HowOur economic system has been perverted

January 30, 2012 12:00 AM

How do you see the crisis

Davos, a banker said: "We know we don't know." This summed up things. We know that we do not know what looks like the crisis because we have never known anything like. When you see hundreds, say I, thousands of billions of dollars lost, the administration Obama that mobilizes 2,000 billion for banks, the credit system which is still not working, etc., is anguish of the man in the street. And we understand his anger when he is denied an increase in salary or a complement to social... Everyone is lost. It is an economic crisis for a very particular type as accompanied by doubts about the society that we have built systems of remuneration on the meaning of capitalism, the distribution of wealth. The crisis broadcasts everywhere. It undermines our system of values.

How

Our economic system has been perverted. Safeguards no longer work. We live in a pace of short term imposed by the US SEC, where economic operators are obliged to provide a continuous information flow, and in particular the publication of the quarterly results. This pressure made us lose sight of the long term. It does not allow companies to work serenely on plans to three or five years. Listed companies are subject to the bad mood of institutional funds, they are exposed to predators. Unless having a Board of Directors and a shareholding extremely solid, it became very difficult to manage the long term business. This problem previously occurred in the crisis, but not became that more crucial.

What should he start to reform capitalism

At the Davos Forum, I found that there was a consensus on three points. One: the action of the States in the crisis has been praised, but everyone is well aware that the State can not handle. It was quite tasty that the warning on this point is coming from Chinese and Russian premiers... Two: need to revise the mode of operation of the regulatory authorities. I would remind you that the "sub-prime" have benefited from notes AAA! Three: solutions are global. I do not think a dry who would oversee the whole world, of course, but more consistency is needed at the international level.

This is also, obviously, for the accounting rules. They have been defined by the ayatollah in accounting, they have to produce absurd consequences. What it used to assign a value to the case to an asset if the company, in any event, has no intention to sell for This violates no reason fundamental elements of the balance sheets. Moreover, our economy is largely based on intangible today. Should rethink the accounting model in the result because the reviews do not reflect this new reality. Where are the values of the brands patents

Do you fear protectionism

We face a crisis of unprecedented magnitude. States must intervene. By definition, they can do with the money of the taxpayers. At the same time, they can accept, it is normal, that their interventions benefit to countries where the tax is void.

Interventions of States must be temporary. They must save the economic tissue which may disappear suddenly. But the State cannot manage businesses in their place. Or does mean it nationalized the economy... It is important that, soon, the economy recovers and that growth is to return to benefit all countries and to avoid endangering globalization or locking behind protectionist barriers.

Are you concerned for your clients

Some are familiar with novel situations and face it with courage and discipline. But this crisis is not like the others: added to the decline in net sales is a liquidity crisis which led customers to decide their investment not on their balance sheet or their account but the cash available. Even when anxiety about liquidity within the fantasy, it must be recognized that moved an obsession which has become a concern: those who have the cash to keep it, worried about what could be the behaviour of financial. In doing so, they contribute to thrombosis of financial flows. We are dealing with two spirals which join and effects add up: a spiral of the "credit crunch" based on facts and that any irrational psychological fear.

How can you go when everything goes wrong for your clients

Most of our customers go well. L ' Oréal, Nestlé, Orange, Sanofi, Procter & Gamble, Kellogg's... the list would be too long. There are lots of bad news and little good, although our customers address this crisis in good conditions and overall very responsibly. It's always tend to remember that what is going wrong and ignore the trains arriving on time. This is not new.

But how is doing Publicis

Account

in light of the circumstances, though, because we have been able to make the right choices at the right time. We were among the first to invest heavily in emerging countries and digital technologies. Last year, we have thus made 23 of our turnover in emerging countries and 19 in digital. And in 2010, these two segments will in total represent half of our activity. In emerging countries, we are more investment but rather business case phase. In these countries, the pace of growth will of course to slow, but growth will be even stronger than in mature countries. In digital, we have the choice from 2006 to repurchase Digitas for $ 1.3 billion. And today, we thus have a position of leader on the only growth segment. What the market does not provide natural growth, we can go pick it up by ourselves. On the last quarter of 2008, the market has posted a decrease of 7. The world number one, Omnicom, saw its turnover fall by 7. We, we have an organic growth of 1.1. It is not very glorious, 1.1, but this makes a big difference. We made the right choices.

Do you fear that the end of the year 2009 is even more difficult than the beginning for advertisers

No, it is more the first half of the year as the second that I fear. It will take some time before stimulus plans being implemented by States are beginning to bear fruit. And as long as signs of a recovery, even slight, will not be there, I think that advertisers manage their cash and invest in a very cautious way. I expect a first more wrong than the second half.

You started the year winning the Carrefour budget. How did you do

We know Carrefour for a long time and we worked for them in five or six countries. We have proven that we knew manage this mark. Since a number of years, Crossroads does not meet the success it deserves. This is not only a problem of advertising. Over the past two years, I have therefore approached them to share our ideas. He comes to y have a change of management and the new team wanted a new approach to communication at the global level. We responded to their expectation with a specially adapted structure in place for them. In each country, they will have the best of the best of our group. There are generally many conflicts of interest between the agencies of a group, but we have overcome this problem because our Organization is fluid and collegial. Individual interests fade to the interest of the group.

Is this not all even the relational who played

I know of Lars Olofsson, the new Director General of Carrefour, for a long time. I knew him when he was in Nestlé France, and the mother house in Vevey, but I do not think that he has taken this decision alone, and I do not think that such a decision would have been made if the teams were fully satisfied with their previous Agency. He came home because he knows that we respect our promises. We were at the height for Nestlé, we'll be at the hub height. And not forget that the slogan "with crossroads, I positive", it is us. We have found him here, in a small group, in the 1980s. We have supported the idea in enfiling before the Group staff t-shirts hit this slogan that eventually give rise to the verb "positive". Change an image by acts. Not only through language. Advertising is an accelerator, but which must be based on evidence.

The consequences of the crisis for your business

It will have three impacts. First on the language. We live in a crisis of values. Responsibility for communication and advertising is heavier, the way of saying things should be taken into account, the cynical tone will be prohibited. It can be funny and dreamy, but will require above all that the speech of a brand is reflected in the daily behaviour of a company and its leaders. Then, we need to work more on digital. This may disrupt organizations, attitudes, populations. Finally, we must change our operating model. We move from the status of service provider of advertising and marketing partner in the creation of value. Our billing mode will need to adapt to reflect this change. We need better value that we bring unique and so pay fair prices for big ideas.

Your rival Martin Sorrell, WPP, believes that Publicis is loss of speed. That her answer you

We are competitors the more formidable know WPP. We earn more budgets, while twice bigger than us. They love to tease the French and seek to prepare us against Havas, but our best response is to the clients in the commercial field.