Archive for January 20th, 2009

New Year, New Tax Rules … here are highlights

January 20, 2009

Excerpted from WSJ, “Wealthy Likely to Benefit Most From 2009 Tax Changes”, Jan 6, 2009

Social Security taxes. The maximum amount of earnings subject to Social Security taxes rose to $106,800, up 4.7% from $102,000 in 2008.

AMT:  Unless lawmakers do something to pass relief from the alternative minimum tax,  tens of millions of Americans will have to pay higher taxes for 2009.

Estate Tax Exemption: Starting Jan. 1, the basic federal estate-tax exemption jumped to $3.5 million from $2 million in 2008. Transfers from one spouse to the other typically remain tax-free.  During the campaign, then-Sen. Obama proposed retaining the $3.5 million exclusion amount and the 45% top rate in coming years.

Exempt Gifts: The annual gift-tax exclusion rose to $13,000, up $1,000 from 2008. This means you can give as much as $13,000 this year to anyone you wish, or to as many people as you want, without having to worry about taxes or even having to file any forms with the Internal Revenue Service. It’s a simple way to help others and reduce the size of your taxable estate. You can give even more than that by paying directly for someone else’s tuition or medical expenses. Just be sure to pay the institution directly.

Retirement savings: The maximum amount that someone under age 50 can contribute to a 401(k) plan for 2009 rose to $16,500 from $15,500. Those 50 or older can put away an additional $5,500 this year, for a total of $22,000, up from $20,500.

Standard Deductions: The basic standard deduction for joint filers for the 2009 tax year will be $11,400, up from $10,900 for 2008. For singles, the amount for 2009 will be $5,700, up from $5,450.

Stealth taxes. These refer to laws that increase taxes owed by millions of upper-income Americans without actually raising the official tax rates. They’re known as stealth taxes because they’re often complex and difficult to detect.  For the 2009 tax year, most taxpayers will begin to lose some of the value of itemized deductions if their adjusted gross income exceeds $166,800, up from $159,950 in 2008.

* * * * *

[Many Taxpayers Stand to Gain From New Laws]

Source:
http://online.wsj.com/article/SB123128601819059077.html

* * * * *

Want more from the Homa Files?
Click link =>  The Homa Files Blog

Posted in Taxes | Leave a Comment »

Private Labels Paying Off

January 20, 2009

Excerpted from the Chicago Tribune, “Shopper Pick Up Store Brands” and “Private Labels Part of Grocer’s Strategy”, both  by Mike Hughlett, November 21, 2008

* * * * *

The economy—a roiling caldron of evaporating jobs and soaring food prices—has caused shoppers to migrate to cheaper store brands at rates not seen since the last recession in 2001 … Back then, they shifted right back to name brands when the economy perked up.

But this time, the shift may be more permanent, potentially benefiting food retailers at the expense of packaged-food manufacturers. Since the last recession, supermarket chains have poured millions into beefing up their private labels, launching new brands, improving packaging and bolstering quality.

* * * * *

Shoppers increasingly find little difference between name brands and store brands, which typically cost 25 percent less. The upshot: When shoppers switch, they may be more likely to leave a name brand behind permanently.

And a successful store brand can lure customers from one chain to another, experts said. The O brand, which Safeway has put on more than 300 organic items, from fresh produce to cookies to frozen pizza, has changed some consumer’s shopping behaviors — giving them less incentive to shop at chains that focus on organic. Says one, “Now I don’t have to go to Whole Foods or Trader Joe’s.”

* * * * *

Store brands are looking and functioning more like name-brand products and are becoming more important to conventional grocery chains as a tool to help battle tough competition from both discounters.

There are myriad reasons for the store-brand offensive. First, supermarkets reap higher gross profit margins on their own brands compared with name brands—about 8 to 10 percentage points higher.

Then, there’s the Wal-Mart factor. The grocery behemoth and other discount grocery concepts continue to snatch market share from higher-price conventional chains. But because private-label products are less expensive, a robust private-label program can improve a traditional grocer’s “price image” to cost-conscious shoppers.

