In April, 57,800 consumers' cell phones received a brief text message: "0% financing on used vehicles during the biggest sale ever. Over 3000 used vehicles at Lithia Motors."
Lithia followed up with a second short text to 48,000 of those phones a week later.
Now Lithia Motors Inc. may have to pay $2.5 million to settle a lawsuit filed by a recipient of one of those messages.
The lawsuit, and a second one that has been stayed pending a resolution of the first, serves as a cautionary reminder to dealers who use a variety of new media for advertising and marketing: Don't assume you know the rules governing those new media.
Dealers must be careful when using "broadcast" text messages as a marketing tool, says Dennis Galbraith, head of research and intelligence for dealers at DrivingSales.com, an online training and social-networking site for dealers.
"When you send this mass advertising message to people's telephones, that's a completely different thing than sending a broadcast e-mail or a radio ad or television ad," Galbraith says. "The regulations are completely different when it comes to sending things to people's telephones."