Alexander Chalkidis

Category: Business

  • Hello, pleased to meet you. Facebook can ruin your business.

    While most of the media tries to convince business people that they should all run to use social media asap, I beg to differ.   The step is simply too big, especially for market leaders.   You make a business page for your company, brand or product?   I will use it against you!   What you have effectively done is made a media channel with all your customers for anyone to use!

    Sure you could lock down the wall, but then “that’s not very social media”.   You can monitor the wall 24/7/365 but  if you take an offensive post down you might get a consumer backlash for “censorship” and “that’s not very social media”.   Despite being an early proponent of social media in business I think you really need to define your targets and then look even more carefully at potential risks.   I am not the only person being hired to ruin companies and brands through social media.

    It sort of gives a different ring to the term “viral”.   You know that kitch email chain letter you received?   Well, chances are it started from someone out to hit a competitor’s market share.   It is just much easier to knock off 5% of sales from a competitor than to get a 5% increase yourself.

    So yes, you need to watch what is happening in social media.   As traditional media crumbles, these are exciting times for anybody in the business of communication.   And yes, you might find that many new tools are really cost effective.   But they have far reaching implications to your organization’s structure and inner workings.   Which don’t always make business sense.   I have tried to change companies through their communication and it doesn’t work easily, especially when top management doesn’t change first in a very public way.   It is like trying to change a company through it’s IT infrastructure.

    As we all talk about leaving hierarchical structures behind and how media is becoming decentralised, it is useful to remind ourselves that most companies are still very hierarchical and centralised.   And for good reason.

    Several articles on this topic are available on my Greek blog – and the Branding Intelligence blog (also here).

    P.S. Some people have arrived at this post through extremely narrowly targeted Facebook ads; don’t worry, you are the only one that saw that provocative material  and as soon as I see you have clicked through I will take it down… ; )

  • Social media: turning useful employees into mindless gossip peddlers?

    That does it.   Another major Greek corporation inviting all employess to a briefing on social media.   Not “legal issues concerning what you can and can’t write online about the company”.    Not “ten useful things you need to know about how best to integrate social media in your life.”   But “how and why you should spend more time doing marketing for the company doing social media instead of your normal job.”

    No two ways around it.   We used to split people within a company to those that faced the customers and those that didn’t.   There are good reasons for this.   Not everyone is good at communication.   Corporate communication is more complicated than private chat.   You need to take into account many more factors and weight them with much more care.   Yet time and time again in the past year I see companies wanting to “enable” all their employees to speak on behalf of the company.   Marketing departments are shrinking and the extra work is going to …everyone!

    So Mr Joe from engineering is sitting in a seminar about social media.  His personal facebook page and all 120 friends used to seeing his favourites on youtube, views on politics and photos from his holidays now get a …company press release?  “Hey everybody, my company has a new facebook page, please press ‘like’ immediately!”   This may sound stupid but how far away is it from what is actually happening?

    I sometimes have difficulty switching from one project to another.   Especially in the early stages of a job when I have to immerse myself in their world completely in order to discover that best path which they haven’t seen yet.   Like an actor’s studio method I have to become one with the marketing people, management and the customer.   But this is my job and I have developed ways to deal with it.   Your employees haven’t.

    If your company has vision, strategy and everything else they keep going on about in these fashionable social media seminars then it wouldn’t need to train everyone in how to use them.    If we all understand the company’s vision, it permeates what we are and what we do.   It will wash through to what employees communicate about on facebook or twitter like it does when they chat to neighboors around the barbeque.   You don’t need to do something special.   Asking them to take on communication tasks carries the most serious risk of them losing focus of what you really hired them to do.   Your entire team can fall apart.   Publicly, on social media!

  • www.eshop.gr – The Greek version of an internet bubble

    While the rest of the world ponders if this spurt of activity is a tech bubble or not, in Greece one of the oldest ones is about to pop.   Now you could say that a company that has been around for 13 years doesn’t really qualify.   In fact in the tech industry, they should perhaps get a medal for surviving that long!   But I have been one of those annoying cleverclogs who publicly stated objections from their beginning.   So it is my pleasure to be finally vindicated by recent developments.

