Passing on gas: don't point fingers

Of course, I've been following the news of the Ukraine-Russia-Europe natural gas debacle. It's hard not to when you're living in the middle of it. Friends and family have asked if we're sitting in our homes freezing or if we've started to burn the furniture yet. Neither is the case. The radiators are warm and we can even keep turning on our Christmas tree lights. How long that will last, I don't know but we're living in the moment.

I've been working a post that gives my opinion on the whole mess. But there has been so much written already, that I don't want to regurgitate all of it, and I don't want to write a book. But this morning I read a commentary in The Moscow Times that prompted me to respond. The commentary, written by a French deputy, annoyed me on a number of levels, not all of which I addressed in my response. In general, anyone who tries to point the finger exclusively at one country makes their objectivity suspect in my book. And the fact that this person seemed to touch on practically every aspect of the Kremlin's version of things, makes it even more suspicious to me.

But instead of writing a full analysis, I decided to merely post the commentary and my email response to the editor. Feel free to send your response to them as well. I kept their contact info in the article. I'm told that my response will be printed in the next letters-to-the-editor section.


FROM THE MOSCOW TIMES

Kiev Must Pay the Price For Victimizing the EU

15 January 2009

By Thierry Mariani

The crisis between Russia and Ukraine that threatens gas supplies to Europe each year was caused by Ukraine's refusal to pay Russia what it owes and the attempts by Kiev to escape its responsibilities. Throughout this conflict Ukraine tried to put pressure on Europe, using it as a pawn in its economic dispute with Gazprom and to avoid paying the billion dollars Kiev still owes.
At the onset of the crisis, Ukrainian President Viktor Yushchenko made multiple reassuring declarations affirming that Russian gas destined for Europe could continue to transit through Ukrainian territory -- regardless of what happened in the conflict with Moscow. We have seen what his promises are worth: The Ukrainians have not respected their commitment.

This manipulation of Europe by the Ukrainian government is even more questionable than it may appear. Each day it becomes more and more evident that Kiev's stance was driven by internal politics and rivalry among the top Ukrainian business clans. Yushchenko left the field free for Naftogaz to break negotiations and has continued to block attempts by Prime Minister Yulia Tymoshenko to mediate the conflict.

Europe should not have to pay for these mistakes. Europeans have been the victims of Ukrainian blackmail as well as Kiev's incapacity to insert itself into a global market economy and achieve political maturity. The envoy of European observers to Ukraine was an indispensable measure for the return to normality, but it is not sufficient in the long term. This situation cannot continue. We Europeans must think now about the future.

With regard to our supply levels, we must begin to work on finding diverse ways of transporting Russian gas to Europe -- for example, the Nord Stream project to transport gas through a pipeline under the Baltic Sea or the European Union- and U.S.-backed Nabucco pipeline, which envisions transporting gas from Azerbaijan and/or Kazakhstan through Turkey and the Balkans.
On a political level, this crisis confirms the urgent need to reinforce the partnership between Europe and Russia, which is essential for the equilibrium of the European continent. Ukraine can and should have its place in this partnership, but the country must understand that this depends on its own actions -- particularly, its ability to provide political and economic stability.Thierry Mariani, a deputy in the French National Assembly from the Union for a Popular Movement, is president of the Black Sea Economic Cooperation.

Thierry Mariani, a deputy in the French National Assembly from the Union for a Popular Movement, is president of the Black Sea Economic Cooperation.

To Our Readers
The Moscow Times welcomes letters to the editor. Letters for publication should be signed and bear the signatory's address and telephone number. Letters to the editor should be sent by fax to (7-495) 232-6529, by e-mail to oped@imedia.ru, or by post. The Moscow Times reserves the right to edit letters.


MY RESPONSE

Dear Editor:

Thank you for publishing Mr. Mariani's insightful yet disturbing and one-sided commentary. It speaks volumes about the current problems with Ukraine, Russia and Europe and the attitudes which perpetuate them. Anyone who is familiar with Russian and Ukrainian relations, particularly since 2004, should understand that there are always at least two sides to every story and every conflict in this relationship. Informed people know that this gas crisis is not merely a commercial dispute, and anyone who points the finger exclusively at one country or the other suggests to me that person is either ill-informed or biased in some way.

I do agree with Mr. Mariani that Europe needs to diversify its energy supplies. But it needs to diversify its energy sources as well as its routes, particularly central and eastern European countries. Merely shifting the pipes through which Gazprom's gas flows may be a short-term solution for Europe, it does not change the fact that Russia has shown itself willing to use energy as a foreign policy tool. I don't blame them for that, but it is a fact that must be considered as Europe plans its energy strategy. I hope the western European countries will listen and learn from the experience of their newer member countries.

I am not an apologist for Ukraine's political leaders. In fact, the opposite. All of them have let down their citizens. Guided by their own self-interests, they are the main obstacle, to use Mr. Mariani's words, to the country "inserting itself into the global economy and achieving political maturity". The past four years have been extremely disappointing for anyone who cares about Ukraine's political, economic and societal development. However, one cannot deny that Ukraine's geopolitical status makes it an extremely important political battleground for other countries' to achieve their own foreign policy goals, which only exascerbates its internal divisions.

It is disappointing to see this opinion coming from an EU citizen who is also leading a regional body whose mission it is to foster economic interaction and harmony among the Black Sea countries. Even if this is Mr. Mariani's position in his private dealings with BSEC's members, it seems to me that publishing these kinds of opinions only polarizes people and squelches open discusson.

I hope that The Moscow Times has remained an independent publication and will also publish opposing or more balanced opinions (whether it is mine or someone else's) to give your readers a balanced viewpoint on which to base their own opinions.

Thank you.

Tim McQuillin

Innovation for Ukraine?

I listened to podcast today, part of the Entrepreneurial Thought Leaders series organized by the Stanford Technology Ventures program. Tom Kelley from IDEO spoke to group of students at the opening of the Global Innovation Tournament about how to form habits that preserve their creativity, stay young at heart, and be an innovator for life. He had 5 pieces of advice:

1. Keep an "international traveller's" mentality. In other words, a heightened state of alertness and awareness of your surroundings and human behavior.


