Political risks on the rise because of low oil price

18 March 2015 Consultancy.uk

The massive decrease in the price of oil is causing more and more pressure to be heaped on businesses in developing countries. Oil producing countries may face financial problems, which increases the risk of political meddling in the economy and problems with payments.

The business climate in developing countries is under more and more pressure, partly due to the plummeted oil price. Countries that are largely dependent on the sale of oil may find themselves in financial problems, which then impacts business life. To gain insight around the political risks, and the most risky regions, risk management advisor Aon produces and publishes a yearly ‘Political Risk Map’.

Aon - Political Risk Map

Political risks
According to the consultancy the solvency of developing countries’ governments as well as payments in hard currencies will come under pressure in 2015. The possibility of political meddling in the economic affairs is also a real risk in the coming period. The low oil price means a decrease in government income for oil producers and this increases the risk that they will not be able to meet their financial obligations. Other risk factors highlighted by the financial consultancy include the conflict in East-Ukraine, the activities of groups like Islamic State in the Middle-East and Boko Haram in Africa, but also the expectation that the US will increase interest rates.

Risk regions
The research covered 163 developing nations. African countries will be the hardest hit by the low oil price. Among others Somalia, South-Sudan, Sudan and the Democratic Republic of the Congo belong to the group of the countries bearing the most risk. Countries in the Middle-East appear to be better prepared for the consequences of decreased income as many have built up vast currency reserves to buffer the low prices. Still a few countries along the Arabic peninsula are on the list of the 20 most risky regions, which includes Syria and Iraq. Aon points out twelve economies that are running greater risks around political problems than a year ago, while seven countries have become relatively safer since last year in terms of business climate.

Aon - Interactive Risk Map

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Accenture to work alongside WPP-owned agency on Shell CRM contract

27 November 2018 Consultancy.uk

As the firm vies for a share of the design and marketing industry, Accenture Interactive has won a preferred supplier status on Shell's customer relationship management (CRM) roster. The firm will work closely alongside the brand's lead digital agency Wunderman to deploy campaigns for the international energy giant.

Accenture Interactive has grown substantially in the past year, and is presently ranked as the world’s largest digital agency by the Ad Age Agency Report. While this is something hotly disputed by design market incumbents such as WPP, further acquisitions in 2018, coupled with a growing client portfolio, have led the digital design wing of the international consultancy to increasingly eat into the market share of long-standing advertising companies.

Now, a new deal has made for some interesting bed-fellows, as Accenture Interactive works alongside WPP-owned agency Wunderman with a remit to provide "overall global strategic planning and creative direction for Shell’s CRM programmes globally." According to reports first circulated by news site The Drum, Accenture was tapped by oil and energy firm Shell to boost its marketing efforts around eight months ago, but the appointment was kept under lock and key until now.

Accenture to work alongside WPP-owned agency on Shell CRM contract

While Wunderman remains Shell's lead digital agency, having led the CRM account since 2013 when its loyalty budget was estimated to be worth £30 million. Accenture's customer experience arm will meanwhile work to support the deployment of CRM campaigns across Shell’s digital channels. The work is understood to be focused on boosting "one-to-one customer relationships" using Adobe software, as a managed service.

The news comes at the end of 12 months of change for Shell's agency roster for its retail and lubricants arms. The company has been working to reposition itself in a market moving away from heavy dependence on fossil fuels. This has seen the British-Dutch hybrid energy giant move toward renewables and backing electric travel schemes. As it enters into these new markets, CRM – a strategy for managing an organisation's relationships and interactions with customers and potential customers – has become increasingly important.

Regarding the change in its CRM set-up, Shell told The Drum it is looking to "drive deeper and more meaningful connections with customers across every touch point." The Accenture Interactive role comes with a brief including building a robust digital network for global and local campaigns.

Remarking on this remit, Joy Bhattacharya, Accenture Interactive lead for UK and Ireland, said that through "the consolidation of systems and services, we aim to drive efficiencies and scale personalised marketing campaigns, creating greater experiences for Shell customers.”