    Sort of.

    www.e-direct.gr was a clear cut case of a scam.   And a well executed one at that.   But Eshop.gr is much more complicated.   In internet economy terms you could almost say it was a perfect example.   It had growing turnover, even physical stores.  And – as traditional distribution crumbled from vanishing margins and credit differential – they even took genuine market share.   But they never made sense.

    At first it was their approach to business which worried me.   They had made a parallel import of Pinnacle TV tuners back then and I visited to discover what was on their mind.   Nothing it seemed.   I had never seen a sales director less in touch with the actual products he was selling.   Tech support?   Non existent.   Infrastructure?   Let’s say “problematic” to be polite!  Then I started monitoring their media spend.   Ridiculous.   They were regularly spending as much as Plaisio, even though their revenues were but a small fragment of the market leader’s.

    So it looked like a perfect example of a company grooming itself to be sold.   As long as everybody thinks they are the No1 Eshop in Greece, sooner or later someone will buy them.  Some Greek businessman who suddenly gets itchy and worried that his empire doesn’t have an e-something.   Rumours flew around about Panos Germanos (owner of such permanent money losing machines as Multirama and Public).   But here remained the problem:   nobody really knew.

    I tried to explain this all to one of Eshop’s founder, the wonderful Apostolos, back in 2007.   It was a dinner during Retail Vision at Paris and we ended up talking about our common passion of fast cars…  In 2008 I wrote a blog post urging them to sell.  “Last chance is now…”   It may be that in Silicon Valley having a failure is considered a medal for venture capitalists, but only for quick mistakes in genuinely new business ventures.   Eshop was drawing out, parallel concepts were emerging, even the founders started up other things, again in extreme secrecy.

    The Greek business scene is in fact highly political.   ie too many companies are in fact not related to the business of making profits.   Private TV channels  have been like that from their beginning, supported by some business man (personally even!) in order to influence politics.   So the occasional press release of Eshop.gr breaking this or the other record in sales was a red flag to me in communication terms.   My verdict:  guilty by omission.   Extremely selective presentation of subsets of data, it takes one to know one!

    It doesn’t really matter whether or not they survive this crisis.   In a way it gives them great cover to lay off people, close their pointless retail locations and make any other cuts necessary.   Blame it all on the economic crisis.   But without more transparency in financial and strategy matters nothing will change in the long term.

  • Why a modern Greek should feel like Achilles at sea

    While everyone gets used to what most of us saw (and wrote) all along and the Greek debt sooner or later gets restructured, the road ahead is pretty clear: we have to actually produce something!   While the media and most of the population rolls over slowly, fat and lazy from so many years of a bloated public sector, someone has to go to Troy to fight.   Much like the Greeks back then though:

    1. We are naturally skeptical. When I first saw the press release about a Greek company in the Innovation Parc I automatically assumed it is yet another scam.   So many years of seeing pseudo-business ventures makes a genuinely world standard effort hard to believe.

    2. Most just don’t want to fight, quite happy in their own villages.    Trying to talk a Greek brand name like Loumidis to turn himself into something with a proven success record like http://www.thegreekdeli.com/ is a task for …Ulysses’ cunning!

    3. We get emotional and miss the point.   Helen was probably not very happy in Sparta anyway.   Who cares if Paris loved her?    Business is business.   I see this now while monitoring worldwide media regarding ouzo, one of those products that is considered so Greek it hurts.  Like feta cheese, some people get too caught up in history to face the real enemy; anyone selling our history better than us!

    Much like Achilles, modern Greeks have a decision to make:   They can stay home and die poor and unknown, or they can venture forth to try and conquer the world like their ship faring ancestors have always done in the past.   It is written that Achilles beat the main force and landed with his handful of faithful warriors to take on the entire Trojan defenses before anyone else.   They could hardly keep him in the ship as it approached the well defended shore.   His enthusiasm for battle and immortality was impossible to hold back.

    Hand me that spear.

  • Scanning opportunities and inroads to social networking

    Old photos fade away.   Literally!   No matter what paper they are printed on, even in good storage conditions.   So as I started to scan a few from my vast – pre digital – collection I couldn’t help but feel there is a better way.   Not even an automated scanner would save me.   I want to cart off the whole thing.   It seems self evident that there is a market.   Why hasn’t it taken off?