2. Treat life as an experiment. Be willing to fail, and learning from your failures.


3. Have an attitude of wisdom. A healthy balance between a confidence in what you know, and distrusting what you know just enough to give you a thirst for knowledge.


4. Use your whole brain. Applying the left brain, which is what most education trains us to us, and right brain at the same time. Find time to let your "tortoise mind" work. This is the part of your mind that kind of works in the background, and which grows ideas over time, and leads you to the "aha!" moments.


5. Find your muse. Know what makes you most creative. It can be while listening to a certain kind of music, being stimulated by lots of noise or quiet, or certain times of day. Follow your passion.

Coincidentally, he mentioned a quote by Marcel Proust that I had until recently put on my Windows Messenger message: "The real act of discovery consists not in finding new lands, but in seeing with new eyes." So that grabbed my attention.

I have 2 questions that I'm hoping to get a lot of commentary about.

Is there innovation being done in Ukraine for Ukrainians?

Honestly, I haven't seen much of this although I'm sure it must be happening somewhere. In the course of daily life I tend to notice the lack of innovation, or even the effort by many companies to take advantage of past innovations. Stuff like packaging milk in a box or other sturdy container instead of a bag. Packaging plastic wrap in boxes with a serrated edge so you can tear it off without shredding it or cutting it with a knife.

Don't confuse this with creativity. I see acts of creativity and even ingenuity regularly. As usual Wikipedia offers a good explanation of what I mean:

Innovation typically involves creativity, but is not identical to it: innovation involves acting on the creative ideas to make some specific and tangible difference in the domain in which the innovation occurs. For example, Amabile et al (1996) propose:

"All innovation begins with creative ideas . . . We define innovation as the successful implementation of creative ideas within an organization. In this view, creativity by individuals and teams is a starting point for innovation; the first is necessary but not sufficient condition for the second".

For innovation to occur, something more than the generation of a creative idea or insight is required: the insight must be put into action to make a genuine difference, resulting for example in new or altered business processes within the organization, or changes in the products and services provided.

If you know there is innovation happening, what are some examples and which companies and/or individuals are leading this innovation?

The only industries I can think where innovation is taking place in Ukraine is in the IT, science and pharmaceutical industries. But, unfortunately, I think most of this innovation is being done by or for foreign companies and most Ukrainians don't feel it. I'm looking for products, services and methods that are being offered and applied in Ukraine.

I'd love to be surprised with a lot of examples. Looking forward to your comments.

Where is George Bailey when you need him?

While my list of mobile industry topics I'd like to cover grows, the impact of the economic crisis and bank-related issues continue to take center stage in my mind for now. And for some reason, my banking experience during the past few days brought to mind that classic American Christmas tear-jerker, It's a Wonderful Life. For those of you who haven't seen this movie, here is the Wikipedia entry about it. It is a must-see in America during the holidays, with at least one cable channel using running a 24-hour marathon. Despite being released over 60 years ago, the situation in the clip below will be eerily familiar to today's Ukrainians:


These days I can relate to the depositers in this clip who stormed the Bailey Brothers' Building & Loan looking to withdrawal their savings. That's exactly what I went to do, as well as change it from hryvnia into dollars. This not so much anymore because I fear my bank will close its doors, but mainly due to the risk that the currency with further devalue.

Although in the end I completed my transaction, it took me 7 visits to 3 different bank branches over 3 days to do it. Actually, by Ukrainian banking standards that's not too bad, especially considering most bank employees were friendly, efficient and, of course, actually allowed me to do what I needed to do. Below are the main highlights of my experience:




Day 1:

• Branch #1: I'm told that there is a limit on the amount of dollars I can buy each day from a given branch. At the same time, I'm informed that I could repeat the transaction at an unlimited number of branches per day. Don't ask me what sense that makes. After completing my withdrawal and dollar purchase at Branch #1, I casually ask if I could also buy euros, even if I'd max'ed out my dollar limit. The answer is "yes". Again, don't ask me why. Result: 13% complete.
• Branch #2: After a 20-minute walk to the next branch on a bitterly cold day , I'm told there that my limit for buying dollars per day is not X, but 3X. Good news, but they couldn't explain to me why Branch #1 told me X. Result: another 13% complete
• Result for the day: about 25% completed

Day 2

• Branch #3: I remembered that a new branch opened up near my apartment, so I thought I'd save some time and make a withdrawal there. The quite snitty and self-confident bank teller there informs me that it is illegal for the bank to sell foreigners like myself currency. When I explain that two other branches sold me currency yesterday, she simply shrugs, indignantly said her memo informed her that is impossible, and shows no interest in looking into the matter. After many run-ins with these types of people over the years, I've learned not to waste my time on them. So I quickly tell her she is wrong and set off for the better informed branches. Result: 0% completed, 30 minutes of my time wasted, and my patience lost
• Branch #2, Visit #2: The same teller I spoke with on Day 1 tells me that she got yelled at for selling me currency over the X limit. She doesn't have any dollars to sell, but tells me to come back near the end of the day and she'll probably have some. Result: 0% completed, 1 hour of my time wasted
• Branch #1, Visit #2: I play dumb and tell the teller I'd like to withdrawal hryvnia and buy dollars. "How much," she asks? "As much as I can," I reply. I learn for the first time that there is a daily limit on hryvnia withdrawals. If converted to dollars, this limit is almost 7X the original dollar limit I was told. After checking with her colleague, the teller tells me I can buy 4X dollars and 2X in euros. Again, good news but why didn't any of the other tellers do this? For some reason, this transaction involved additional paperwork to be completed, but after about 45 minutes standing at the window, I had my money. Result: another 50% completed
• Result for the day: another 50% completed, but half my morning wasted to get it done

Day 3

• Branch #1, Visit #3: No messing around this time, back to Branch #1. This time all goes smoothly. My remaining balance is withdrawn, dollars purchased (3X the original limt I was told on Day 1), streamlined paperwork process (for some reason).
• Result for the day: mission accomplished

What would George Bailey think about this experience? He'd probably say that I should be grateful to get my money at all.

