I was a marketing student when the Berlin Wall came down. It was arguably one of the most exciting and important events of the 20th century but I can hardly remember anything about it. I do remember failing my first ever university exam that week of 9 November 1989 and also that Stoke City sacked Mick Mills as their manager because the guy who lived next to me on campus was a huge Stoke fan and woke me at the unearthly hour of 10.30am (I was an undergraduate after all) with the momentous news that Alan Ball was taking over.
The point I am trying to make is that when momentous things occur, we rarely realise it at the time. Most people are so caught up in the mundane challenges of daily life that they rarely appreciate the magnitude of the big changes in society when they actually occur.
And I believe that is exactly what happened this week. We were concerned with street riots in the UK and a tumbling FTSE as well as the everyday issues that surround marketing like discounting and the rise and fall of various high street brands. And it’s completely possible that, as a result, most marketers failed to realise that the world completely changed this week.
For as long as any of us can remember, the US was supreme. It was the cultural, economic and military centre of the universe. And we, as marketers, were a function of it. I was trained on marketing textbooks written by US professors, who used mostly American examples to show me how to do marketing and branding. It was Ted Levitt and Phil Kotler and the Harvard Business School that stretched my mind and gradually solidified my understanding of the great discipline of marketing.
When I decided to study for my PhD in marketing, it was inconceivable that I would not do part of it in the US where marketing had been invented. That was where all the best run brands and the most impressive professors were located. It simply went without saying, America was where marketers took their co-ordinates and their inspiration.
This week we saw the start of the decline of the great American empire
But that has changed. This week we saw the start of the decline of the great American empire. Like all great empires before it – the British, the Romans, the Greeks – its time has come and gone.
Don’t mistake the brutality of this observation for any sense of triumphalism on my part. I enjoyed the American empire, but its time as the central force for economic and strategic thinking now ends.
We now enter the Chinese century. And there is no going back. There are many plans being proposed around the US this week but none even hint at a return to the kind of prosperity or hegemony that the country once enjoyed. It is the start of a long winter in America and the beginning of spring in the east.
If you needed evidence of China’s newly established global dominance it was clear in the statements sent from the official Xinhua news agency over the weekend to Washington after the US was downgraded by Standard & Poor’s.
According to Xinhua, America must now live by the “commonsense principle that one should live within one’s means”.
Xinhua also suggested it was time to ditch the US dollar as a global reserve currency and create a more stable international basket of currencies. America’s biggest remaining global advantage – the fact that everyone ultimately trades in its currency – is now also under threat.
It might appear a little small minded to even consider the implications for marketers and marketing in all this. There will be enormous cultural and economic implications over the next two decades as the US gradually fades and China rises to take its place at the head of the global economy.
But for marketers, there are major implications to consider. First and foremost, we must adjust our gaze from one which takes in the UK, Europe and then the US in that order and amend it to include the opportunities and threats that now appear from the east.
The sheer scale and size of the Chinese market are impossible for the majority of people in the west to take in at this stage. Never has so huge a market grown so fast, from so small a base, so quickly. For the brands like Burberry, which are well positioned to market to China, the opportunities are enormous and the implications even bigger.
But we would be guilty of over-simplification if we just point to China’s consumption potential. It is the new wave of Chinese brands that will really spell the start of the Chinese century. As yet, they number a handful of automotive companies and banks that dominate their domestic market with minimal or no impact internationally. But they are certainly on their way.
We now live in the Chinese century and everything we learned and everything we did up until this point will need to be reviewed in light of the fact.