London 2012: Tragedy or Comedy?

The Olympics arrive on our shores in just a few days time. But we're so tied up in bad news, criticism and scaremongering, not to mention the weather,  it'll be a wonder that other competing countries aren't considering cashing in their tickets and spending this summer at home instead. 

To the casual reader, it's working up to be a Greek tragedy or, depending on how you look at it, a comedy of epic proportions. 

First we had the ticket debacle, then it was the sponsorship debacle, and we're now heavily embroiled in the security debacle (with a brief detour via the workers exploitation debacle). 

A comedy of errors to challenge even the best literary scholar. 

The biggest sporting event in the world and so far, as a country, we've managed to cock up the ticketing, balls up the staffing, and pretty much generate nothing but bad press every step of the way. 

In some respects it's almost impressive. 

The Olympics hasn't graced our small island for some 64 years. And, to be ruthlessly fair to the organisers, there's not much precedent for how to run the event in the UK. 

In the course of just 7 years they've had to build stadiums from scratch, re-organise public transport facilities, mount a sales and marketing operation that serves millions of customers across the globe, recruit and train tens of thousands of employees, as well as please stakeholders from every nation on this small planet. 

I'm not sure there are many companies (or governments, for that matter) that would be able to cope with the this level of upscaling and impact in similar timescales. 

G4S, a company which has 657,000 employees in over 125 countries and is the biggest of its kind in the world, has failed to deliver. But fair play to them, their original contract called for 2,000 staff. It wasn't until 7 months ago that the goal posts changed and their target quintupled. The fact they've managed to hire and train an additional 4,500 staff during that period is no small feat, irrespective of what you might currently think of them. 

Ticketmaster, part of the biggest live entertainment company in the world and accomplished at selling around 140 million tickets every year, has also struggled to win Olympic gold. Every stage of the ticketing process dogged in controversy and, seemingly, incompetency. 

So how come we're getting it so wrong? Why are all of these world class, market leading organisations failing to deliver? Who is the jester in the corner?

This isn't a case of paying peanuts and hiring monkeys. Has this been a classic case of death by committee? Too many cooks spoil the broth? The metaphors abound. 

The time for asking awkward questions will surely come. However, in the meantime, to paraphrase Lord Coe: 

If it were a walk in the park, everyone would be doing it. We have just 14 days to get this right. 

So true. 

Did Twitter Just Fatally Wound LinkedIn?

It has been a week for high profile separations. Katie Holmes filed for divorce just a few days before Tom Cruise's birthday. LinkedIn and Twitter have split up. In both cases, one partner has been seemingly caught off guard with the news. 


Celebrity break ups happen pretty much every day and, with the exception of the parties involved, rarely affect our every day lives. But when two of the world's biggest social networks are citing irreconcilable differences, then there are implications for millions of people around the globe. 


So what does this split mean for LinkedIn and Twitter users? 


Well, for me (and this is only my opinion, so don't shout at me) I think this move will firmly sound the death knell for LinkedIn. 


LinkedIn has been bumbling around in the dark for years, growling slowly, making few (much needed) infrastructure changes and really not developing its service beyond a glorified CV storage facility. Twitter's integration added a bit of life into the LinkedIn user interface and, what's more, generated interaction. A key component in a social network. 


Now that's gone, LinkedIn users are being forced to actually log in and use the platform if they want to update their network. And with user stats where the vast majority of users spend the least amount of time on the site, that's probably going to happen around once a week. If they are lucky. How long before we only log in to LinkedIn once a year? And then never?


I admit, I've been on LinkedIn for years. In fact four years ago I'd all but given up on LinkedIn. I rarely went onto the platform, more "maintained a presence" on it and I suspect I am not alone. 


Then along came Twitter and Facebook, social networking became an international buzzword and suddenly LinkedIn was alive again. People started to connect with me (connect, by the way, not actually interact. There's very little of that happening on LinkedIn) and my connections swelled. But mainly this allowed more and more people to direct message me in the vain hope of selling me something. Quite frankly, a bit of a turn off. 


