EDITORIAL: Some grounds for optimism in 2002

Most of adland's inhabitants would like to obliterate 2001 from

their memories. Client spending slashed, agency jobs axed and bad news

which seemed to stretch well into the gloomy distance. So is there any

reason for agencies to believe that the new year will be an improvement

on the one now happily consigned to history?



Perhaps. The recovery - if it can even be called such - is barely at

green shoots stage and still highly vulnerable to a sharp frosty

spell.



Yet there's no reason to greet 2002 with the kind of foreboding that

2001 precipitated. At that time the reasons for pessimism were soundly

based.



The soaraway growth of 2000, artificially inflated by ephemeral dotcom

budgets, couldn't be sustained. And when corporate over-investment,

particularly in technology sectors, put the US economy on the slide, it

was painfully clear what the outcome would be for a global marketing

communications industry now 70 per cent under US control. Twelve months

on, there's a case for cautious optimism.



A number of big Madison Avenue agencies saw their fortunes improve in

the fourth quarter while major US retailers, including Wal-Mart, ended

2001 with better-than-expected sales figures.



Don't get carried away though. Large discounts offered to US shoppers

distort the figures and will harm profits. Nor should UK agency chiefs

now detecting less inclination by clients to postpone spending deceive

themselves that a return of the good life is imminent.



Renewed growth will be patchy at best. Some sectors are already starting

to power ahead. Asda, the supermarket chain, has seen customer

transactions grow by 11 per cent in the past few months. And it's not

alone.



However, other advertisers may have further pain to endure. Car

manufacturers will almost certainly suffer further as City bonuses fail

to be paid and unemployment rises. So will travel companies, as family

holidays are sacrificed in order to pay off credit card debts.



But let's keep 2001 in perspective. Had it not been for the distorted

growth of the previous 12 months, the year would have seemed far more

normal. Jobs have been lost yet there's good reason to suppose that,

with agencies already running as lean as possible, hiring will resume as

economic conditions improve.



So good luck and continued success to Mother, Campaign's choice as

Agency of the Year. It has proved resiliant, resourceful and highly

creative through the worst of times.



May it prove a great ambassador for the industry if and when the best of

times return.



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