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Winners in a Digital World

In less than five years, internet ad spend nearly doubled: $299 billion was spent on global internet advertising in 2019 compared to $156 billion in 2015.

Reaching $160 billion in one year, digital display advertising—a broad category including banner ads, rich media, advertorial and sponsorship, online video and social media—accounted for the largest global ad expenditure in 2019.

Comparing all digital display ad spend in isolation with TV and newspaper, we can see the continued significance of the shift to digital, and how it’s projected to continue.

Looking at the main visualization, it’s clear that budgets have shifted, with digital channels now accounting for more than half of total advertising spend.

Although digital spending is up across the board, search engine ad spend began to plateau in the late 2010s, while social and ecommerce mediums both continue to rise. Impressively, between 2012 to 2020, the percentage of U.S. senior marketing budgets allocated to social media more than doubled, ballooning from almost 9% to nearly 21%.

– Malorie Lucich, Head of Product & Tech Communications, Pinterest

Advertisers aren’t the only ones spending money online. More than $183 billion is expected to be spent online by consumers as a result of the 2020 pandemic.

The Formula for a Happy Relationship

When it comes to giving consumers what they want, Apple ticks the box for three important need states highlighted in the report:

• Fulfilment: A brand that exceeds expectations by delivering on superior service, quality, and efficacy.
• Ritual: When a person ingrains a brand into his or her daily actions, it becomes a vitally important part of their everyday life.
• Enhancement: Customers become better through use of the brand—smarter, more capable, and more connected.

Interestingly, brands that are part of the smartphone ecosystem generally outperform brands that are not, and the ecosystem has only increased in strength during the pandemic. Moreover, brands that fall into the “devices” or “content/information” categories have higher intimacy scores, and are therefore more loved.

There has also been an increase in the performance of brands in the “access” category—such as Verizon and AT&T—which may be attributed to the value people are placing on communication during the pandemic.

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WTO Trade Barometers

The WTO has developed a set of indicators to provide “real-time” information on trends in world trade: the Goods Trade Barometer and the Services Trade Barometer. Both barometers highlight turning points in world trade and are intended to complement conventional trade statistics and forecasts.

Full details

Global business/ civil society response to COVID-19

• International Air Transport Association: Guidance for Vaccine and Pharmaceutical Logistics & Distribution
• Global Express Association: COVID-19 vaccine distribution — Getting ready
• Global Express Association: COVID-19 pandemic — Global logistics & express delivery (lessons learned and recommendations)
• Progressive International: “Waiver from certain provisions of the TRIPS Agreement for the prevention, containment and treatment of COVID-19”
• Civil society letter: Supporting proposal by India and South Africa on waiver from certain provisions of the TRIPS Agreement for the prevention, containment and treatment of COVID-19

Maintaining open trade

It will be up to us to turn this crisis into a historic opportunity that will allow us to definitively transform the economies of our subregion, harmonize and converge our economic and financial systems, and create a regional business fabric capable of competing in the international arena

Leoncio Amada NZE, President for the CEMAC region at the African Energy Chamber1 June 2020

Specialization and production on a large scale generate significant economic benefits. This is what enables consumers to access sophisticated goods at a low cost. If, however, we backtrack, and build value chains that are less fragmented and more resistant to shocks, then production costs will rise and consumers will foot the bill

Isabelle Mйjean, professor at the Йcole polytechnique franзaise26 May 2020

In a world that is interdependent, a strong system of multilaterally agreed rules lies at the foundation of a stable and predictable system. And in a world during and after COVID-19 where economic challenges seem inevitable, such rules will have an even more crucial role to play

RV Anuradha, specialist in international economic law and policy19 May 2020

Trade Facilitation and COVID-19: Report on Survey Results

This report compiles the findings of the joint COVID-19 survey carried out by TFAF, ICC and the Alliance.

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The Biggest 2020 Deals Were Saved for Last

After a quiet March, only a few large deals occurred from April to the summer.

Nvidia’s $6.9 billion purchase of network chip producer Mellanox Technologies in May was more than a year in the making, and Uber’s $2.65 billion acquisition of food delivery rival Postmates in July significantly consolidated the U.S. food delivery scene.