Unfortunately, a vast majority of Ukrainians believe that their banks are run by a bunch of Potters, even in the best of times. Given their experiences to date, whether the result of bank policy, government regulation, or incompetence, you can't blame them. My first inclination is to be suspicious of banks, which makes me ultra-sensitive to the inconvenience and inconsistency of information that I had to go through, especially because I think this type of thing would happen even without a crisis.

I can't say that George Bailey would have convinced me to leave my money in his bank if it had a Ukraine address. But then again, George Bailey probably would either have lost his bank to some oligarch or government official, or become one himself by now.

Stop, thief!

Walking on Maidan Nezhaleznosti the other day, I saw this banner and understood enough to know it was connected with the economic crisis. I thought I should probably snap a photo of it just in case. I was told later it translates roughly as:

ESCAPING THE CRISIS IS NOT AN EXCUSE TO STEAL FROM THE WORKERS!

Don't take back people's salaries!

Don't lay people off!

I'm not sure who exactly who is sponsoring this banner, but I believe it is some kind of workers' union. While I can't blame them for defending the interests of their members, I can't buy into equating business owners and managers who lay people off and cut salaries as stealing from the people. Granted, there are employers whose owners may actually did steal from the people 17 years ago to get where they are. But does lumping in all companies together like this really help? To me, it creates another division within a country that already has too many.

Don't get me wrong, I'm quite pissed off at the American financial system for the whole sub-prime mortgage fiasco, and think someone needs to go to jail and give back lots of money, not to mention keep an eye on these guys in the future to prevent this from happening again. But accepting the underlying premises of the belief expressed in this banner would get one a lifetime Communist Party membership. And at the risk of sounding insensitive, I also think it perpetuates the legacy of an entitlement mentality, that has been a drag on Ukraine's economic progress and social reform.

I'd be interested what alternative these guys are giving to entrepreneurs and businesses who are facing the prospect of bankruptcy by continuing with business as usual. In that case, who is trying to steal from whom?

Anyone have another opinion?

Excuse me, I just fring-ed

I'm not sure if ahead of the curve or behind it on this one, but I just added a new application on my mobile phone: fring. It not only fills a "want" in my mobile life, but also provided a great user experience during set up and with the user interface. Therefore, I wanted to reward them with a little free PR. I'd heard of it a while ago, but didn't pay much attention until saw that it allows you to add Skype as an add-on. Having family in the US, we have long used Skype and, more recently, Oovoo a lot for free video calls. I have a US SkypeIn phone number and keep a balance for SkypeOut balance for international calls. I forward calls from Skype to my Ukraine mobile phone for "when I'm mobile", in case my family tries to call. The only piece of the puzzle missing for me was the ability to make outgoing international calls and send messages from my mobile without paying high mobile calling rates. And it would come in handy because I occasionally find myself running late for our weekly family call, and want to let others know. Now I usually just send a quick email from my phone, but there is no guarantee that they will see it in time. So, all in all, outgoing mobile Skype capability is a "nice to have", not a "need to have". But it's also cool to have the regular phone numbers in my Skype contacts list on my mobile in case I want/need to make international calls while "on the go". And it also has all Skype features, so I can send files (e.g. photos) stored on my phone in addition to voice and IM. I can email them probably just as easily and to multiple people, but it's nice to have options. Of course, the next challenge is to find a way to use Skype while avoiding hefty roaming charges while traveling outside of Ukraine.

As for the user experience, the website was extremely clean and easy to navigate. All I did was enter my country and mobile phone number, and within 1 minute I had the SMS with the link to download the app. The online instructions for adding VoIP services weren't too helpful, but the installation process on the phone was so easy I didn't even need it. I literally had the thing up and running under 2 minutes. The user interface on the phone is also quite clean and easy to use. The ease of using the service and the set up process is almost too good to be true. Having become somewhat cynical about the quality of many mobile apps, I am preparing myself for disappointment down the road. It can't be this easy. And how can fring do it while Skype is only offering a beta version for mobile that only has full calling capabilities with select countries, of which Ukraine and the US are not included. I'll have to look into that further. But kudos to fring so far.

By the way, fring has its own IM service, which makes me respect them even more. Instead of trying to force you to use their service, their app lets you also choose to use Skype, Facebook, MSN Messenger, ICQ (which is the most popular IM service in Ukraine), and others. I don't know if they have a Russian-language version. The menu is so simple, they may not need it, but it might help adoption.

The mobile operators may fight them, though, because they would cut into their international calling revenue. But I think there is probably a business case for a, ahem, forward-thinking operator, to embrace an application like this as a way to generate more messaging traffic. Another avenue may be to work with a mobile device maker to get the app pre-installed. Hmm, that might just be crazy enough to work.

Window to Ukraine is open - peek in if you dare

Well, after a 5-month stint helping Microsoft build its Windows Mobile presence here in Ukraine, I finally have some time to once again open the curtains on my personal window into Ukraine. While I have lots of new gleams flashing through my head about the mobile industry and now smart devices, the hot topic on my and everyone else's mind is the economic crisis. How bad is it? How bad will it get? How long will it last?

I say from the start that no one outside the handful of banks and puppet masters controlling the Ukrainian economy have a good idea which way things will go, particularly over the next 6-9 months. In fact my wife recently attended the Adam Smith Conference on real estate last week, and some of the analysts said they've given up for now trying to forecast the real estate market. I've heard similar utterings from other business people I've spoken with. So while I am far from an economist or even a financist, given that everyone's crystal ball seems to be foggy, I guess my opinion is as good as anyone else's - which is scary.

I've heard varying opinions about the economic outlook, ranging from the very negative to cautiously positive. The positive say that Ukraine is facing an "artificial crisis" caused by the credit crunch, and that the current fall in demand will quickly bounce back once the credit situation stabilizes and NBU unfreezes bank accounts. Yes, many people including myself cannot get access to some of their money in local banks. The impact on consumer demand, they contend, was driven primarily by the panic caused by the fallout of the sub-prime mortgage crisis in the U.S., and the hryvnia's subsequent 20% devaluation versus the dollar in October. Beyond that, everything else is largely psychological. So, if everyone calms down and doesn't over-react, they say, everything will go back to normal.

