Klarna ‘skating on thin ice’ over email marketing gaffe

klarna appSwedish fintech Klarna, which provides online financial services to many of the UK’s leading retailers, has been forced to apologise for inadvertently sending its customer newsletter to thousands of people who had not signed up for the email missive.

The firm, which offers both buy-now-pay-later schemes and online checkout services for, among others, H&M, Halfords, River Island, Ann Summers, Asos, and Clarks, blamed “human error” for the incident.

But Klarna has refuted claims it did not have permission to hold consumers’ data and therefore breached the Privacy & Electronic Communications Regulation (PECR). It claims that simply by using its technology, consumers automatically agree to the firm’s T&Cs.

Nevertheless, PECR does state that firms must include an opt-out clause, so Klarna could well be skating on thin ice.

In a statement the company said: “We are aware that some people received our weekly newsletter by mistake. This was a human error and the email was incorrectly sent for which we are extremely sorry.

“The email was sent to Klarna consumers who have recently used one of Klarna’s products or services, including Klarna’s checkout technology. When you use Klarna you agree to our terms and conditions and our privacy notice.

“Klarna’s checkout technology is a product some retailers use to process payments on their website. This means that Klarna processes all credit and debit card transactions for these retailers. This data is used for several purposes, e.g. to help us screen for fraud, process payments, and help retailers to manage shipping in line with our terms and conditions and our privacy notice.

“Please rest assured, you have not been added to a marketing database. In accordance with our internal policies, you will not receive any further newsletters unless you opt in or download our app at a later date.

“We are currently investigating how this happened, and are taking action to ensure nothing like this can happen again in the future. We take these matters extremely seriously, and you can view our privacy policy or our service terms for our products on our website.”

Following a social media backlash, the company says it has now contacted the Information Commissioner’s Office “to ensure their understanding of the email” but a spokesman added: “At no point has customer data been compromised and the data has been used in line with our terms and conditions and our privacy notice.”

The ICO said in a statement: “Businesses should only contact individuals for electronic marketing purposes where consent has been provided or, in limited circumstances, where they have an existing relationship with a customer.

“Some members of the public have made us aware of an email sent by Klarna and we will be making enquiries.”

Launched by Sebastian Siemiatkowski, Niklas Adalberth  and Victor Jacobsson in 2005, within two years venture capital firm Investment AB Öresund invested in the company and by 2010 Klarna had opened in Norway, Finland and Denmark.

These days the company has more than 3,000 employees, most of them working at its headquarters in Stockholm. In 2019, it handled about $35bn in online sales; about 40% of all ecommerce sales in Sweden go through Klarna.

Last month, the firm expanded further by launching a new app which offers consumers personalised offers from a raft of brands, based on their interests, favourite shops and previous behaviour.

Aimed at meeting changing shopping habits fuelled by the coronavirus pandemic, the app will now cover the entire shopping journey, from discovery to final purchase and include wish lists, allowing users to save items from any retailer in the UK for personal use or to share with friends and family.

Related stories
Retail finance giant unveils shopping app for UK brands
H&M to launch ‘buy now, pay later’ for loyal shoppers
Shoppers won’t go back to brands ditched in lockdown
Covid lockdown fuels the growth of subscription Britain
Brands’ response to Covid will define business for years
Red faces at AA as email gaffe triggers hacking panic
Now Ladbrokes gets red carded for email cock-up
Coral scores own-goal with email targeting balls-up

Print Friendly

Be the first to comment on "Klarna ‘skating on thin ice’ over email marketing gaffe"

Leave a comment