As it turned out, the biggest deals of 2020 were back-loaded for the end of the year. Just under half of 2020’s billion-dollar tech M&As happened from September‒December, including the year’s three largest tech acquisitions:

Date	Purchaser	Acquired Company	Amount (Billions)
2020-09-13	Nvidia	Arm	$40.0
2020-10-27	AMD	Xilinx	$35.0
2020-12-01	Salesforce	Slack	$27.7
2020-02-21	Morgan Stanley	ETrade	$13.0
2020-02-04	Koch Industries	Infor	$11.0
2020-10-29	Marvell Techonology	Inphi	$10.0
2020-02-28	Intuit	Credit Karma	$7.1
2020-05-04	Nvidia	Mellanox	$6.9
2020-01-13	Visa	Plaid	$5.3
2020-01-09	Insight Partners	Veeeam	$5.0
2020-12-14	Vista Equity Partners	Pluralsight	$3.5
2020-10-12	Twilio	Segment	$3.2
2020-07-06	Uber	Postmates	$2.7
2020-11-10	Adobe	Workfront	$1.5
2020-02-25	Salesforce	Vlocity	$1.3
2020-04-07	SoFI	Galileo	$1.2
2020-06-26	Amazon	Zoox	$1.2
2020-05-04	Intel	Moovit	$1.0

Of the 19 deals over $1 billion tracked above, Salesforce and Nvidia were the only companies to make multiple major acquisitions. And although tech saw gains across the sector, most of the major M&A activity was centered around semiconductors.

As 2020 winds down, the market focus on tech is expected to last into 2021. However, the markets and the world at large continue to deal with COVID-19.

The rollout of vaccines has put the world on a timeline to reach a post-COVID era. How will the tech landscape be affected?

The Digital Future is Now

As a result of the pandemic, it is projected that global advertising spending could fall by 8.1% this year. However, 53% of all global ad spend is expected to flow online. And the rise of search, social media, video, ecommerce—in contrast to TV and print—becomes clearer.

Although search ad spend recently plateaued, its rise over the last decade has been dramatic. With digital content consumption doubling since the pandemic began, the growth of social, e-commerce, and search ad spend are likely to continue.

If these trajectories are any indication, advertising budgets will only be getting more digital.

Notable Mentions

It’s also worth noting that consumers have increased their usage of virtual conferencing brand Zoom more than any other brand in the study.

While hand sanitizer brand Purell did not make the list of most loved brands, it ranked in first place when it comes to the best response to the pandemic and is the brand consumers are most willing to pay 20% more for.

Overall, it is clear that COVID-19 has had a huge influence on the brands that consumers connect with most. With their preferences now leaning towards brands in the smartphone ecosystem, one has to wonder: will marketers of the future place more value on winning the hearts of consumers, or simply getting in their hands?

The Central Bank Toolkit

To begin, here are brief descriptions of each policy, which the IMF sorts into four categories:

1. Monetary Policies

Policies designed to control the money supply and promote stable economic growth.

Policy Name	Intended Effect
Policy rate cuts	Stimulates economic activity by decreasing the cost of borrowing
Central bank liquidity support	Provides distressed markets with additional liquidity, often in the form of loans
Central bank swap lines	Agreements between the U.S. Fed and foreign central banks to enhance the provision of U.S. dollar liquidity
Central bank asset purchase schemes	Uses newly-created currency to buy large quantities of financial assets, such as government bonds. This increases the money supply and decreases longer-term rates

2. External Policies

Policies designed to mitigate the effects of external economic shocks.

Policy Name	Intended Effect
Foreign currency intervention	Stabilizes the national currency by intervening in the foreign exchange market
Capital flow measures	Restrictions, such as tariffs and volume limits, on the flow of foreign capital in and out of a country

3. Financial Policies for Banks

Policies designed to support the banking system in times of distress.

Policy Name	Intended Effect
Easing of the countercyclical capital buffer	A reduction in the amount of liquid assets required to protect banks against cyclical risks
Easing of systemic risk or domestic capital buffer	A reduction in the amount of liquid assets required to protect banks against unforeseen risks
Use of capital buffers	Allows banks to use their capital buffers to enhance relief measures
Use of liquidity buffers	Allows banks to use their liquidity buffers to meet unexpected cash flow needs
Adjustments to loan loss provision requirements	The level of provisions required to protect banks against borrower defaults are eased

4. Financial Policies for Borrowers

Policies designed to improve access to capital as well as provide relief for borrowers.