I agree that people should not panic and, in fact, most people have calmed down to a state of heightened anxiety, which is probably quite rational right now given the current instability. However, I think the impact on people (i.e. consumers) will be more than psychological, and that things are going to get worse before they get better. In a nutshell, my reasons are the following:

1. A large part of Ukraine's economy are commodities and depend on exports, so when other economies fall like dominoes into recession, that will severely hurt these industries.
2. Business expansion and consumer demand during the past several years was fueled largely by credit denominated in foreign dollars or euros. The hryvnia's devaluation has pushed up interest rates and the monthly payments of these loans, creating a high risk of default and a drag on additional consumer spending.
3. While consumers' monthly loans payments are increasing, as well as the cost of most other items, more and more are being laid off or being forced to take salary cuts as businesses go into survival mode. Granted, salaries also rose a lot during the past several years, so certain segments of the population will be relatively unscathed. But, as usual, the middle-class will take the hardest hit just as it was beginning to develop.
4. High-level corruption is still alive and well. You can be sure that the economic power brokers and government officials will take care of themselves first. And I'm not talking about simply taking advantage of the "buy low, sell high" approach or doing what it takes to merely stabilize their companies and take a reasonable profit. You can be sure they see this huge opportunity for siphoning off more state and foreign funds, and are actively expropriating as much money as they can as fast as they can during this period.
5. Not only is the Ukrainian parliament on vacation (physically and mentally) during this crisis, the entire government is not functioning. The politicians are using this as an opportunity to either gain more power or simply weaken their opponents. There is no patriotic feeling to put country above self.

So, I believe the economy is going to get worse over the next 6-9 months before it gets better. On the bright side, I also think that it will be somewhat healthier when it comes out on the other end. Real estate prices may come out of the stratosphere, smart companies should be somewhat more efficient, corporate balance sheets should be stronger, and lenders should improve their loan practices and may even finally drive widespread use of credit history checks when making loans. But I say this with a good deal of skepticism. As they say, hope dies last.

Making matters worse are the external political pressures that Ukraine is enduring now, and will continue to endure, over the next several years. In case you haven't been following the news, Cold War II has started between the US and Russia. The chess board looks quite a bit different than it did 60 years ago, but the rhetoric and tactics coming from Russia are from the same playbook. Ukraine, now that it is an independent state, is the focus of a tug of war between the two countries. And while it seemed like the US and Europe were set to win at the end of 2004 a l'Orange Revolution, Russia is now gaining back some lost ground. Stratfor.com's "Countries in Crisis" series on Ukraine gives a very concise analysis of the situation in its "Countries in Crisis" series. Suffice it to say that Russia is using its considerable leverage over Ukraine in the areas of politics, energy, military, economics, intelligence, organized crime, population and even religion to either bring Ukraine firmly back into Russia's orbit or completely destabilize it.

A few of its latest high-profile tactics are:

1. Doubling Ukraine's price for gas, suing it for apparent non-payment, and threatening (again) to turn off Ukraine's supply this winter. It did this a couple of years ago as well.
2. Russia's TV channels, most of which are effectively under the Kremlin's control, are broadcasting anti-Yushchenko propaganda into Ukraine. Yushchenko recently pulled the licenses of several of these channels to broadcast in Ukraine.
3. Financial support of Yulia Tymoshenko's presidential ambitions. Until recently, Russia and Yulia were bitter enemies, but now they seem to have buried the hatchet for some reason.
4. Issuance of thousands of Russian passports to pro-Russian Ukrainian citizens, most likely with the intent to give it an excuse to "rescue" those of its new citizens who might claim persecution by the Ukrainian authorities.
5. Russia's action in Georgia was also meant to send a signal to Ukraine and the other CIS countries. Even if Georgia did fire the first shot, Russia had been looking for, if not actively provoking, a confrontation with Sakashvili and relished the idea of making an example out of him.

I understand why Russia is doing all of this, and were the US in the same situation it would probably be doing the same thing. However, if one believes in democracy, rule of law, free enterprise, and personal freedom are the ultimate end game, the difference between our two countries becomes very clear.

Regardless, the fight itself will only have a negative impact on Ukraine by dividing its citizens, encouraging the current corrupt system, and thereby delaying further the reforms needed to bring the country to European economic standards.

Sorry to make my first post in 5 months so gloomy. But I call 'em like I see 'em.

Customer experience is key - even in Ukraine

The Telco 2.0 blog is quickly becoming one of my favorites. Their analyses always combine broad, high-level, forward-thinking approaches to the mobile business with an in-depth understanding of the underlying technology that lead some really thought-provoking insights. That they tend to support my own views, albeit usually in more cogent and factual way, doesn't hurt either. ;-)

In this post from October 2007, the author makes three assertions about the mobile business that really resonate with me:

1. Communication is king and presence is a prince; content merely provides ways to communicate. The 3 types of communication are: presence, storytelling, and information transfer. Focusing on one type like storytelling misses the bigger problem with how we communicate. I also surpised by the supporting statistic that global revenue from games, movies and music are less than that of SMS.


2. The job of Nokia (and all device makers) is to create "fantastic user experiences" by helping the operators overcome structural issues and producing products that align with the current horizontal industry structure instead of trying to compete with them.


3. Customer data and the customer relationship has great value. Mobile operators own that and the handset makers shouldn't try to muscle in on that area.

