For many consumer credit firms, third-party marketing has become an essential part of customer acquisition.
Affiliates generate leads > Marketing agencies build websites > Digital specialists manage advertising campaigns > Comparison websites introduce customers > Outsourced providers create content and optimise customer journeys.
These arrangements can deliver significant commercial benefits; they can also create significant regulatory risk.
Increasingly, the FCA is demonstrating that while firms may outsource activities, they cannot outsource accountability.
Responsibility always remains with the regulated firm
One of the most common misconceptions surrounding outsourcing is that responsibility transfers with the activity itself. The simple answer is – It does not!
Whether customer communications are created internally or by a third-party agency, the FCA expects the regulated firm to retain oversight, maintain appropriate controls and ensure communications remain compliant throughout their lifecycle.
That responsibility extends well beyond financial promotions. It includes websites, customer journeys, digital content, lead generation, introducer arrangements and ongoing monitoring.
Ultimately, customers see one business; the regulator does too.
Marketing changes more quickly than governance
Marketing rarely stands still.
Campaigns evolve.
Landing pages are updated.
Content is refreshed.
Search engine optimisation changes wording.
New products are introduced.
Social media activity increases.
The challenge is that governance does not always evolve at the same pace.
What begins as a fully approved customer journey can gradually change through multiple small amendments until it bears little resemblance to the version originally reviewed by compliance.
None of those individual changes may appear significant, collectively, they can fundamentally alter how customers understand a product or service.
Approval should not be a one-off event
Many firms operate robust approval processes before marketing is published. Far fewer have equally robust arrangements for monitoring what happens afterwards.
Good governance should include:
- regular reviews of live websites and customer journeys;
- oversight of third-party suppliers and affiliates;
- documented approval processes for material changes;
- clear ownership for customer communications; and
- management information highlighting emerging risks.
Approval is not the end of governance; it is the beginning of ongoing oversight.
Third-party oversight is becoming a Board issue
Outsourcing is no longer simply an operational consideration, it is increasingly a governance responsibility.
Boards should understand which third parties influence customer communications, how performance is monitored and what assurance exists that regulatory expectations continue to be met.
That includes asking questions such as:
- Who owns this customer journey?
- How are changes approved?
- When was it last independently reviewed?
- What evidence do we have that it continues to support good customer outcomes?
These questions become particularly important where multiple suppliers contribute to the same customer journey.
The ALPH Perspective
At ALPH Legal & Compliance, we regularly help firms review governance around outsourced activities, marketing arrangements and customer journeys.
One of the most common observations we make is that compliance failures rarely arise because organisations deliberately ignore regulation. More often, they occur because governance has not kept pace with operational change.
The firms best prepared for future regulatory scrutiny are those that recognise a simple principle.
You can outsource activity, you cannot outsource accountability.
As regulatory expectations continue to evolve, organisations that invest in effective oversight of third-party relationships will be far better placed to demonstrate good governance, protect customer outcomes and respond confidently when regulatory questions arise.