Policy Name	Intended Effect
State loans or credit guarantees	Ensures businesses of all sizes have adequate access to capital
Restructuring of loan terms or moratorium on payments	Provides borrowers with financial assistance by altering terms or deferring payments

COVID-19: Support measures

The table below lists the support measures taken by WTO members and observers in response to the COVID-19 pandemic. These measures have been submitted by delegations directly to the WTO Trade Monitoring Section in response to the requests by the Director-General in March 2020 and by Deputy Director-General Agah in September 2020. The list only includes measures communicated by members and observers and features measures only in the original language of the submission. The list is an informal situation report and an attempt to provide transparency with respect to support measures taken in the context of the COVID-19 crisis.

Putting Policies Into Practice

Let’s take a closer look at how these policy tools are being applied in the real world, particularly in the context of how central banks are battling the effects of the COVID-19 pandemic.

1. Monetary Policies

So far, many central banks have enacted expansionary monetary policies to boost slowing economies throughout the pandemic.

One widely used tool has been policy rate cuts, or cuts to interest rates. The theory behind rate cuts is relatively straightforward—a central bank places downward pressure on short-term interest rates, decreasing the overall cost of borrowing. This ideally stimulates business investment and consumer spending.

If short-term rates are already near zero, reducing them further may have little to no effect. For this reason, central banks have leaned on asset purchase schemes (quantitative easing) to place downward pressure on longer-term rates. This policy has been a cornerstone of the U.S. Federal Reserve’s (Fed) COVID-19 response, in which newly-created currency is used to buy hundreds of billions of dollars of assets such as government bonds.

When the media says the Fed is “printing money”, this is what they’re actually referring to.

2. External Policies

External policies were less relied upon by the systemically important central banks covered in today’s graphic.

That’s because foreign currency interventions, central bank operations designed to influence exchange rates, are typically used by developing economies only. This is likely due to the higher exchange rate volatility experienced by these types of economies.

For example, as investors flee emerging markets, Brazil has seen its exchange rate (BRL/USD) tumble 30% this year.

In an attempt to prevent further depreciation, the Central Bank of Brazil has used its foreign currency reserves to increase the supply of USD in the open market. These measures include purchases of $8.8B in USD-denominated Brazilian government bonds.

3. Financial Policies for Banks

Central banks are often tasked with regulating the commercial banking industry, meaning they have the authority to ease restrictions during economic crises.

One option is to ease the countercyclical capital buffer. During periods of economic growth (and increased lending), banks must accumulate reserves as a safety net for when the economy eventually contracts. Easing this restriction can allow them to increase their lending capacity.

—Andrea Enria, Chair of the ECB Supervisory Board

The European Central Bank (ECB) is a large proponent of these policies. In March, it also allowed its supervised banks to make use of their liquidity buffers—liquid assets held by a bank to protect against unexpected cash flow needs.

4. Financial Policies for Borrowers

Borrowers have also received significant support. In the U.S., government-sponsored mortgage companies Fannie Mae and Freddie Mac have announced several COVID-19 relief measures:

• Deferred payments for 12 months
• Late fees waived
• Suspended foreclosures and evictions for 60 days

The U.S. Fed has also created a number of facilities to support the flow of credit, including:

• Primary Market Corporate Credit Facility: Purchasing bonds directly from highly-rated corporations to help them sustain their operations.
• Main Street Lending: Purchasing new or expanded loans from small and mid-sized businesses. Businesses with up to 15,000 employees or up to $5B in annual revenue are eligible.
• Municipal Liquidity Facility: Purchasing short-term debt directly from state and municipal governments. Counties with at least 500,000 residents and cities with at least 250,000 residents are eligible.

More Time to Kill

Global Web Index found that over 80% of consumers in the U.S. and UK say they consume more content since the outbreak, with broadcast TV and online videos (YouTube, TikTok) being the primary mediums across all generations and genders.

Unsurprisingly, 68% of consumers are seeking out pandemic updates online over any other activity. Gen Zers however, have other plans, as they are the only generation more likely to be listening to music than searching for news.

Overall, younger generations are more likely to entertain themselves by playing games on their mobile or computer. Millennials also stand out as the foodie generation, as they are the most likely to be searching for cooking recipes or reading up on healthy eating.

Over the Years: China’s Steady Climb

While China still ranks below the U.S. in total brand value, its percentage decrease from last year was far lower than the other nations on the list. China stayed relatively stable with a modest 4% drop, about 10 percentage points less than the global average.

China’s stability this year is nothing new. In fact, the country has been steadily closing the brand value gap between itself and the U.S. since 2015:

This year marks the smallest gap yet, with just a $4.9 trillion brand value difference between the U.S. and China. This is significantly lower than in previous years—for instance, in 2015 the U.S. had a $13.1 trillion lead over China.