These intuitively make sense to me, and I have expressed similar opinions in my work, particularly with operators here in Ukraine. In my conversations with mobile operator folks here in Ukraine, I have also emphasized the untapped potential represented by creating a better user experience, exploiting messaging services like MMS and premium SMS, and partnering with content providers. I expressed in one of several articles I've written during the past year. There is huge short- and long-term revenue potential being forfeited here all for want some very basic and relatively inexpensive improvements. For example, I have yet to be able to send an MMS with my Nokia N73 despite several attempts at downloading the settings and talking to my operator's customer care reps. Practically every other mobile user I've complained to about this tells me they have the same problem, and have long since given up trying. Upon telling this to one of the managers at my operator, he suggested that it's because my particular phone was probably illegally sold on the market and thus my local operator's settings would not work on this phone. Yes, illegal phones on the market is a big problem in Ukraine, but I've asked both a content product manager and a senior network manager at two other operators here and both of them said that sounds very strange. I can see now that there is likely substantial intertia against fixing this problem within the operator, as they have created a culture to blame it on piracy rather than invest the resources to try and fix it either technologically or through better business processes.

None of my aforementioned articles are online but if you'd like to read them, please email me and I'll be glad to send them to you.

Needless to say, as far as I know, my opinions haven't particularly inspired anyone in the industry. I'm not particularly surprised since the operators have done quite well financially so far merely riding the wave of rising consumer incomes and strong economic growth with "status quo" or worse services. As a shareholder in the two leading Ukrainian mobile operators, I haven't had too much to complain about the past several years. But, as an industry marketing professional here in Ukraine, I would love to see this market become a leader for mobile innovation, a laboratory for new products and services that could actually be leveraged in other markets. Drug companies find Ukrainians good enough to test new drugs in clinical trials, the results of which can be applied to other world markets. Apparently not so with mobile services.

Quoth one of my friends who has lived in Ukraine continuously since we both arrived in 1997, "It's never easy." Truer words were never spoken about today's Ukraine. The past 17 tumultuous years have thrown almost every aspect of life into some level of chaos - families, politics, markets, communication. Life for the average Ukrainian is quite difficult to navigate, from finding out why your water or electricity has been shut off and when it will come back, to buying a car and getting what you ordered, to setting up your mobile phone to send MMS and email. So when something IS easy, people notice it.

However, the paradox of the Ukrainian consumer is that while they have been conditioned to accept poor quality service and products, they often haven't recognized or rewarded brands that offer good quality. And they have rarely been willing to pay extra for better quality, primarily due to low incomes of most people. Companies understandably wouldn't want to invest in new and improved products if they will not reap more profit from them?

But I contend that this is yesterday's thinking. Incomes are rising quickly, particularly in the major cities. These rising incomes are driven by more demanding jobs, which in turn makes time and convenience more valuable commodities to people. New competitors are entering the market constantly, each one doing something different, if not better, than the encumbants. This is particularly evident in the retail business, specifically supermarkets, restaurants and cafes. Consumer credit is flooding the market to allow people to buy more big - and even small - ticket items (maybe too many items). So today's marketer, particularly one in the communications business, has more and more freedom to innovate. No, not freedom. They have more and more an obligation to innovate. Expectations of upwardly-mobile Ukrainians are rising with their incomes, and they have more and more alternatives to choose from.

Ukrainians' rising expectations, just like those of consumers in other countries, require the operators, device makers, application developers, content providers, and all other contributors to the value chain to decide which business each one is in, and work together to improve the customer experience. Only then will the full potential of mobile communication be unlocked. But, as pointed out by Marek Pawlowski in his article on the MEX (which stands for mobile user experience) blog, the leading device makers and operators still have an identity crisis about which business they are actually in.

Viva thoughtful advertising in Ukraine

I love chocolate milk. Back home in the States, I'd drink Ovaltine because I could offset at least some of my guilt from this indulgence by convincing myself that it's actually good for me since it has all of those vitamins. And it gives me a chuckle when I occasionally remember Ralphy's childhood innocence being shattered as he learned, after waiting weeks for his Little Orphan Annie "Secret Circle" decoder, that Annie's secret message this elite class of listener was "Drink more Ovaltine!" Classic. And, by the way, speaks loads about how some brands approach their advertising - heap on the hype to hook them and worry about substance later.

Anyway, this post is not about Ovaltine. Ovaltine isn't sold in Ukraine as far as I know. It is about its competitor, Nesquik, whose advertising I saw in the park today and which prompted me to write about the big opportunity for brands in Ukraine to build strong, longlasting customer relationships through thoughtful advertising. I know it's not a new concept in developed countries, and not even in Ukraine. Big Ukrainian brands like UMC (mobile operator), Roshen (candy), and Arterium (eh, not really a big brand but they deserve a mention as you can see in the above photo - that's my boy in the cool Gilligan hat) have for years built very nice children's playgrounds in parks around the city. But the point is that I don't think there are a lot of brands missing the boat. It also has gives the brand image an additional shine as being a good corporate citizen.

This summer Nesquik decided to paint the benches in the children's playground in Shevchenko Park, where my son and many other children play regularly almost all yearround. In the States, I would consider this a smart placement, but here in Ukraine it makes a much bigger impact because of the sad state of repair of most public (i.e. government funded) areas. The benches are painted very well normally and are quite ugly when they are. Therefore, I appreciate what Nesquik is doing by at least brightening up the play area, even it is with their brown and yellow colors and logo. I give them credit for knowing where my kids play and recognizing that there is an opportunity to make it more attractive place.

I think Nestle must have received some good feedback, as I saw this morning that all of the benches in the park are painted with Nescafe advertising. Unfortunately, the colors and paint jobs make it somewhat difficult to make out the log and tag line. Again, seems like pretty good placement as I'm sure the several kiosks in the park sell Nescafe coffee and the park is an ideal location for a relaxing cup of steaming hot Joe on this, eh, hot summer day. Maybe they should try Nestea for the summer months.

I noticed another new example of this "thoughtful" advertising on the metro yesterday while riding with my son. Being of about average height, I've always been a bit uncomfortable holding onto the bar when standing. I can imagine that a lot of women and pensioners feel the same way. Wow, I just grouped myself in with the female and elderly market segments. Anyway, Pepsi recently installed dangling handles to make it easier for these people. It's not a particularly creative execution, but it does the job of helping people and making the brand front and center. Sorry for the fuzzy photo, but you try taking a clear photo on a speeding Kyiv metro with a cameraphone in one hand and a squirming 2.5 year old in the other.