Edit by DAF

* * * * *

Full articles:
http://www.chicagotribune.com/business/chi-fri-private-labels-consumersnov21,0,3045032.story

http://www.chicagotribune.com/business/chi-fri-private-labels-stores-nov21,0,7919897.story

 

* * * * *

Posted in Mktg - Brands, Mktg - Brands - Private Label | Leave a Comment »

The Numbers Don’t Lie: Competing on Analytics

January 20, 2009

Excerpted from Knowledge@Emory, “The Value and Benefits of Competing on Analytics”, November 13, 2008

* * * * * 

A lot of companies collect data. But it’s the ability to analyze and strategically act on that data that matters, notes Thomas Davenport, the author of the best-seller Competing on Analytics: The Science of Winning.. Most companies use data in a supporting role—not as the strategic weapon it can be.

At a time when competing companies offer similar products and have access to the same technologies analytical customer-facing processes are some of the only areas where businesses can differentiate themselves. “Analytical competitors” mine their data for every sliver of information it offers and then utilize that information in strategic ways. Firms like Harrah’s, Marriott  and Google that use analytical tools in a strategic manner are raising the bar in their industries when it comes to things like customer service, supply chain management and marketing.

* * * * *

Companies are taking their metrics—marketing metrics, sales metrics and service metrics—and using them, among other things, to segment, cross-sell, forecast, target and study drivers of satisfaction. Rather than looking at what happened, companies are able to predict more precisely what will happen and to better understand how and why it happened. Decisions are based on facts, not hunches or incomplete information.

Historically there’s been as much “art” in advertising and marketing as there has been “science.” Davenport argues that science is more likely to be correct than “art,” and adds that science enables a company to experiment on a small scale before committing a slew of resources to a huge marketing campaign or program.

* * * * *

Example: Harrah’s

In order to attract and retain customers, Harrah’s uses analytical tools not only to identify profitable customers, but to pinpoint its customers most likely to be wooed by competitors. Through well-designed marketing campaigns—created around information the analytical tools delivered—Harrah’s marketing methods can be strategically aimed at keeping those customers.

Analytical tools allowed the entertainment company to create a well-defined profile of its best customer, developing a beefed-up customer relationship management system anchored by a centralized data warehouse filled with pertinent information about how Harrah’s customers interact with the company. And given this information, Harrah’s marketing efforts are tailored to attract its different constituencies.

For instance, Harrah’s customers who live within driving distance of a casino receive different offers than those who do not. Frequent visitors to the casino in New Orleans are likely to receive different offers than frequent customers in Las Vegas or St. Louis. Harrah’s only targets customers likely to respond to such offers and it has more than 80 different segments for each marketing campaign.

One of the reasons Harrah’s has been so successful, notes Davenport, is because they focused on “one thing early” when it came to analytics. In Harrah’s case that “one thing” was customer loyalty. “In terms of marketing, companies need to think about target areas and about what they’re trying to accomplish,” adds Davenport. According to information available on Harrah’s website, nearly 50 percent of the company’s revenue is driven by marketing and the company’s analytical efforts have helped boost the company’s bottom line.

* * * * *

In studying companies that use analytics successfully, Davenport crafted what he calls “The Ladder of Analytical Marketing Targets”—essentially a best practice guide. First up, build a centralized customer database so that the company can get a comprehensive idea about its customers. The company can then treat “different customers differently” and respond appropriately to a customer’s activity. Companies can keep track of who got what and better manage their marketing campaigns—to the point of personalizing them. Via predictive modeling, companies can answer with much more certainty what customers are likely to do next given what they’ve already done. As a result, companies can make real time, customized offers that make sense to their customers.

Edit by DAF

* * * * *

Full article:
http://knowledge.emory.edu/article.cfm?articleid=1193#

* * * * *

Want more from the Homa Files?
Click link =>  The Homa Files Blog

* * * * *

Posted in Analytics, Mktg - Market Research, Mktg - Promotion | Leave a Comment »