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The industry in which Public Creative works is driven by innovation. Our clients need us to constantly innovate and push the boundaries of what's possible with online communications in order to achieve cut-through in an increasingly noisy and fragmented media landscape. A client such as Innocent Kids is no longer competing against Tropicana or own-brand smoothies — it is competing against Cartoon Network and Disney for the attention of its audience. Where once companies used media owners to reach their audience, increasingly they are now competing with them for that same audience.
 
This is what makes digital advertising and design so exciting and inspiring. The pace at which social media is changing the way that our clients' customers are living their lives presents us with both constant challenges and constant opportunities. Twitter, Facebook and YouTube all offer ever-evolving ways for people to share experiences, whether brand-related or not, and the advent of location-based services such as Foursquare presents real opportunities for brands to connect with their audience in a meaningful way. So when I read about speculation that we are heading for a second dotcom bubble burst, despite the fact that these services are clearly working and useful, it's worrying.
 
The speculation on the potential future revenues of start-ups is a major concern. It's clearly what causes these bubbles. Once you invest £100m in a start-up, the pressure for it to turn a profit will eventually come to bear. Unfortunately for the digital economy, it's predominantly based on innovation with little research or evidence, so large-scale speculation is inevitably going to result in large-scale losses more than it will in profits. The market can't tolerate these losses so it panics and that's when the bubble bursts.
 
I was in the digital sector for the first bubble burst and, looking back, companies such as Boo.com weren't flawed in terms of concept; selling clothing online has turned out to be a huge success — even designer clothing and designer clothing to men (look at net-a-porter and MRPORTER). Boo.com just didn't have time to develop because it was asked to grow too quickly.
 
It's the blind greed of the investment sector that is forcing the bubble, not digital innovation. Google is great, and Facebook is a brilliant, well-run company that is protecting itself well by not losing control to outside investment. It's the thirst of investors hoping they'll uncover another Facebook that is driving these sorts of crazy valuations and exorbitant sums being invested. It seems inevitable that lots of good ideas out there are going to be pushed toward failure by over-investment.
 
The investment cycle is too short and too fat. Companies such as Facebook grow because the idea is brilliant and people genuinely want it. Their valuation makes sense. It's the search for the next one (and thinking that money can make it happen) that is going to cause the problems. There are great ideas out there, many of which are being hatched within a mile of the Public Creative offices at Silicon Roundabout, but bizarrely the investment in the sector is its own worst enemy.
 
Let's hope this time that some of our great British ideas have a chance to realise their potential.
 
Rhydian Fisher is managing director of digital consultancy Public Creative, which specialises in internet communication and strategy
publicreative.com

 

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