Op-Ed: Digital advertising act would hurt small business

Today in Arizona, the state is home to more than 611,000 small business — including my own company, based in Glendale. Statewide, small businesses employ more than 1.1 million Arizonans, or about 4 out of 10 workers statewide.

Small businesses help rev the state’s economic engine, we create jobs, and we help make the Valley’s neighborhoods more vibrant. It is rarely easy work, but in running a small business, I have found autonomy, financial success, and a positive way to give back to my community.

Even so, the past three years have been a lot to handle. Many small-business owners risked everything to follow a dream, only to see that effort crushed by the COVID-19 pandemic.

Then, as that crisis began to lift, supply chain woes, spiking inflation and the national labor shortage all reared their heads simultaneously. Today, many small businesses are hanging on for dear life, counting nickels and dimes to keep the doors open one more week.

Such a daunting array of challenges would be enough to keep anyone sleepless a few nights a week, but now Congress is adding to small-business owners’ woes — with a piece of legislation that will threaten the success of every business that relies on digital marketing to reach potential customers and clients.

Newly introduced, the so-called “Competition and Transparency in Digital Advertising Act” is meant to penalize a handful of mega-companies, but as with so much congressional handiwork, the bill’s unintended consequences will hurt exactly those stakeholders it purports to help.

For small businesses, the Digital Advertising Act will drastically curtail our ability to reach new and existing customers, while driving up the cost of data-driven online marketing even as it becomes less effective.

For a digital advertising agency like my business — and for our dozens of small-business clients, from car dealers to Realtors who rely on digital ads to drive their bottom line — this legislation will deepen the competitive disadvantage small businesses face compared to big businesses with even bigger ad budgets.

For Arizona small businesses, the internet has been a difference maker for years, erasing geographical boundaries, opening new markets, and lowering the cost of acquiring customers.

During the pandemic, comparatively inexpensive digital ads were a true lifeline for shopkeepers, delivery businesses and mom-and-pop restaurants, who couldn’t afford big-budget campaigns but needed to get out the word about their offerings and services.

After all small business has worked through in the past few years — and with inflation showing no signs of slowing — Congress should be focused on lowering costs for businesses and consumers, not raising them.

At a time when profit margins are shrinking and small businesses across Arizona continue to struggle, we simply can’t afford another crushing blow. The Digital Advertising Act will drive up costs and make it more difficult to engage with the consumers we need to keep our businesses afloat.

The Arizona congressional delegation would be wise to reject this ruinous legislation — because 600,000 business owners, a million employees and a state full of consumers are depending on you.

Drew Ament, founder of Press1toTalk, has been a digital advertising expert and small-business owner for 20 years.