I hope these brands are fully leveraging these ideas in their PR and marketing efforts, but my experience tells me that that probably are not. I doubt Nesquik will set up a "free chocolate milk" stand or hand out free mix packets at the playground. Same with Nescafe. I at least hope that they are getting the word out to the public, and that the public shows its appreciation. I, for one, don't plan to try a Nesquik alternative anytime soon, and will begin to make a point of choosing Pepsi over Coke if available (which it usually is not, by the way).

Say what you will about the over-commercialization of society, but I and many Ukrainians would much prefer to stare at a brand's logo or message instead of picking splinters out of our behinds or having our arms fall asleep while riding the metro.

Verizon and Alltel

Chalk this one up to one of my gleams of light that I'll have to take from a stranger. I'd thought several weeks ago writing a post about the regional mobile operators in the United States and how they might be a better model for the Ukrainian operators (at least the smaller ones) than the Big 4, because the regionals had to work harder for customers and therefore were doing more innovative things.

Well, the article Is Verizon Buying ALLTEL For Its Assets or For Its Culture of Innovation? tells me that others also recognize the spirit of innovation in these regional operators. In one of my consulting projects, I used alltel Wireless' "My Circle" campaign as a great example of an integrated marketing campaign that included online advertising. Alltel was the first mobile operators in the U.S. I'd seen who tried to create an elaborate viral campaign. Although the storyline and execution wasn't the greatest, it garnered Alltel national attention and respect as an innovative brand.

I also hold up Verizon Wireless' marketing as a great example of a brand that understood what was important customers (network quality), delivering on that brand promise (making sure their network quality was the best), and creating an extremely effective communication campaign to drive the message home ("Can you hear me now?").

For Ukrainian mobile operators, Verizon provides an excellent case study in the benefits of "blocking and tackling" marketing - knowing what is most important to customers, making sure your product best meets their needs, and communicating this message in a clear and focused way. And they can learn a lot from Alltel about innovation.

Wood doesn't grow on trees, you know.

I just got back from my weekly lunch with my wife. Don't think I'm a cheapskate, because as with most things of this nature in Ukraine, it's not so much about the money as it is the principle.

As Ukraine watchers know, Ukraine is going through a serious inflation problem. Prices rose about 30% here since January, on top of 16% for 2007. Plus the National Bank of Ukraine recently lowered the official hryvna-dollar exchange rate by about 4% UAH 4.85/$1, strengthening the hryvnia to fight this inflation. Anyway, the point is that consumer prices for everything are rising.

My wife and I usually eat at a Japanese restaurant in her building. Although there are more expensive restaurants in Kyiv, it is a relatively "upscale" place. Our lunch usually runs about $30 and we don't eat a lot. Today I ordered sushi (chopstick food) and my wife ordered grilled salmon (fork and knife food). When we get the bill, I found something on the bill I didn't recognize and when we asked, we found out that we were being charged for using two sets of chopsticks. Yes, it was itemized on the bill - UAH 6 for two sets. We just started laughing. On top of that, my wife hadn't even used her chopsticks. When we asked the manager about it, she said that it is due to inflation costs of the sticks. Mind you, these are disposable wooden chopsticks. The kind you'd get from any carry out.

We'd actually experienced this type of pricing system years earlier while visiting relatives in a smaller city, Mirgorod. At this restaurant, they charged us for lighting the candle on the table. No, it wasn't a "special" candle or a request on our part. It was the same candle that was on all of the tables. And, of course, the lights were turned down very low so you actually needed the candle to read the menu.

As for the chopsticks, I know we're talking a whopping $1.20. What's the big deal, right? The big deal is not so much the cost, but what this says about the brand to a customer:

First, it tells me you are greedy. I'm no restauranteur, but I doubt a pair of chopsticks is a significant cost to you. A quick check on eBay shows me I could buy 400 pairs of chopsticks for $10 ($0.025/pair). And I'm sure a restaurant could get a volume discount and a cheaper source. Therefore, you are not merely trying to recoup increasing costs, you are trying make more profit off of me - at 1000% margin no less.

Second, it tells me that you put little value on my loyalty. In this case my relationship with your brand is worth less than $0.03 to you.

Third, it tells me that either you are stupid or that you think I am. The clientele in this restaurant are well-educated business professionals. You don't give us enough credit to know that two 8" pieces of cheap wood cost less than $0.60? Or is it that you, Ms. Manager, don't know?

Fourth, you don't understand me. Yes, I come because your food tastes good and I can (almost) always trust the quality. I also come because it makes me feel somewhat classy and cool. By using a pricing technique practiced by low-priced holes-in-the-wall you ruin that experience.

Now, we took this somewhat in stride, but if we (a regular customer among many) decide to go somewhere else (which we could easily), or let's say to fair just skip one meal in protest (which we're considering), the restaurant has lost at least $29.95 - a $30 sale to save $0.05 right off the bat. And if we find a more inexpensive place to have our lunches (which there are many alternatives) the cost goes up.

In management's defense, I don't think they've raised their menu prices (yet). It seems to me a very small increase in menu prices would be more acceptable alternative for diners, and might even bring in more money. Most of the customers can probably afford to absorb it. Maybe there are other costs to this alternative, but I have a bad habit of giving Ukrainian businessmen here the benefit of the doubt. The only cost I can see now is to reprint the menus.

But if inflation continues eating into this restaurant's profits, I suggest charging for the following overhead items:

• Use of other eating necessities like plates, forks, spoons and knives.
• Use of soap, hot water to wash the aforementioned.
• Each paper napkin used.
• Soy sauce and other garnishes. (Don't laugh, this some places actually do charge extra for lemon and sugar packets for your tea, ketchup and mustard. McDonald's even used to charge for extra barbeque sauce with your McNuggets.)
• "Pay-per-use" pricing in the restroom (e.g. per trip, toilet paper sheet, squirts of soap, paper towels, toilet flushes). Again, the paper-per-sheet thing is practiced in some public restrooms).
• Additional charge for a smile or thank you. That requires energy and training costs, you know.

