PM in the recipient’s local time zone. Sending messages outside of these hours can be considered intrusive and is a violation of the TCPA. It’s essential to configure messaging systems to ensure compliance with these time windows.
  2. Proper Identification of the Sender
    Businesses must clearly identify themselves in every SMS message they send. The consumer should never be confused about who is contacting them. This can be done by including the business name in each message, even if the SMS is part of an ongoing marketing campaign. Additionally, businesses should ensure that their contact information or website is easily accessible for any queries or further actions by the customer.
  3. Record Keeping
    Maintaining comprehensive records is essential for TCPA compliance. Businesses must keep records of the following:
  • Consent Forms: Copies of the opt-in consent, whether digital or physical, should be retained for each consumer.
  • Opt-Out Requests: Businesses should maintain records of when consumers opted out and any confirmation messages sent to them.
  • Messaging Logs: Documentation of all marketing messages sent, including the time, date, and recipient information, should be kept.

This record-keeping practice is invaluable in case a dispute arises. In the event of a TCPA lawsuit, a business must demonstrate that it obtained proper consent and adhered to compliance guidelines.

  1. Automation and the Use of Auto-Dialing Systems (ATDS)

The TCPA has specific provisions regarding the use of automatic telephone dialing systems (ATDS), which include any system capable of sending automated text messages. The use of ATDS without express consent is strictly prohibited. Companies using such systems for SMS marketing must ensure that they obtain express written consent and that their systems can handle opt-out requests properly.

In light of recent court rulings, the definition of ATDS has been expanded. Businesses should regularly consult legal counsel to ensure that their systems comply with the latest interpretations of the law.

Penalties For Non-Compliance

Violations of the TCPA can result in severe financial penalties, often in the form of class-action lawsuits. The penalties for non-compliance are calculated as follows:

  • $500 per violation for each unsolicited call or text message
  • Up to $1,500 per violation if the violation is deemed willful or knowing

Given that these fines are applied per message, companies can quickly face millions of dollars in penalties for non-compliant SMS marketing campaigns. In 2021, several high-profile businesses faced class-action lawsuits resulting in settlements of millions of dollars, highlighting the seriousness of TCPA violations.

Best Practices For SMS Compliance

Compliance with the TCPA is vital to a successful marketing campaign. Our research has outlined the following best practices for SMS compliance to ensure both successful communication and customer relationships. 

  • 1. Include Disclosures in Every SMS

While initial consent disclosures are essential, it is a good practice to include key disclosures in every marketing message. This can include a brief mention of how to opt-out (e.g., “Reply STOP to unsubscribe”) and a reminder that message rates may apply.

  • 2. Use Consent Management Software

Many companies are now investing in consent management software to help track consumer opt-ins and opt-outs more efficiently. These systems allow businesses to easily manage their marketing lists, ensure compliance with TCPA requirements, and keep records of all consents and withdrawals.

  • 3. Conduct Regular Audits

TCPA compliance requires continuous monitoring and updating of marketing practices. Regular internal audits can help identify potential risks and ensure that messaging systems are functioning in accordance with the law. This includes checking whether all messages have proper opt-in documentation and that opt-out requests are being processed correctly.

  • 4. Consult Legal Counsel

Given the complexity of TCPA regulations and the potential for costly lawsuits, businesses should regularly consult with legal counsel specializing in telecommunication laws. Legal experts can help interpret the latest changes to the TCPA, ensure that consent language is appropriate, and review automated dialing systems for compliance.

  • 5. Train Marketing Teams

Ensuring that marketing teams are well-versed in TCPA regulations is critical. Companies should provide ongoing training to staff on the legal requirements for SMS marketing and the proper processes for obtaining and managing consumer consent. Empowering employees with the right knowledge will reduce the risk of accidental non-compliance.

Recent TCPA Developments

The interpretation and enforcement of the TCPA continues to evolve, especially as courts and lawmakers address modern communication technologies. The Supreme Court’s 2021 decision in Facebook, Inc. v. Duguid redefined what constitutes an ATDS, significantly narrowing its definition. As a result, businesses should stay informed of any regulatory updates or court rulings that may impact their SMS marketing practices.

Conclusion

TCPA compliance is an essential aspect of any SMS marketing strategy. By adhering to the law’s requirements—especially obtaining express written consent, providing a clear opt-out mechanism, and respecting time restrictions—businesses can protect themselves from costly fines while maintaining a positive relationship with their customers. Regular audits, legal consultations, and employee training will further strengthen a company’s compliance, ensuring that SMS marketing efforts remain effective and legally sound. Implementing the best practices outlined in this guide can help companies navigate the complexities of TCPA regulations while reaping the benefits of SMS marketing.