“The recovery still feels like a recession to many Americans and it also looks that way in some economic statistics.” — Janet Yellen
The agency business continues to be slow these days. For that matter, I’m well connected with a lot other businesses and as far as I can discern, it’s most every part of the business services category that seems to be plodding along.
Why? Well, I’ve asked a lot of people and the consensus seems to point to a new set of priorities in corporate governance at all those Fortune 1000 companies — the ones that used to dole out business to research firms, advertising agencies, and marketing consultants. The new trend favors building cash, buying back stocks, and increasing shareholder value. There’s been some dispute among the economically elite as to whether this is wise, as we saw with Citigroup trying to buy back over $1 Billion of its own stocks, and being denied by the SEC last month. Citigroup just announced that it will miss its profitability targets for this reason.
The Times says that according to Moody’s Investors Service, American companies outside the financial industry were sitting on a combined $1.64 trillion of cash by the end of 2013. And tech giants like Apple, Google and Microsoft had the most.
In fact, in The New York Times today, Apple is reportedly sitting on $159 Billion, saving it for a rainy day — i.e., opportunities for acquisition or to cushion a downturn. In the meantime, unlike Google and Facebook — which have shown themselves to be purchase-happy, almost drunk from public cash injections — Apple has never spent more than $1 Billion on any acquisition, and in the last decade it has only purchased AuthenTec, Siri, and Topsy. That’s a financial conservatism that mattress-loving misers could love.
In the meantime, if the corporate tax attorney that I met last month has any credibility at all, I’m to believe that Apple pays exactly 2% in taxes to the U.S. government each year. For me, this drudges up memories of the Occupy Wall Street demonstrations in recent years. The protesters opposed greed and pointed their fingers at the very institutions that drive business success and enable companies to employ millions — all while documenting, tweeting, and posting with their store-bought Apple products, purchased with on their self-proclaimed meager wages. Knowing that this iconic company avoids its corporate economic responsibility to our own government — even as we fight an epic deficit problem, isn’t it interesting to see such product worship by these protesters? How ironic, really.
In the meantime, we’re managing well at our firm. We’re delivering to a group of loyal clients and focused on improving our own operations and capabilities, continuing to forge new relationships. I’m especially proud of the new website we have, and most recently the new Resources page we have created, a work in process that we aspire will be an entertaining, educational look at corporate and nonprofit brands:
We have also relaunched a smart industry newsletter, element, which is poised to feature some compelling senior executive VPs in the coming months. We set out to dismiss any and all urges to promote Iridium, and to make this an objective source of ideas for marketing professionals. This is an effort I’m especially pleased with, all expertly managed by Ali Hoffman on the IridiumGroup team: