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2010 saw a faster recovery than we thought possible. As predicted, growth returned in the second quarter, mainly due to easy comparatives, but accelerated faster than anticipated for the rest of the year and into 2011. Overall, 2011 should grow at a similar rate at around 5% like-for-like, as clients seek top-line growth in the faster-growing markets and the US continues to stabilise. 2012 should be good too, boosted by the maxi-quadrennial events of the Summer Olympics in London, the European Football Championships in Poland and Ukraine, and the US presidential election, which should see political spending of at least $4 billion. 2013, however, may a tougher year, as the newly re-elected or elected US president finally wrestles with the deficit. As we see in the differences between US and UK economic policies, governments are now faced with a dilemma, a choice between the pain of higher taxes combined with government cuts to reduce the deficit – or inflating our way out of trouble. We can make it easier in the long term by wearing the hair shirt now, slashing state spending and raising taxes, with the resulting loss of jobs. Or we can make it easier in the short term by stoking inflation, with long-term interest rates rising. But it is worth pausing to consider this paradox: we are being asked to spend and lend our way out of this recession. That, surely, is what got us into crisis in the first place.

Whatever the conclusion, WPP’s strategy remains appropriate. New geographical markets, new media and consumer insights will become more important. Furthermore, globalisation, overcapacity and the shortage of human capital, the web, internal communications, concentrating distribution, corporate responsibility, the government as a client, and a balance between global and local organisational structures, will continue to drive branding and differentiation, and advertising and marketing services.