Italian Innovation Points to Growth Possibilities

Italian Innovation Points to Growth Possibilities

The complexity of operating in the Italian marketplace was a clear refrain heard repeatedly during Linkontro, Nielsen’s flagship client event in Italy.

Attendees at Linkontro met to discuss how to focus on innovation against a backdrop of low consumer confidence, ongoing political instability and expansive bureaucracy.

With more than 600 of Italy’s leading executives in the retail, manufacturing and media industries gathered for the event in Sardinia, off the coast of mainland Italy, speakers wasted no time in identifying points of concern that may lead to opportunity.

  • Nielsen Country Manager, Roberto Pedretti, opened the event by reminding attendees that the traditional neighborhoods they had served for centuries were forever changed by the digital habits of young consumers. Pedretti painted a picture of media habits of a typical Italian 18-year-old and urged manufacturers and retailers to immerse themselves in the lives of the modern consumer. He encouraged brands to focus on delivering authentic messages and to become a natural part of the modern consumer’s day.
  • During a panel session examining where new development should begin, Franco Pugliese, General Manager of Conad, one of the largest supermarket chains in Italy, said Italy sometimes appeared to lack the confidence it needed to drive change.
  • Attendees heard from the panelists that Italy appeared to have lost its place in the world and that the primary commercial mission of Italy had been lost. They agreed that for Europe to recover from tough times, it was also important for Italy to win.
  • Giuseppe Lavazza, Vice President of Lavazza, said Italians were good at entrepeneurship and innovation but had also gotten good at “creating obstacles” in the regulatory world. He cited labor, tax, health and safety laws as examples.

For faster change, the panel urged a move away from the red tape plaguing new and established businesses. They warned that investors would avoid Italy in favor of countries with more favorable environments for growth.

Academic Michele Boldrin, of Washington University in St. Louis, said as an Italian looking in on his home country from the United States, he saw “crazy public debt” and a labor market riddled with high costs. Boldrin said it was imperative for Italy to create comparative advantages over other countries in Western Europe. He also cited an ongoing brain drain because talented young people found it difficult to penetrate the hierarchy of businesses in Italy.

Facebook Country Manager, Luca Colombo pointed to opportunity with digitally active Italians. In a session that included Google and the Internet Advertising Bureau (IAB), attendees heard that the digital economy (in terms of ad sales) was only 2 percent of Italy’s GDP, leaving significant room for growth, particularly in the largely nascent area of online transactions.

Other sessions during the three days pointed to foreign retailers who had penetrated the Italian market in their stalwart fashion segment. Zara and The Gap are now common sights in Italian cities, a trend that came about with marketing campaigns that drove trust amongst Italian consumers, attendees heard.

On the third day of sessions, Nielsen’s European President, Christophe Cambournac, urged attendees to listen and act upon the “need states” of consumers or there was a danger they would lose them.

Linkontro was held from May 26 to 28. The event has been held for almost 30 years.