Now I know that for some professions LinkedIn is a super charged networking tool. Lawyers, accountants and other professional services can find it an invaluable networking platform. Certain groups are extremely effective for building reputation and developing meaningful commercial relationships. But this just puts LinkedIn firmly into the niche category of social networks in my book. And now even more so.


Ultimately only time will tell what impact Twitter's move will have on LinkedIn. Maybe this is just the push that LinkedIn needs to redevelop a platform which is years old and in desperate need of a facelift. 


However for now, my status updates once again fall silent and may stay that way for some considerable time.

Carr Crash - Jimmy's Driving is Formula One

If you were in the UK this week, you couldn't fail to miss the furore surrounding revelations that comedian Jimmy Carr had squirreled away all his earnings into some cleverly packaged tax avoidance scheme and, despite earning £3.5million last year, paid less than 1% in income tax. 


Thrust into the limelight, Carr was harangued by the press, public and politicians for his immoral, yet perfectly legal, act of keeping what he's earned for, well, himself. But did Carr handle the situation well?


We think so. 


Carr's first engagement with the story was to say he pays "what I have to, and not a penny more" - and let's face it, who can't identify with that statement? Who really wants to pay more tax than they have to? So with the general sentiment of the public on side, his next move was to sincerely apologise. 


It was a good move on Carr's part. Swift, simple and sincere. 


Compare Carr's apology to David Nalbandian's unsportsmanlike flippant attempt to the crowds at Queen's last weekend, and they are poles apart. 


While Nalbandian seemed to implicate it was the ATP's rules which could be blamed for an angry kick that injured linesman Andrew McDougall, called a premature halt to the match and handed the tournament trophy to Marin Cilic just minutes into the second set, Carr takes full responsibility for his actions and promises to conduct his affairs more responsibly in the future. 


Nalbandian could learn a lot from Carr's humility. 


As a bonus, David Cameron waded in, branding Carr's actions (and therefore, in the process, the complicated tax laws of his own country) morally wrong. Tell us something we don't know, Mr Cameron. 


But Carr's triumph in this story, quite frankly, came on Thursday night when he addressed his audience at Stockton Plaza. 


Prepared for the heckling, and brave enough to stand up and take it on the chin, as well as fully aware that the UK's press were watching for their next installment in his so-called downfall, he faced the music. All alone. On stage. With nowhere to hide.  


Engaging with direct banter and heckling on the subject, Carr did what he did best and used satire and humour to win the day. 


Who can't resist a man who, in his darkest hour, is willing to laugh (heartily) at himself?

Working 9 to 5? What a Way to Run a Business.

The British High Street in in trouble. Mary Portas says so. The Government says so. Heck, even the shoppers say so. 


It's the economy, you see. We're all down on our luck, pulling in our reins, cutting back our spending. 


Or are we?


Having worked in retail, it has always struck me as the least flexible industry and the one least willing to change. 


Ever since Margaret Thatcher declared Britain a Nation of Shopkeepers, we've stuck doggedly to, and with misplaced national pride, a business formula which, all of a sudden, fails to take into account the market needs. 


Take online retailing as a comparison. Despite recession, it continues to grow. 


Peter Gold, Head of EMEA Retail, for commercial property specialists CBRE, commented recently that there has been “A change in our shopping behaviour has seen a boom in consumers shopping online."


It's a similar story with out of town shopping destinations. According to Trevor Wood Associates recent expansion in this sector has led to the vacancy rate for retail parks dropping to 6.8 per cent from 2010’s 7.9 per cent.


These are more than green shoots in a flailing economy. 


But both of these industry sectors have something very similar in common and, specifically, in contrast to the traditional High Street. Their opening hours. 


The internet, by its very nature, is open 24/7. You can shop when you want and, thanks to mobile phone technology, wherever you want. 


Out of town retailers frequently stay open longer than their High Street counterparts, closing their doors at 9pm or 10pm and even, in the case of some supermarkets, staying open all night. 


The High Street, by comparison, dogmatically refuses to bend, opening its doors at 9am, shutting them again at 5pm. Their excuse? Well hardly anyone comes in between 5pm and 6pm. At 9am, however, it's a common sight to see shoppers queuing out the door........