    Well it is not organised.   Can you name a company that will handle the entire process?   Pick up boxes and return organised DVDs of the pictures, images cleaned up and available in high and low res.   While they are at it why not have them somewhere online for me to pick from.   It would be a great way for any company to get a leg up in social networking.   “Give us your pictures and we will start off your impressive photo blog!”   After all, your friends, coworkers and relatives are all in some picture somewhere.   Tag them and we email them to join!

    For anyone with more than an amateur interest in photography it is also a possible revenue source.   (Or so they think; which means they will pay more for it!)  If you have a collection of slides from travels around the world or whatever your pet interest was, they are possibly useful.   If only someone would scan and process them all…  Again it would be a great Trojan horse for someone to get your hosting business. 

    A final word of advice:  if you do scan old pictures there will inevitably be some of old girlfriends.   Give the job to a professional agency or else your wife will give you serious grief!

  • How GrecoGerman family businesses will rule the world

    It is fashionable (and easy) to target family run businesses as the source of a country’s problems.  Whether it is the Economist’s view of a region or the complaints of a middle manager who “just couldn’t get a promotion in there”.   I have studied family businesses as clients, as numbers and statistics.   I have lived and breathed one for most of my life.   And after enough years away from it now I can finally see the upside more clearly.

    The term “family business” is completely useless.   The realization came crashing down on me as I got more comfortable with “Hidden Champions” (Simon Kucher) .    Even the Economist will take note.   After admiring the mid sized companies that are driving Germany’s worldwide export leadership, it takes some getting used to.    66% of these dynamic world leaders are family run.   Sure that is down 10% from what it was ten years ago.  Which is my point.  Not even a German family remains unchanged.

    Not all families are the same.   So family businesses will also be pretty different. Kucher identifies factors unique to these winners like the drive to be No1, heavy investment in R&D, hard competition with neighbors and closeness to customers.   The fact that more people in these companies talk to customers has important implications for the use of social media too.   Nepotism may be rife in the Mediterranean but is not a given.

    Pdf summary of the presentation on Hidden Champions is here –  FamilyBusinessPotentialInGreece.   Read it and then try to picture a German family business like those described in it next to a Greek one…maybe after enough Germans have bought land and moved to sunny Greece a new type of GrecoGermanic mid sized company will conquer the world!

  • Google can destroy you. “You” being anyone and anything. Scary?

    I remember the debate in some English Literature class: will the future be like George Orwell’s “1984” or Aldus Huxley’s “Brave New World”?  I am a social media scientist by nature it seems because Huxley was always where I would put my money.  But the “soma” of our time isn’t a drug, it is information.   And one company seems to be controlling it all.

    I was chuckling to myself while watching the hilarious “Google autocompleter” video.   I almost posted it on Facebook.  But I have worried too long about this to fall into the trap.  Google is not evil as per se.   Google is wielding the biggest weapon ever to exist in human history.  Let’s hope it doesn’t get too evil with it.  But what harm is there in April fool day’s pranks like Gmail motion?

    It is getting worse than free.   When Google decides to put all companies related to GPS, mapping and anything related to pasture it is one thing.   Spending gazillions creating Google Maps, navigation software, and even promoting services around this ecosystem is worrying for competitors, annoying for lawmakers (since they don’t seem to have a profit making reason to do it) but useful for end users.  OK, it disrupted a major developing industry in ways we can’t even decipher yet.   Losing money on video serving via YouTube on a scale unimaginable to any corporation for years however is quite another thing.  It looks crazy and I wonder why other corporations aren’t emulating the “free” model.   Give away something really enormous in order to hook customers on something seemingly unrelated.

    The silly little spoof video just puts it a step further in my mind.   Google can buy or create content to disrupt the world even more! Why stop at making all books available online for free? (Whether their authors want to or not…)  In a way, they are lucky Steve Jobs is almost dead because he is the only person with the cash and the will to do something similar.   They can just buy the rights to anything they like and use it to gain eyeballs.   It would be the equivelant of BP buying distribution rights to a popular sitcom or Pampers to the next “Cars” movie and then using the publicity or forcing consumers to do something in order to enjoy their favorite show/film.   It would be like Nike buying out FIFA and stopping the final of the World Cup to say “we want you all to ‘like’ our page on facebook or we will stop the game!”

