Shanghai must balance its traditional industries with the growth of digital economy and ensure that management understands the value of technology and implements it swiftly, said Martin Sorrell, founder and executive chairman of S4 Capital, during a media interview ahead of the 37th International Business Leaders' Advisory Council for the Mayor of Shanghai (IBLAC) on Oct 10.

Sorrell, who previously chaired IBLAC and will attend this year's edition on Oct 12, highlighted the challenges Shanghai faces in industrial transformation.

"I think these changes are not really about technology, they're about management," he said, stressing that AI adoption depends on whether management embraces change rather than on the technology itself.

Citing Western markets, Sorrell noted that economic pressure accelerates transformation, particularly in sectors such as the automotive and financial services. The rise of Chinese electric vehicle manufacturers like BYD, which produces autonomous vehicles with advanced technology at competitive prices, is forcing traditional manufacturers like General Motors and BMW to adapt.

"If BYD can produce an AV with its AV technology for $10,000 or an EV for $25,000, you're seeing the growing influence of Chinese EVs around the world forcing traditional manufacturers to change their model."

Similarly, fintech growth is compelling traditional banks to modernize.

Sorrell expects similar economic pressures to drive broader AI adoption in the West, potentially by the second half of 2026.

"My own view in the West is that economic pressure, which we see in autos and fintech, will probably start to show itself more generally in 2026, maybe in the second half of 2026," he said.

Turning to the importance of data-driven marketing, Sorrell emphasized its crucial role in enhancing a city's global brand appeal.

He said the Chinese market has the potential to become the largest in the world by 2050. However, he cautioned Chinese companies to be more outward-facing and understand that marketing strategies successful in China may not translate effectively in other markets.

He encouraged Chinese companies to prioritize data-driven marketing and agility when expanding globally.

Sorrell believes that in a world where regionalization and localization are increasingly important, understanding local cultures and customs is imperative.

Regarding the role of S4 Capital, Sorrell said that his company's global network of 7,000 employees across 34 countries allows it to understand these crucial differences in a digital and data-driven world.

He suggested that local Chinese agencies, while strong in the domestic market, may lack the global understanding necessary to help Chinese brands succeed internationally.

"Those Chinese agencies understand China, but so far they haven't exhibited, I think, an understanding of what goes on outside," Sorrell said, positioning S4 Capital as a key partner for Chinese companies seeking global expansion.