This year's World Economic Forum saw over 2,500 dignitaries from all around the world descend on Davos. More world leaders than ever before attended, which resulted in similarly record levels of security.
I am fortunate to have been a participant at three Forums now and the sheer thrill one gets from bumping into, meeting and hearing inspirational leaders from around the world never diminishes. Personal highlights for this year include: discussing cocktails with Michael Dell, sharing an elevator with JP Morgan boss Jamie Dimon, bumping into Bono in a coffee queue and being brushed aside by the security detail of the President of Nigeria.
In past years, a single clear and resounding theme has emerged from Davos. This year, there was a very eclectic mix of seminars and numerous topics were discussed, which probably indicates that the world is gradually returning to normality as the economic cliffs begin to recede. Leaders are now talking about growth, increasing prosperity and the creation of jobs, rather than pure survival.
Many markets are definitely in a stronger position than a year ago. The U.S., U.K., Germany and many of the emerging markets are all significantly more upbeat. Even the likes of Spain, Greece and Ireland believe the worst is over.
However, the recovery is far from complete and many challenges remain. Europe, as an economic bloc, will only contribute half the level of growth of China in 2014. And no political leader seems willing to tackle the ongoing competitiveness issues caused by high social costs in Europe. Over 50% of global social costs are incurred in Western Europe against a population base of less than 8%.
Unemployment -- particularly long term unemployment -- remains stubbornly high and for most countries remains at record levels. The disparity in wealth continues to widen -- it's clear that the rich have actually fared very well as a proportion of the population over the past four years.
What was discussed at Davos has enormous implications for marketing and advertising -- for our businesses and the role we can play as an industry. The socio-economic changes around the world create some specific challenges and opportunities for those working in the marketing communication sector.
Some marketing-related highlights from Davos:
The Real World Still Matters
Many brands have made and are making their digital transformation. However, there is good evidence from other industries that the concept that the digital will replace the physical world within a short timeframe is highly improbable. This was the theme of the session: "Leading a Digical Transformation: Combining Digital and Physical to Reshape Your Business." Led by Orit Gadiesh, the chairman of Bain & Co, speakers explained that it is more likely that hybrid models will develop, with the digital and physical worlds co-existing. You can see this with Amazon and other online retailers moving into retail spaces and pop-up outlets. This was one of the key trends from ZenithOptimedia's 2038 futures project, which also flagged the potential growth of 3D printing -- another key talking point at Davos.
Big Data, Big Concerns
As people become increasingly connected, measured and tracked, the role of marketing to better understand and serve customers arguably creates the biggest change in advertising since the creation of commercial TV. Several key players in technology and communication were focused on the data challenge at Davos. Data is at the heart of many issues facing leaders in business, politics and education. Organizations including Yahoo, Reuters, Google, HP and Microsoft made it clear that they consider data as the next frontier for productivity and competition. However, companies such as Accenture highlighted the shortage of skilled data analysts. This skills gap is analogous with the shortage of experienced digital practitioners in the marketing industry. The competition for talent in digital and data will determine who will be the successful leaders of change.
An End to the Big Squeeze?
One impact of the economic crisis has been the lack of consistent investment. This, combined with low inflation, was a major concern for both speakers and delegates at Davos. Companies have been unable to raise prices, so profits have been delivered by squeezing supply chains. The advertising industry has felt the full brunt of finance and procurement vigorously squeezing costs. With the sentiment shifting towards growth and expansion, agencies can, once again, be bolder in how they provide sustainable top line growth for clients. This change in behaviour will not happen overnight, but it should mean that more marketers will seek agencies to be their partners in accelerating growth.
Growth Beyond BRIC
The growth of emerging markets is creating huge opportunities for marketers. I suspect many in marketing and advertising have focused predominantly -- and for good reason -- on the BRIC markets. However, these high-growth markets are being joined by countries such as Mexico, Indonesia, Turkey -- all of which present marketers with a rapidly growing middle class and stable governments. This was much in evidence in Davos this year. And notable by their increased presence at Davos this year were the African counties. Ten years ago, The Economist categorised Africa as "hopeless." Today that sentiment has shifted, with The Economist now classifying Africa as moving from "rising" to "aspiring."
Running a global brand, such as ZenithOptimedia brings continuous challenges and pressures. However, being able to participate in the Publicis Groupe delegation in Davos is a privilege and a wonderful opportunity to join together with other business leaders, politicians, educators and lobbyists to help improve our world. Virtually everyone I met at Davos this year was engaged, interested and keen to be a driver of positive change. On leaving Davos, I couldn't but help think that that humanity is in relatively good hands.