World Economic Forum 2018 In A Changing World
Chris Cellettion 30 January, 2018 at 01:01
Each year, the financial and political leaders from around the globe descend on Davos, Switzerland for the World Economic Forum. This year’s Forum comes at a time of great unease—while the world economy finds itself in a relatively stable position, forces like technology, protectionism and inequality are rattling the foundation. To top it all off, the Bulletin of Atomic Scientists crashed the party in Switzerland by announcing the Doomsday Clock is now the closest to midnight it’s been since 1953.
Expectedly, tech giants were a big part of the conversation this year. Many have started to wonder how Facebook, Google, and Amazon will fare in a future in which they continue to gobble up more and more of the media and marketing share. Speaking with CNBC, WPP boss Sir Martin Sorrell wondered: “The big issue will be, do these companies have to be regulated, or not? I mean, is the power that Google and Facebook have, for example, in the digital marketplace, where they control 75% of digital advertising, digital advertising is about 30% of the world market, so they have about 20% between them, is that an issue or not?”
The tech behemoths are becoming walled gardens, and those walls continue to grow. Might they soon be true monopolies? What happens then? Ford Professor of Economics at MIT David Autor spoke on a panel titled “Can We Live With Monopolies?”, and likened the position that Amazon and Facebook find themselves in to that of AT&T and the US railroads. Autor seemed to offer his opinion on Sorrell’s question on whether or not these companies’ share is an issue, stating, that companies “which appear indomitable can fade pretty fast”, and boldly surmised that Facebook would be almost non-existent in 20 years from now. Surely that sounds a bit outlandish, but there’s no question that Facebook will probably look vastly different in 20 years, whether that’s because of regulatory action or self-imposed change due to a changing world.
Whether or not Facebook is the same 20 years from now, it’s still a major media gatekeeper now, which means brands want to be there. Its “fake news” problem is emblematic of a larger issue marketers face these days—placement. Ads being seen next to inappropriate content can put agencies in a tough spotl. “Business leaders are under more pressure than ever to justify the investments they make, the expenses they authorize on behalf of clients,” Ogilvy Worldwide Chairman and CEO John Seifert told CNBC. Rapid change brought on by massive technological change has put marketers in a precarious place. “In the area of marketing, one of the most challenging parts of our job right now is validating that the spending that our clients are doing creates results that really matter for their business.”
Part of that change is globalization, which seems to be in a bit of a precarious position in a Brexit/Trump world. Indian Prime Minister Narendra Modi lambasted the forces of protectionism that he said “are raising their heads against globalization…their intention is not only to avoid globalization but to reverse its natural flow.” President Trump arrived in Davos to double down on his “America First” agenda, but couched that by saying “American First doesn’t mean America alone.” Additionally, in a television interview he referred to himself as “a free trader, a fair trader, I’m, all kinds of trader.”
Whether the increasingly-globalized environment remains or not, technology will continue to advance unimpeded. How, and how quickly, that technology impacts employment remains to be seen, but certainly an increasing number of jobs will be susceptible to automation. Perhaps that’s why the words of Justin Trudeau made a mark, as the Canadian Prime Minister spoke candidly about the responsibility that corporations have to their people. “Too many corporations have single-mindedly put the pursuit of profit ahead of the well-being of workers,” Trudeau said. This, in turn, has contributed to the growing problem of inequality, with workers falling further and further behind. “All the while, companies avoid taxes and boast record profits with one hand while slashing benefits with the other,” Trudeau said.
That sentiment may have caused some capitalist eyes in Davos to roll, but companies do find themselves in an ever-changing social culture. A vast majority of millennials embrace brands that advocate for issues that they are about, and are much more likely than earlier generations to research these issues and make purchase decisions based on their findings. Companies that take steps to address the well-being and compensation of their employees may not only foster a positive internal culture, but endear themselves to the buying public, too.
And it’d be putting it lightly to say that corporate culture has been in the news recently. This year’s World Economic Forum came at a time when #TimesUp and #MeToo are seemingly daily part of the cultural conversation. Economic and gender inequality go hand in hand, said Winnie Byanyima, the executive director of Oxfam International at the Forum. Byanyima said the movement is just beginning, and crucially can help give voice to those in less-high profile jobs who endure abuse, like domestic workers. Byanyima thinks that tackling income inequality will have a (major!) added benefit of tackling violence against women. One key way to do so, she says, is to bring women into every level of decision making and leadership, so they can be the ones to drive change.
If the talk Davos is any indication, the only thing governments, the global financial elite, and corporations can get used to is that things will keep changing. Whether or not they change for the better is up to them.