Will America make a comeback in 2021 under a new administration, or will the gap between it and China close even further?

WTO reports on COVID-19 and world trade

• Trade in Medical Goods in the Context of Tackling COVID-19
  • Annexes (in Excel)
  • Download data (including data based on WCO-WHO revised classification)
  • Data visualization app
• Transparency — why it matters at times of crisis
• Export prohibitions and restrictions
• The treatment of medical products in regional trade agreements
• E-commerce, trade and the COVID-19 pandemic
• Standards, regulations and COVID-19 — what actions taken by WTO members? (updated on 4 Dec. 2020)
• Trade in services in the context of COVID-19
• Helping MSMEs navigate the COVID-19 crisis (updated on 24 Sept. 2020)
• The COVID-19 pandemic and trade-related developments in LDCs
• The economic impact of COVID-19 on women in vulnerable sectors and economies
• Trade costs in the time of global pandemic
• Cross-border mobility, COVID-19 and global trade
• COVID-19 and agriculture: A story of resilience
• How WTO members have used trade measures to expedite access to COVID-19 critical medical goods and services
• The TRIPS Agreement and COVID-19
• Future resilience to diseases of animal origin: the role of trade
• Infographic: Developing & delivering COVID-19 vaccines around the world
• Developing & delivering COVID-19 vaccines around the world: A checklist of issues with trade impact
• Trade in Medical Goods in the Context of Tackling COVID-19
  (updated on 22 Dec. 2020)
• Developing and delivering COVID-19 vaccines around the world: An information note about issues with trade impact

The Media Landscape Shapes the Ad World

In advertising, dollars go where the eyeballs are.

Recently, all eyes have been on the digital realm—a trend that coincided with the disastrous fall of the print industry. As people mass-migrated to digital platforms in the 2010s, marketers were hot on their heels, and the fall of print media began.

In 2014, TV ad spend met a similar fate, peaking at nearly $250 billion. However, despite its rather sharp decline, TV still remains the largest in terms of global advertising spending.

The demise of the newspaper is shown dramatically in the above graphic, beginning in 2007 before the financial crisis, and correlating with the ascent of search engine ad spend. Peaking at $125 billion before the social media boom, newspaper advertising has never recovered.

Special Issue Information

Dear Colleagues:

Since its discovery in Wuhan in December 2019, the 2019 novel coronavirus (COVID-19) has rapidly spread to all provinces, municipalities, and autonomous regions in China and has been introduced to more than twenty countries in Asia Pacific, Europe, and North America. This novel virus has presented a challenge to epidemic disease prevention in many countries and regions and has had a great impact on economic, financial, and social development.Taking China as an example, as of 12 February 2020, 42,744 people had been infected, 1017 people had died, and 21,675 people had suspected cases of the disease. At present, most provinces and cities in China have adopted closed management methods to avoid further spread of the virus and to reduce the probability of new patients being infected. However, in the past three months, because of the stagnation of most production activities in China, the vast majority of ordinary people have been isolated at home, which has caused many social and risk management problems and has also had an inestimable impact on China’s economic and financial development.The research topics of this Special Issue include: big data analysis; big data prediction; data mining; risk modelling; risk simulation; risk calculation; risk forecasting; risk assessment; risk management; epidemic prevention and control; outbreak emergency management; and the impact of the epidemic on the economy, finance, people’s psychology, education and universities, social development, companies, and people’s lives.We think that research in this topic is very important, and we warmly encourage researchers, teachers, students, engineers, academics, and industry professionals from all over the world to present their current insights in our special issue.Prof. Dr. Xiao-Guang YueDr. David Xuefeng ShaoDr. Wei LiuGuest Editors

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All papers will be peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 100 words) can be sent to the Editorial Office for announcement on this website.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-blind peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. Journal of Risk and Financial Management is an international peer-reviewed open access monthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript.
The Article Processing Charge (APC) for publication in this open access journal is 1000 CHF (Swiss Francs).
Submitted papers should be well formatted and use good English. Authors may use MDPI’s
English editing service prior to publication or during author revisions.

The Power of Love

While attracting eyeballs or increasing foot traffic may carry a lot of weight when it comes to determining the success of certain brands, the real metric that should be paid attention to is love.