    Except Google is smarter than that.   Google has managed to keep looking like the underdog in everything it does. Google makes every evil step it takes towards an unimaginable monopoly in the search for information look like a legitimate one.   For the common good even.   It is Big Brother wearing a Tshirt and sneakers.   It is the equivelant of “soma” in Huxley’s brave new world, like a drug that keeps everyone happy, a glut of information that keeps us sedate and unable to act.

    If you aren’t too scared of getting on Google’s black list, use the comment box below to leave a response…  But the Thought Police will know instantly!

  • Branding and social media lessons from Muhammed

    We live in a sandstorm of information.   Blogs, tweets, status updates, emails, sms and everything raining down on us.  In such a desert 1500 years ago a man worked as a merchant meeting various people of the region and listening to them carefully.  He gathered data. And then what did he do?  Inbound marketing!   He went to his cave and developed a religion.  (Through revelation for those that believe this religion, no offence taken I hope !)   In this desert storm of information, make your own oasis.   Provide good information, food for thought, entertainment for all of us tired from crossing the barren wilderness.   Design an environment where we can relax.

    And once you have the people in your oasis?  The Prophet eventually went out to preach of course!   His wife converted to his religion. Impressive!  I doubt my wife would be the first convert of anything I came up with!  His family followed.   He built a circle of followers around him, like a well seeded Facebook group.   He left Mecca when things got tough, just like a brand might drop an approach that doesn’t work.   Rebranded himself as he landed in Medina and turned to diplomacy.   Like a company looking for synergies with other partners.   Like finding “friends” in social media, early adopters in technology, allies in the politics of entrepreneurship.

    And then, before it got too stale, full scale attack!  The rate of growth of Muhammed’s doctrine is still impressive all these years later. Like a viral YouTube video, his beautiful poetry conquered.   What the verse didn’t do, his sword finished off. One simple message, one doctrine in one language.   Accepting other faiths as long as they had “a book” and paid taxes.   Like letting people post on your wall.  On one common platform for everyone like Facebook or Twitter.

    Perhaps most impressive was that the rate of expansion accelerated after he died.  A few decades after Jerusalem fell to the Arabs and the Romans lost to them.   Will Apple keep up there success rate when Steve Jobs dies? The Prophet set up a system which conquered even Persia (not conquered by the Romans or anyone else…ever!), reaching Spain and setting up massive empires.   And a cultural legacy which still affects the world in a big way.

    One man.  One brand.   One product which is in fact a simple idea.   But so many tweaks along the way…

    (Blog post inspired by a truly terrible pseudo viral campaign by Nestle in Greece for Fitness products.)

  • Using paradigms to find opportunities: how an inkjet is like a coffee machine

    “So people get this 100 euro coffee machine, but then have to pay almost double the price for the capsules?”  I love consulting because you get to play with different business problems every day.  “This sounds a bit too much like the ink jet business!”   They are selling the machines below cost to people tired of instant coffee.   Or those annoyed at the complexities of semi automatic ones.   But they are then killing them with the consumables.

    “Why don’t you make a machine that simply refills capsules?”  Technically much much easier than ink jet cartridges.   There are no electronics, it is simply a plastic cup full of coffee.  In most cases, not even under pressure or in a vacuum.   And the available selection is terrible, just 3 or 4 tastes per manufacturer.   All you need is a machine that grinds coffee and puts it in little plastic buckets with a seal on top.  You could even install these machines at…ink jet refillers.  (Techies drink a lot of coffee.)   The margins are great and the taste will be better (freshly ground coffee).  Consumer choice increased.  There are no real licensing issues.   If they can navigate around a complex machine-chemical interaction like ink jets, they can do coffee.

    It is a point that has often struck me.   The first time I met up with big wigs from the U.S. arm of InFocus projectors I asked: “why don’t you make a bespoke system of interchangeable lenses?”   I have been using Canon cameras all my life because of my lens collection.  Whether you are trying to make a monopoly or break one, it is often some peripheral which points the way.   If you have deep enough pockets, you can sponsor the transition; in times of economic crisis this is a form of lending.