Hey, I think I just came up with a new concept - "bring your own" dining.

Ukraine Little League Baseball Championships June 4-8 in Illichivsk

Corporate social responsibility (and it's PR/marketing value) has begun to come into fashion in Ukraine in the past 6 months. Most of the major brands have been doing this to varying degrees for years, but senior management has never really taken a strategic approach to this. The higher awareness could be driven in part by the oligarchs here. Viktor Pinchuk, one of Ukraine's richest citizens and son-in-law to Ukraine's pre-Orange Revolution president Leonid Kuchma, and his wife have been particularly active. Among other activities, he and his wife founded an anti-AIDS foundation, a chartered a school of economics, opened an art center, and organized a free Elton John concert on Maidan (which, by the way, was great! Elton played all of his best songs for 3 hours without an intermission). In the cases of the oligarchs, the motivation is mainly out of business interest than altruism. In a nutshell, western investors have long known that they accumulated their wealth under, to be kind, "questionable" circumstances. For many, this makes them questionable business partners. So, they are using philanthropy as a way to clean up their images (a la Rockefeller, Carnegie, etc.) in order to hopefully give them easier access to foreign capital. My philanthropic endeavors are quite a bit more modest, but in the spirit I wanted to plug my pet project here in Ukraine: Little League Baseball.

Last year I came across an article about Little League baseball in Ukraine, and for the past six months or so I've been volunteering to help the program raise money through corporate sponsors and donations. While football (i.e. soccer) is still by far the most popular sport in Ukraine, Little League baseball and softball is played by hundreds of kids across the country. They're pretty good, too! The Ukrainian 13-14 year old team is the defending European Junior League Champion. For the first time, they competed in the United States for a chance to qualify for the Little League World Series.

The program is administered by Ukrainian-American Basil Tarasko is an "old school" coach, former math teacher, and scout for the San Diego Padres. Basil has poured his heart, soul, time and money into helping the kids of Ukraine through the gift of sport for the past 13 years. He's currently here on his 50th trip to Ukraine for the championships.

Basil and Little League have many small individual and business sponsors, there has been little support (financial or otherwise) by companies in Ukraine, in my opinion primarily due to a lack of awareness. Hertz Ukraine was the first company to step up and finance the Ukrainian team's transportation costs and uniforms for the regional playoffs in Poland each year. So if you are coming to Ukraine and need a rental car, please support our sponsor and go Hertz! You even get a 10% discount off your rental if you mention Little League - I'm not kidding. And for the first time, the Odessa chapter of Lions Club International is getting involved. They will be having a barbeque for the kids and coaches, and will take on the coaches in an exhibition softball game. I know the kids and the Lions are going to have a great time!

Ukraine Little League also includes 12 orphanage leagues across the country, including one league for deaf orphans. Basil's dream is to hold the first national Little League Baseball Championship for orphans. This would not only be the first in Ukraine, but the FIRST IN THE WORLD! The Kyiv chapter of Lions Club International has graciously donated money to help us give these orphans an opportunity they'll never forget. But, we still need more funds to make this idea a reality.

A BIG THANK YOU TO ALL OF THE GREAT PEOPLE BEHIND THESE ORGANIZATIONS!

If you or your business would like to help the orphans of Ukraine, or just be part of a "world's first" project, please visit Ukraine Little League's official website http://www.ukrainebaseball.org/ for more information, which includes a Paypal account for donations. Or you can contact Basil or myself directly.

Here is a video on YouTube about Little League in Ukraine. The footage here was shot several years ago as part of a documentary meant to produced about baseball in Ukraine. However, it was beat out by another, apparently more interesting, subject also being considered at the time.

PLAY BALL!!

Ukraine is an iceberg

A friend of mine just forwarded me The 2008 Ukraine Competitiveness Report published by the World Economic Forum. The section on Ukraine's rankings in the Networked Readiness Index gave me some good statistics. Some of the stats were in line with what I sensed here on the ground, but a couple of them surprised me. My main takeaway was not earthshattering. Basically, it's what I and any other moderately intelligent person whose lived here for any time knows: Ukraine is not living up to its potential, and it's mostly their own (read: government) fault. It's the iceberg phenomenom. Most of its potential lies hidden below the surface.

Below are a few I found most interesting:

• Ukraine's broadband Internet monthly subscription cost, as a percentage of monthly GDP per capita and monthly income ranked as "relatively affordable" among all countries, although Internet usage overall is very low. However, the cost of mobile calls ranks as being "quite high" compared to international standards.

This surprises me given the intense price competition we've experienced between the mobile operators over the past 10 years. Maybe "mobile calls" in this report refers to mobile Internet calls. That I can believe. It would also indicate that there is a lot of untapped growth potential in mobile data services, whenever the operators decide they want to encourage usage. But in the context of this report, it seems there is already a lot of people who want to use the Internet and know how to use it, but don't have a computer or Internet connection available.

• Ukraine's business readiness, or companies' preparedness to fully incorporate ICT into their operations and strategies, came in "mixed". Companies got mediocre marks for the quality of staff training the local availability of research and training services. It was also hurt by affordability of telecommunication services.

This doesn't surprise me, as my impression is that Ukrainian companies have a hard time implementing a complete solution or doing something the right way. I can easily a company paying for a new technology or piece of software and not bothering to figure out how to fully utilize it or even train people how to use properly. This requires strategic thinking, an ability to analyze a process and find a more efficient one, and probably additional expense for training. I'm sure Ukrainian companies aren't unique in this area, but from my experience many are notorious for slapping things together and forgetting about them.

• Ukraine had a "rather large difference" in scores between business and individual ICT usage, with business usage scoring much higher. However, in terms of global rankings, Ukraine's individual usage ranks higher, suggesting that Ukraine's businesses are losing competitiveness against the international business community.

This is more of an outcome statistic for me, that shows how the ICT weaknesses of Ukraine's businesses are hurting the ability to compete with the rest of the world. It's causing them to lose ground. It also indicates to me the huge ICT potential of the Ukrainian population that is yet to be tapped.

