COULD AD TAX REFORM BE LURKING?: While the threat of a Net Neutrality rollback is getting most of the digital media headlines in DC these days, there’s a second and potentially more insidious threat on the horizon. The issue is Ad Tax Reform, which would change the way companies can write off the cost of advertising. Right now any money spent on advertising is treated like a business expense (like buying a truck or office rent), and can be written off against the current year’s earnings. But some members of Congress are privately discussing a plan to force businesses to amortize the deduction over a 5-10 year span, which would significantly water down advertising’s tax benefit, and most likely lead to a reduction in marketing budgets. Ad Tax Reform’s proponents’ rationale for this plan is a little obscure, but InsideRadio does a decent job of explaining their motives in the attached Link. The ANA is estimating this could cost marketers over $200B in increased tax payments if it goes into effect, so it’s a pretty big deal. Not sure if this will come to fruition of not, but the topic of Ad Tax Reform is worth being versed in.
AMAZON TAKING DISTRIBUTION A STEP TOO FAR?: Believe it or not there are some products you can’t buy on Amazon. These are typically higher end or niche products whose manufacturers like to tightly control their distribution. Last week Amazon launched a new program to create a back channel distribution system in which they’ll buy these items from 3rd party retailers (who are approved to sell the items from the manufacturer), and then resell them on Amazon. By doing this Amazon gets to “sell” products it’s been prohibited from carrying by the original manufacturer. To say some brand are pissed about this move is an understatement. To quote Birkenstock CEO Dave Kahan in the attached CNBC link, “Amazon’s pathetic attempt to create a back channel means to sell products not offered on the site is an assault on decency”. Not exactly the words you want to hear from a manufacturer whose goods you’re trying to sell. My guess is with enough brand pushback this program could be short lived, as any incremental 3rd party sales might not be worth the overall headache.
SALES LESSONS FROM A CADDIE: Finally today, I know Jordan’s Spieth’s British Open win happened a week ago, but I came across this New Sales Coach post in LinkedIn over the weekend, and I thought it was worth sharing. It’s not about Jordan Spieth though, it’s about his caddie Michael Greller who arguably made the biggest impact in Spieth’s eventual British Open win. The author dissects two moments in the final round which both seemed negative for the golfer. But Greller’s contrasting approaches to each situation – one using tough love and the other building confidence – are perfectly relatable to sales management. I especially love how the article dissects the learnings from each situation for both Sales Managers and Salespeople. It’s a business lesson we can all use, from of all people a caddie on a golf course.
Have a great Monday guys!
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