Alexander Chalkidis

Tag: retail

  • Greek retail woes part 2 – chains and balls

    Let’s say you want to plan an in store activity for a tech product.  “We have thirty stores all over Greece!” beams the person you are talking with.  Here are a few questions to ask before setting out your promotional strategy.

    1. What is the percentage of traffic of your top 2 stores relative to the rest?  Case in point, a well known chain with more than 40 stores.  The first one had 160 thousand visitors last month.    The next four had just over 50 thousand.  And all the rest had …well…very few.    Unless you want to waste money having people trek all around this beautiful country for nothing, decide where to focus.
    2. Which stores are almost dead?  In the above (real) example, almost half the stores had less than 25 thousand visitors in a month.  They are neighborhood affairs, sometimes not even fully owned by the chain, often family run or with some other story.  They might make their money on computer repairs, selling business software or anything else but what you want them to promote.   A long history of failed promotions can be told by old merchandizing kit in their stores…
    3. How accurate are your footfall figures?  Many stores have multiple entrances.  Even a keen statistician would have trouble calculating what the actual traffic was from their numbers.  Other stores have cafes, restaurants, bookshops or tickets within.  Is that the kind of traffic you want for your product?
    4. What time of day is the action?  This is very complex.  Not just about looking at the data.  Greeks have their own rhythm.  They might window shop some times of day and have the time and inclination to speak to a merchandizer but simply go in to buy supplies quickly at other times.  We have our own holidays and dates which are best to focus on.
    5. Which salespeople are the ones to influence?  Even in these times of multinationals and international (style) marketing, Greek stores often operate in a pretty old fashioned way.  There is often a person who is the gatekeeper for the store to really promote a product.  Often not even on the store floor, this might be the manager (in a smaller store) or the experienced salesperson or the person considered the purchasing expert.

    Everyone in Greece has become much better at pretending they are all business when it comes to in store promotions.  They talk the talk and look good on PowerPoint.  But way too often they operate in an old fashioned, conservative and protectionist way.  Your promoters might be shoved to a corner which looks good on paper but doesn’t work, with little help in rush hour and no real support in order to make sales or change people’s opinions of your products.

    Start asking these sort of questions though and you might gain enough respect to get your job done.

  • Don’t waste good money on Greek retail – part 1, the stats

    From afar, it probably seems like a mystery.  Greece has no money.  So why are so many tech items still selling well?  It isn’t easy to get a handle on the market as it feels pretty third worldly most of the time.

    For starters you need to recognize that there aren’t very good stats for most things.  I can cite several phone calls received from influential trade magazines looking for numbers.  They pretty much take whatever you feed them and have few reference points to know if you are making it up or not.  Often the results are ludicrous.   And they dress it up in wishy washy language or vague charts rather than admitting that “based on brief chats with two people I got on the phone from Greece….”

    Others try and make assumptions or extrapolations based on official figures or trade associations’ statistics.  The former are very sketchy as we have parallel imports galore and many other factors distorting the numbers.  Trade associations in Greece are generally weak, not very active and not very high tech or online.  If you do get any numbers they will probably be out of date and refer only to a few larger companies.  Government agencies are even worse.

    Greeks are generally secretive and don’t give away business information.  To make things worse often the IT infrastructure is spread over many different databases and software.  Many systems might not be online, relying on import/export procedures of various sorts.  So it’s not just that they don’t want to give anyone good figures about their sales;  it’s that even they don’t really know what is going on in their sales!

    A good example is store traffic data.  This is absolutely essential for planning any retail promotion and guess what?  Almost no Greek company has decent figures.  Most now have some sort of technology installed to monitor visitor numbers but they are plagued with distortions.  Some stores have multiple entrances and exits making it hard to calculate, others have cafe or restaurants within their premises making it impossible to know how many people shopped and how many just ate and left.  Sure, over time, these glitches should straighten out and give a more complete picture; if you combine them with that other data.  Which you don’t have!

    So all these fancy promotion ideas you have, well, just bear in mind that you need a rather big pinch of salt in order to implement them.  Get a feel first hand before you OK any spending. A major problem is that most “chains of stores” that Greek tech retailers say they have are in fact rather unbalanced affairs.  But more on that in part 2…

     

  • Mussolini, the world cup and financial regulation in Greece

    There is a long list of blatantly obvious match fixing scandals during the world cup.  Minor lists of mistakes like the ones compiled for the 2010 games in South Africa pale before them.  Mussolini extended a match’s running time until Italy won!  In fact, I would argue that football is a sport actually designed to encourage match fixing.  After all with such a large playing area, all it takes is a bribe to any one player, anywhere in the field to win.  With only 10 bad runs (ie run to the ball slow enough to let the opponent get there first) any player will be effectively giving the opponents an advantage similar to getting a red card.  The rest of the team will have to work harder, will have to cover the gaps created and sooner or later the opponents will score; especially if they know which player is bribed and have adjusted their strategy.

    I try to learn from my mistakes.  My tenure at PublicWorld taught me a lot about the corporate world.   I welcomed the opportunity to see the other side of things. As an entrepreneur I always tried to figure out why as customers, large corporations very often ‘acted crazy’.  My contacts would vaguely mention a board meeting, the stock exchange or something similar and we would leave it at that.

    But I didn’t spend all that time studying and travelling for nothing.  1200 mainly foreign contacts at LinkedIn are there to teach me stuff!  A lot of reading since and armed with my experience first hand, I kept tab on the company over the past year.   As a learning exercise.  It wasn’t just an ego thing or the curiosity to discover whether my conclusions were more accurate than the managers staying behind.   It became a proper learning exercise.  So when something major happens, like Fnac leaving a market, I decided to revisit in earnest.  Why on earth should Public (a retailer similar to Fnac in many ways) buy two of the three stores Fnac is leaving behind?

    While the Obama administration battles to pass it’s second major bill after healthcare on financial regulation, it is obvious that there is long way to go yet.  Not only is the global playing field completely uneven, but there are still huge loopholes.  I received today a copy of the published accounts of PublicWorld.  At the bottom the chartered accountants boldly state:  “Without any further doubt in our opinion you should take special note of the fact that the company’s own assets are now negative and so call for application of article 48 of law 2190/1920.”  This is a clause which specifies that suppliers can demand immediate payment because the company is deemed uncreditworthy.  It is approximately the same as Maradona using his hand to score a goal.  The entire planet sees it, yet not the player, not FIFA or anybody else does anything about it.   The referee is the only one with an excuse as things happen quickly and he honestly might have missed the cunning move.

    The media of course do nothing about it.  There seems little demand.  In football the fans want to believe the myth of fair play.   In financial markets, small players who are effectively gambling, want to believe that there is a sense of logic in what they are doing; that it is better than visiting the casino…