Like many so called consumers, I work full time. Which means that it is simply not possible to shop during "normal" High Street opening times. Put in simple terms, potential access to High Street shops every week is only 30% for me - hardly optimum. 


For out of town stores, thanks to longer opening hours, that rises to 50%. 


And for internet, it's 75% (I'm not sleeping in this scenario, just to prove a point). 


Little surprise, then, that I spend more online than I ever do in person. Need a book? Amazon. Need some clothes? Next Online. Need some food? Just-Eat.co.uk. Need some groceries? Tesco.com. Need to travel? Expedia.co.uk. 


Retail is not alone in perpetuating this limiting 9 to 5 culture. Other businesses do it too. Hairdressers. Beauty Salons. Doctors Surgeries. Cafes. The list goes on. 


Which makes me wonder: are they really opening for business?


Strikes me they'd be better having the morning off and working later. Portas has a long list of recommendations on how to revitalise the High Street. 28 of them to be precise, covering things like market days and better business rates. None of the 28 recommendations suggest more flexible opening times. 


Isn't it time, as a Nation of Shopkeepers, that we actually opened for business?

Know your Market: Lessons from Eurovision

Sweden is Euphoric with their Winning Entry

I missed Eurovision last night. The biggest television show in Europe. The longest running television show in history. The greatest example of how a normally competitive country can be totally out of touch with its marketplace. 

When the BBC announced earlier this year that the UK's entry would be sung by Engelbert Humperdinck I was genuinely upset. As a long time Eurovision fan, I have been watching the show since the age of 5. The winning act that year was Bucks Fizz with Making your Mind Up. And it certainly made my mind up. Eurovision was a programme all about singing, dancing, and music. What's not to like?

But, at its heart, it's a contest. 

And like any contest, there are judges. In this case, those judges are the great European public. A fact that seems to have escaped the powers that be in the British Eurovision Entry Management Team for the past 10 years or so. 

We like to blame it on the politics. Heck, this year we're even blaming it on the placing in the show. But the fact of the matter is that our entries are so out of touch with the target audience, that we're never going to win. 

Eurovision is a musical mass marketing contest as much as anything. And, just as in business, making sure your product meets the needs of the market is of critical importance. 

That was why, as a former short term resident of Italy, when I heard Sweden's song performed at the semi-final on Thursday night, I immediately said to my husband "I bet that's a massive club hit right across Europe, that's bang on target market. There's your winner." - turns out I was right.  Should have put a bet on. 

So what business lessons can we take from the UK's miserable performance? Quite a few I think. 

Firstly, know your market. The UK's arrogant, supercilious approach to Eurovision is what has left it out in the cold. The UK is failing to engage, and failing to understand who the voters are. Eurovision is Europe's X Factor. That means its voters are likely to be (largely) in the younger age brackets. Selling them an aged, albeit international superstar, as a cutting edge performer and they are bound to smell a rat. Treat them like musically inferior imbeciles and they'll punish you with votes or lack thereof. Which brings me nicely on to point number two. 

Respect your market. The UK's sneering, jeering and childish assumption that it is musically superior to the other entries and, indeed, to the 300 million Europeans listening to them, is why it keeps languishing at the bottom of the results table time after time. If you want to be supremely successful in business sometimes the mass market is more effective than the niche market. Niche only works if you can charge more. 

And finally, serve your market. Give them what they want. Europe likes dance. They like rock and metal. They like traditional ballads. Highly synthesised pop tunes may have worked for Bucks Fizz in the 1980s but the world has moved on. Give them something they can dance to. Something they can sing to. Give them something uplifting - half of Europe is practically bankrupt, it's no surprise that the winning song is entitled Euphoria. 

So the next time you're tempted to blame the politics, the economy, your positioning in the market, take a long good look at your business and ask yourself: Do I really know my market?

Titanic Expansion means Groupon's Sinking is a Mathematical Certainty

It would seem that those in the know have suddenly woken up to the fact that the digital industry’s cash cow, Groupon, may have turned out to be more of a dog. Duncan Parry’s column for The Drum explored the possibility of what it might mean if the digital wunderkind Groupon goes down. Just like the Titanic did 100 years ago.

