Direct Marketers Oppose the Internet Sales Tax
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Direct Marketers Oppose the Internet Sales Tax

This was a national project that relied upon successful media outreach to targeted press in Washington D.C., whose support was critical to ensure that Congress granted an extension to the moratorium on Internet sales tax

Paul Holmes

This was a national project that relied upon successful media outreach to targeted press in Washington D.C., whose support was critical to ensure that Congress granted an extension to the moratorium on Internet sales tax. This was an issue that was glossed over in many mainstream media outlets, paving the way for certain direct business and tax publications to take the lead on the story.

By the time The MWW Group was retained for this project, a handful of small publications in the Beltway “owned” the story and were the preeminent experts that federal lawmakers were turning to for information. Unfortunately, they sided with our competing factions on this issue. Our job was to woo them to our side.

This campaign exemplifies the ideals that Sabre sets forth by achieving thousands of media impressions nationwide, creating a critical swing in public opinion. This was a “David v. Goliath” campaign, in which it took smart thinking and resourcefulness to conquer an entrenched enemy with countless resources.  Our media campaign convinced the likes of The Wall Street Journal and The New York Times to reconsider their stance on the issue of Internet taxation – and give our client the equal press it needed to successfully sway Congress.

Our Challenges & Opportunities

On behalf of the Direct Marketing Association (DMA), our objective was to brand the DMA as the premier expert regarding the issue of Internet sales tax.  It was a daunting task: the client did not provide us with the “talking heads” we needed for a sweeping campaign. Although the DMA represents more than 5,000 direct mailers internationally, the organization allowed us only to pitch one individual, a vanilla tax counsel with a large department store chain. While this individual was certainly knowledgeable about the complex issue of 7,600 varying sales tax codes nationwide, he was not the compelling media draw that would ensure the DMA would lead this issue in the halls of Congress and in the targeted specialty press. To accomplish this goal would require something special.

Some background: The DMA has consistently been against sales tax on Internet commerce, and hired The MWW Group to help ensure Congress does not lift the moratorium. We were instructed to use their one spokesman to force Congress to extend the current sales tax moratorium indefinitely. We were instructed to go up against such wealthy brick-and-mortar giants as Wal-mart and Target, and convince Congress and the business media to side with us. Our budget was a shoestring ($17,000 a month), as compared to the funds the retail giants poured into their coalition, E-fairness.

With any chance of success, we had to maximize our assets and develop a strategy that would make this handful of business reporters take notice. Our argument: It would destroy e-commerce if these small, fledgling companies are required to remit and collect sales tax for 7,600 varying rates around the country.

They would need an army of accountants to comply with such a mandate and would be driven out of business. Congress must significantly simplify the rates, and establish one sales tax system per state. Until that happens, which would take decades to enact, the moratorium must continue.

Research/Objectives

To be effective in this campaign, we needed to catch up on an issue that had been brewing for at least three years. Staffers used web-based research tools, such as Lexis-Nexus, to review the previous news coverage in The Wall Street Journal and The New York Times. Such research benefited the campaign in two ways: The old clips provided us with information about the major landmarks of the issue and helped us understand how the press was covering the issue. It was evident at the time that the major reporters on the story, as well as the key editorial boards, sided with the E-fairness Coalition.

Our objective: to convince targeted reporters and editors to re-approach the issue and report that it is beneficial to the American economy if sales tax revenue is not collected on remote sales.
Anyone involved in working with the media knows how difficult it is to convince a news outlet that its prior reporting was misdirected and misinformed. But at such a late stage that we were entering the fray, we had no recourse.

Strategic Approach

We needed to turn the tide… and quick. With little guidance from the client, we hit the phones of targeted outlets nationwide, incessantly chatting with producers, editors and reporters who cover business, technology & Internet issues. Our fingers were on the pulse of Capitol Hill. We linked up with the offices of Congress members who had sided with us on the issue, and worked with their press liaisons to target allies in the media.

Our objective was to become “the officials” on the issue, and released media alerts every week to key reporters about upcoming events and hearings in Congress. Our goal was to own the story. We needed to be one step ahead of the E-fairness Coalition, and Congressional leaders who were determined to make sure Internet companies “pay their fair share.” We were determined to be the source on Internet sales tax.

Target Audience(s)

Major daily newspapers (especially within the Beltway)
National news service organizations (A.P, Reuters, etc.)
Broadcast
Internet trade magazines
Tax publications

Campaign Execution

As Congress debated this issue through the summer months, we were religious attendees at House and Senate subcommittee meetings on the Hill, as well as forums, debates and hearings on Internet taxation. Armed with duffle bags of updated press kits, we made sure every lawmaker, reporter and Congressional staffer consistently knew our client’s position.

We became a regular piece in the fabric of the debate, and a thorn in the side of E-fairness. We led the charge in the media, challenging Wal-mart to a live debate that appeared on C-Span, forcing opposing lawmakers to comment to the press about why they want to drive out small e-tailers and serving as the preeminent information board, through our website, www.simplifytax.org, which MWW designed itself. We took our show on the road, bringing our clients to editorial boards from The Wall Street Journal to The New York Times, from The Oregonian to the Arizona Republic. (A full list of meetings is attached.)

Results Summary

Through four months of intense phone work, client meetings, media tours and hearings in Washington D.C., our persistence paid off. The DMA evolved into the leading online taxation expert, through the coverage generated in the media, with a total audience reach of 225,070,088. In every case when an important vote on the issue was imminent on Capitol Hill, the DMA would be called upon for its opinion.
Congress was forced to take notice, as our small but strong, steady voice shaped remote commerce taxation law. Our efforts were a driving point in Congress’s decision to extend the moratorium through June of next year. Our new fight will begin then, as we work with the DMA to ensure the moratorium stays in place for as long as possible.

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