It’s nice to finally meet you after all the bumpy election action we saw last year. I am expecting 2017 to be “Yuge”!
No really, the Trump administration is just getting started with all its ideas and policies. In the signature words of our President Elect “we have to figure out what’s going on."
In order to have a smooth transition through these changes, I have prepared this “beautiful” Direct Response cheat sheet just for you. As we now say in Washington, it’s “Bigly” (or “Big League” depending on whom you ask).
So 2017 let’s do this!
What’s next for Direct Response?
There is both danger and opportunity for Direct Response marketers with Republican’s controlling both the Presidency and Congress.
The first thing you should know is that there will be a general effort to roll back the excessive regulatory environment that developed during the Obama years. That’s good news for marketers. Expect some high level relief at both the Federal Trade Commission and Consumer Financial Protection Bureau. This pressure will come both internally from Trump administration appointees as well as from the Congressional oversight function.
That’s not to say that the industry should expect less enforcement action initially. For now that will still be in place. So you should continue to be vigilant about your claims and substantiation in 2017. Also you need to keep an eye on your business compliance and best practices in the year ahead.
The Republican stranglehold on power will also be “Yuge” for ERA’s self-regulation program ERSP. Industry self-regulation is a Republican favorite. As new problems arise in the marketplace expect Congress to turn to self-regulatory bodies for solutions rather than rely on new regulations or even new legislative fixes.
What about Operation Choke Point?
Operation Choke Point is an Obama administration program designed to attack the banking and payment processing relationships with high-risk merchants, including: “As Seen on TV,” Telemarketing, Sweepstakes, and Get Rich Products. The program was reported on in early 2013 with the Obama administration going after third-party payment processors. The chilling effects of the initiative have left marketers with less access to the financial services they need to survive and thrive in today’s dynamic marketplace.
I expect that regulatory action from Operation Choke Point to subside in the upcoming environment. It’s hard to imagine a lot of enforcement collaboration among agencies in the Trump administration.
Additionally, there should be renewed interest in H.R. 766 - the Financial Institution Customer Protection Act. It prohibits a federal banking agency from formally or informally requesting termination of banking activities for reputational risk alone. If signed into law, the government would no longer be able to target industries like ours for political reasons alone. This proposal previously passed the House of Representatives and its Senate companion is currently being championed by Senators Ted Cruz (R-TX) and Mike Lee (R-UT).
Online Sales Tax
Donald Trump has maintained an ongoing feud with the Washington Post and its owner Jeff Bezos. As you probably know, Jeff Bezos also happens to be the CEO for Amazon.com. During their feud, Trump focused on the Online Sales Tax issue and Amazon.com for not paying sales tax in many jurisdictions. Therefore my outlook has turned negative for this issue during a Trump administration.
Marketers should continue to support House Judiciary Committee Chairman Bob Goodlatte’s Online Sales Tax efforts. The Chairman’s draft would require remote sales tax to be collected based on the location of the seller, rather than on the location of the purchaser. Businesses would only have to comply with 1 set of rules, and the risk of intrusive audit and unending litigation would go way down. This is a much fairer and simpler approach than the alternatives pushed by big box retailers. Along with our allies in the TruST Coalition, ERA will continue our ongoing support of Representative Goodlatte’s efforts.
Long dormant, Net Neutrality presents another resurgent issue of concern. Trump has appointed two longtime adversaries of the policy to his transition team. The passage of the Open Internet Order in 2015 was the result of innumerable legal, legislative and regulatory battles over many years. The order classified internet providers as common carriers that fell under Title II of the Communications Act. This designation prohibits these businesses from discriminating against competitive offerings on their networks.
Trump’s pick for FCC chair will have the power to set policy and reverse this order. As Republicans will control both houses of Congress there will be no hope of legislative relief. ERA will continue its vigilance and work to ensure that you do not have to pay excessive access fees to reach your customer on the Internet Service Providers “pipes”.
Cybersecurity has consistently been a high priority for Donald Trump as well. It is clear that he will follow through with his campaign’s emphasis on this issue. We should expect the military cybersecurity debate to spill over into the civilian Privacy and Data Security conversation as well. Marketers should expect legislative activity and regulatory action at the FTC and other agencies on proposals that explore how firms deal with data breaches and theft of information.
Early indicators suggest that the Trump administration will be less stable than those administrations that we have experienced in our lifetimes, both Republican and Democratic alike. There is a higher probability of a negative Trump “surprise” moving forward. Any excessive enthusiasm over the potential of relaxed regulatory oversight should be tempered accordingly.
Stay tuned. For better or worse 2017 is going to be very, very exciting.
Bill McClellan joined ERA in January 2003 as director of government affairs. Prior to joining the association, Bill worked as a lobbyist at the Georgia Automobile Dealers Association, covering the state legislature and Georgia's congressional delegation. Before working for the GADA, Bill managed political campaigns at both the congressional and state constitutional levels