    A bit like giving a capsule coffee machine as a wedding present but then selling them the capsules…

  • Facebook ads don’t add up: how I proved they are cheating

    “So why don’t you cheat?”  It took me a while to recover.   My father has always been my moral compass.   He has stood through many decades of doing business with absolute integrity refusing to bribe anyone in a country where this is unheard of.   He didn’t fall for the trap of taking funding from the European Union or going to the stock market when all other tech companies where making a quick buck.   He is almost a saint in the way he helps everyone and anyone he meets, often without them even knowing about it.

    We were discussing a recent client of mine, a difficult case.   It is still in the early phases and I haven’t quite figured out how to work my social engineering magic in order to bring them clients. What my father was really asking is “how will they know that it is real customers clicking on their website and not some click farm?”   The man is a born business person and goes straight to the heart of a problem even though he has never used Facebook or any social media.

    The answer is simple.   Anyone with a slight knowledge of how to use web site analytics will see right through it.   And – more importantly – it just won’t make any business sense medium term as they will not be getting new customers and new business.   Which is what I promise them.   But this is not what Mark Zuckerberg promises my customer when he entices them with Facebook advertising.   He is simply selling clicks to ignorant business people.

    Most of my customers have already used Facebook ads before I start with them.   They are all perplexed. “I saw a big spike in traffic but then…nothing.” It isn’t just that the traffic disappears the day you stop paying for FB ads, it is that all that traffic seems to amount to …nothing.    Are you paying $50 a day?   Funny how you get a completely stable amount of hits during those days.

    This bothered me on a methodological level initially.   “What if my customers’ budgets are all spent on ‘early morning’ type people?” I worried.   So I begun to set up experiments. I split the day into particular time segments that seemed to make sense to me based on experience with status updates, Likes and such.   I am the Greek Dan Zarella after all.     Women checking Facebook between 6.30 and 8.30 are quite a specific bunch.   Organized!   Men online between 11 and 12.30 another.   Lazy!   I have even discovered a niche of females that do a “facebook lunch break”.   So all I had to do was set up the same advertisement and shoot it out to different demographics.   And then monitor it every hour to see what is happening.   (Yes, you need big monitors to handle the big spreadsheets without getting dizzy!)

    It was amazing.   “Boy, these guys at Facebook must have some really clever algorithms” I mused.   They somehow seemed to be spreading the clicks around the day.   It made no sense.   Humans are highly unlikely to be so consistent.   As the day closed the clicks trickled and everytime by midnight Facebook had managed to get the campaign to the exact daily target.   “Wow, hiring all those geeks from Google must have paid off” I thought.    “They have build something that even Google AdWords can’t do.”

    And then, somewhere near midnight, in between stats, being more online on Facebook than I think is healthy because of this project, it appeared.   Right there, in front of me, on top of the other adverts was one of my test ads.   I left the tab open and scrambled to the summary to triple check.   Yes, this one was clearly targeted to men aged 45-64.   I double check my profile.   Yes, Facebook knows very well that I am male but only 41.  So what is it doing?

    It is bending the rules! If “The social network” showed the whole world something is that someone who cheats and lies once, will probably do it again, given the chance.    The people at Facebook know that it is extremely unlikely that anyone would discover this trick.   After all most people only have one profile.   Unless you specifically set out to prove them wrong, your website analytics will be hard to monitor for such small variance in age of visitors.   And all too many advertisers on Facebook are only using it to funnel people into their Facebook page where the analytics are even worse.

    I have criticized Facebook advertising on many levels, ranging from the pathetic demographic information they provide (outside the US it is much worse) to the kind of clicking you usually get from it.   But this is different.   They are wasting what can soon become a powerful tool by rushing to capitalize on it by cheating.   Judging from their rate of improvement in search they have the brainpower to do a proper job.   They have the network to make something more powerful than GoogleAds.   They should just focus on what is unique about this new advertising medium rather than trying to bolster up the numbers to impress investors.

    10/3/2011 Just discovered an even worse thing Facebook is doing.   There are charging above the set limit!  (Article and screen grabs in Greek here.)