For quite some time, Groupon has been troubling me. The old adage that “if it looks too good to be true, it is” should have rung alarm bells all over the place when Groupon soared into our consciousness. We’re slap bang in the middle of a recession, and traditional media is losing ground so anything that connects businesses to customers for the greater good of all is a great thing, right?

Wrong. The fact that Groupon is perceived to be in trouble comes as no surprise, and to paraphraser Titanic’s architect Thomas Andrews, I believe their failure is a mathematical certainty.

Economically speaking, Groupon produces nothing. Its “product” is provided exclusively by third party businesses that sign up to a marketing scheme that pledges to connect them directly to an enormous audience at no direct cost.

But when you start to look at the indirect costs of using Groupon it takes on a very different shape.

Let’s begin with a minimum discount of 60%. So your product, which normally retails at £100, is now to be sold at the vastly discounted price of £40. Then let’s take off VAT at 20% which will leave us with just £33.33 to play with. Now here comes the ball breaker. Let’s take 50% of that value away as Groupon’s success fee, leaving the product/service provider with just £16.67.

The indirect cost of marketing on Groupon: 83.33% of turnover. That’s before you’ve created or delivered the product or service in question.

Forget Charles Ponzi, Groupon’s business model makes his scheme look positively philanthropic.

No business can sustain marketing costs in excess of 80% for any period of time. Those that try are inevitably going to go bust, those that don’t will find themselves working for “nothing” in a vain attempt to service those customers that have bagged a bargain and who will undoubtedly move on to another service provider at the earliest opportunity.

Which is where Groupon’s negative PR comes into play: Cupcake Calamities are warning signs or a business in distress and if Groupon’s suppliers are beginning to feel the pinch, it’s only a matter of time before it travels right up the supply chain and inevitably into the hands of the consumer.

In fact, it’s now such an issue, that the OFT has stepped in to tell the internet giant to pull up its socks, or else. It’s the Titanic equivalent of the HSE stepping in to suggest that the insertion of those rivets could be better…..

In order to grow, Groupon needs a never ending supply of third party product and service providers. And in a recession these are becoming increasingly thin on the ground. In short, Groupon’s market shrinks every day.

Shrinking markets are not good news for any business or its investors. The fact that the clever people on Wall Street, who supposedly analyse businesses for a living, have not cottoned on to this before now is a mystery to me. How did they think Groupon was going to continue to grow? Geographic expansion was inevitably only going to get them so far.

Groupon, like the Titanic, has been subject to a great deal of arrogant media noise but if we learned anything at all from the dot.com bubble and crash, it was that the hype counts for nothing and that the fundamental rules of business have not changed. The clock is ticking.

THIS BLOG FIRST APPEARED ON THE DRUM ON 16 APRIL 2012

Why your Bin is a Useful Marketing Tool

This week I was inspired my bin. But before you think I have completely lost my mind, let me tell you why. 

Marketing is a complex activity. There are literally thousands of different media to choose from, and millions of ways you can communicate with your customers. The vast majority of these cost the participating businesses money. 

I am forever being asked "Will X work for me?" or "What about Y?".

But some of these media are (literally) dying on their feet. 

Take the Yellow Pages/Phone Book advertising market for example. I'd fashion a rough guess that this industry has more than halved in size in the last 4 years. Why? Well, because of the internet, of course. And the market's changing behaviour. 

This week I, like many other individuals and businesses, received the Phone Book. 

Both at home and at work this free tool, filled with hundreds of adverts, met the same fate. The ended up in the bin. Unopened. 

They are of absolutely no use to me whatsoever. The only thing I felt remotely guilty about was that it couldn't be recycled. I use the internet if I need a phone number for a business or I'm looking for something in particular. I have done so now for years. 

And in previous years, the Phone Book and the Yellow pages have had pride of place in their own drawer in the kitchen. But now I'd rather put the drawer to better use. I have no need to retain the clutter. 

Other "marketing" materials to fall victim to the same treatment include numerous unsolicited direct mailers, magazine inserts, and let's not forget the "virtual" bin, email marketing campaigns and discount coupon offers. 

So, the next time you are looking to put some of your hard earned income into marketing your business take a look in your bin first. You never know, it might just save you a LOT of money.