Brands that nurture emotional bonds with their customers tend to outperform top companies listed on the S&P 500 and Fortune 500 in both revenue and profit. Not only that, they can also build higher levels of trust, which in turn breeds a more loyal consumer base over time.

—MBLM Managing Partner, Mario Natarelli

As the global pandemic rages on, this idea has become more relevant than ever before. Consumers have been using their newfound time to deepen their relationship with brands, but who has managed to win their hearts?

Brand Love in the Time of COVID-19

Apple has been named as the most loved brand during COVID-19, moving up from third place before the pandemic. Even though the tech giant beat Disney and Amazon for the top spot, its success can mostly be attributed to female and millennial consumers, while Amazon was voted the most loved brand for male consumers.

The list of most loved brands has seen three new additions throughout the year: Google, YouTube, and Toyota, which means that media and entertainment brands now dominate the list. The retail industry has also increased intimacy score performance by 9.4% during the pandemic, with Walmart flying the flag for retail brands in fourth place.

Leaning on a Pillar of Trust

Across the board, consumers view the World Health Organization (WHO) as the most trusted source of information for any COVID-19 related updates.

This isn’t true everywhere on a regional basis, however. For example, while U.S. consumers trust WHO the most, UK consumers view their government as their most trusted news source overall.

Trust in information shared on social media is higher than word of mouth from friends and family, and even foreign government websites. That said, it is lower than information shared on the radio or news websites.

The Need for Pandemic Positivity

While staying abreast of pandemic updates is important, ultimately, a positive mindset and the ability to switch off will help people cope better day-to-day.

Therefore, it seems reasonable that people are more inclined to invest in new subscription services since they have been in isolation, with almost one-third of Gen Zers considering purchasing Netflix, followed by Disney+.

Understandably, people are becoming increasingly worried about how much time they are dedicating to their screens. However, research suggests that screen time itself is no cause for concern. Rather, it’s the content we choose to consume that could have a significant impact our psychological well-being.

Perhaps most intriguingly, the TV shows and movies that are increasing in popularity on Netflix are about pandemics—which could signify the need for people to fictionalize the chaos we find ourselves in.

Regardless of what type of content we are consuming, the fact is that every generation is relying on their devices during this pandemic to inform and distract more than ever before, creating a huge opportunity for media companies to engage a captive audience.

Deal Activity from the Get-Go

Though 2020 was all about COVID-19 and its impact on the market, the tech sector had major deal flow even before the pandemic began.

By the end of February, six of the 19 biggest tech mergers and acquisitions of the year had already occurred—and the month of February alone saw the most major deals of any month with four.

The first deals of the year were also some of the biggest. Morgan Stanley’s purchase of online brokerage E*TRADE for $13 billion and Koch Industries’ $11 billion completed takeover of software company Infor were the 4th and 5th biggest tech acquisitions of 2020.

Other big moves included purchases from tech and payments firms Salesforce, Visa, and Intuit, as well as private equity firm Insight Partners.

How is Nation Brand Value Quantified?

While the report provides a full explanation of its methodology, here’s a quick summary of how the scoring system works.

First, Brand Finance calculates a country’s Brand Strength Index (BSI) score using three pillars:

1. Goods & Services
   Openness to tourism, market size, and trade rules
2. Society
   Quality of life, corruption, and cultural image
3. Investment
   Talent retention, use of technology, R&D, taxation, and regulation

From there, the BSI score is used to calculate a hypothetical royalty rate, and applied to a country’s GDP. Then, a discount rate is factored in to account for economic risk. Finally, numbers are crunched to provide the “Brand Value” of a country.

Special Issue Editors

Adjunct Prof. Xiao-Guang Yue
Website

SciProfiles

Guest Editor

Department of Computer Science and Engineering, School of Sciences, European University Cyprus (EUC), Nicosia 1516, CyprusInterests: Data Mining; Machine Learning; Sustainability
Special Issue in
Sustainability: Sustainable Development in the High-Density Built Environment: An Evidence-Based Practice Approach

Dr. David Xuefeng Shao
Website
Guest Editor

Discipline of International Business, University of Sydney, Sydney, NSW, 2006, AustraliaInterests: international risk management; management capabilities

Prof. Dr. Wei Liu
Website
Guest Editor

Business School, Qingdao University, Qingdao 266100, ChinaInterests: corporate strategy; sustainable environmental management
Special Issue in
Journal of Risk and Financial Management: The Belt and Road — Risks and Financial Management Issues Faced by Enterprises’ Internationalization