• Ukrainian firms are perceived as "not very successful in absorbing technology". But Ukrainian firms' innovation capacity ranked "quite high", which bodes well for the country's future preparedness.

A general statement, but, like the above stat effective at revealing Ukraine's ICT potential.

A grim reminder of Ukraine's challenges

The above is a grim reminder of the challenges Ukraine and its citizens still must deal with as it moves from a centrally-planned authoritarian regime through mafia-style politics on its way to stable democracy. The flowers were laid on a sidewalk in downtown Kyiv in memory of the head of Ukraine's National Academy of Sciences, who was gunned down in an apparent contract hit about a couple of weeks ago. This shooting happened across the street from an expat friend of mine, and in front of the building where a US Embassy employee lives. It's about 3 blocks from my apartment.

I can find no mention of the incident in the English-language Internet. But I heard from a Ukrainian doctor friend that there has recently been a large restructuring of the health care system between the Ministry of Health and the Academy. I've heard the Academy has one of the largest, if not the largest, budget of any ministry in Ukraine. And like all parts of the government, corruption is rampant.

I don't know why this person was killed, but it doesn't really matter. What matters is that there are obviously still at least one too many Ukrainians who believe killing people is the best way to get what you want. I know it happens in every country. Contract hits in Ukraine don't happen nearly as often as they did 15 years ago, or as often as in Russia today. But as an American, it is still pretty scary to think this kind of thing happens on a public street in the heart of downtown.

Boosting Ukraine's market efficiency with e-commerce

A former colleague of mine at Sonopia in Ukraine, Vasily Burov, just launched a new e-commerce site called ВСЕАВТО (trans. All Cars) for people looking to buy or sell their cars. Vasily is a bright, entrepreneurial guy who earlier created and sold one of the most popular consumer websites for "everything mobile" called Мабила.

While websites like this launched in more developed markets years ago, this is something innovative for Ukraine. I've never had to buy or sell a car here, I know that overall market efficiency in Ukraine is extremely low. Unfortunately, Internet penetration is also low. No more than 10% of the population has access, let alone know what to use it for. However, Internet usage is growing rapidly as is broadband access. I'm interested to know if he plans to create a mobile version? Mobile penetration, of course, is much higher - around 70% of the population - and I'd say at least half of the mobile devices can access the Internet.

E-commerce, m-commerce and online marketing are still in their infancy in Ukraine, but the affluent and younger generation of Ukrainians are tech-hungry and tech-savvy so I think we're going to see a lot happening in these areas over the next 5 years.

Marketing in Ukraine: liars and bridges

Futurelab's Marketing & Strategy Innovation Blog recently had a thought-provoking post about the connection between customer experience and marketing. It resonated with me for a few reasons. One, it challenges marketing professionals to choose who they want to be:

"... liars spinning fabrications around inferior products and services who depend on traditional marketing to make themselves appear more appealing. Or, we can be honest, and figure how to actually make the product, service, and brand better - so marketing initiatives will become a natural extension of the experience a customer has with that brand."

I think most marketers who want to choose Door #2, they find themselves at odds with bosses, companies or clients who have either chosen Door #1 or apologetically say "that's all we have to work with right now". In Ukraine it is even more difficult because marketing is still mostly equated with advertising, PR or sales, all of which are very much seen as ways to gloss over product shortcomings. Thinking of marketing as a bridge between the product/service and driving customer satisfaction/experience is still years away for most companies in Ukraine. Generations of Ukraine's citizens have been lied to by their politicians, employers, and each other. Not just little white lies, big lies. So skepticism and mistrust is built into the society's psyche. Despite this, Ukrainians generally have high expectations for whatever they buy and are disappointed easily. Therefore, Ukrainian consumers do not give their trust to a brand easily. It is easily broken once it is broken it is extremely difficult to get it back.

To date, the only protection for brands that lie and disappoint customers has been Ukrainians' low incomes and lack of alternative. Both of these problems are improving quickly. Those companies who now truly understand their customers and are looking to meet their needs in novel and innovative ways will see their market shares grow tremendously. These are the companies who leverage the power of marketing and its strategic role in product development and communication to Ukrainian consumers. They regularly track customer satisfaction as their primary benchmark for success and use it as a driver for product and service innovation.

I'll leave you with an example from a few years ago which demonstrates the lack of marketing sophistication in this part of the world. The example is from Moscow, but the situation isn't much better in Ukraine. The photo to the left is for a company selling apartments. And based on outrageous Moscow real estate prices, they probably cost at least several hundred thousand dollars. The offer reads "Super Promotion! Buy an apartment and get a free baseball cap!" Need I say more?

Ukraine social commentary through art

In Shevchenko Park yesterday there was advertised the Festival of Ukrainian Cartoons. A long line of satirical cartoons about Ukrainian politics, business, society and culture were along the the ground. Ukrainians can have a very dry and dark sense of humor about Ukraine's past and current challenges, problems and shortcomings. But they are also very insightful, creative and funny.

I snapped some photos of the cartoons which I thought were clever and clearly communictated their message. Of course, this is from a foreign, albeit well-informed, perspective. The ones I chose address issues like corruption, Ukraine's future, media freedom, and the artist's opinion about the intelligence of Ukraine's leadership. I think this kind of creativity is not something most people see coming out of Ukraine, and to me illustrate more of Ukraine's vast untapped potential.

Steve Ballmer of Microsoft visits Kyiv, Ukraine

Yesterday I took the opportunity to hear Steve Ballmer, CEO of Microsoft, address a select group of Microsoft's partners and customers in Ukraine. The vist was part of his whirlwind tour of Central & Eastern Europe. His tour got off to a somewhat messy start in Budapest, with a disgruntled student -probably a Mac user :-) - hurling a few eggs at him.

Ballmer made no major announcements, unless you count offering to send the 14-year-old son of a Kyiv businessman a free Xbox game. It was a "thank you" in return for the boy's question (conveyed by his father to Mr. Ballmer) as to why Microsoft charges for some Xbox content that Sony's Playstation provides for free.

He received several questions regarding Microsoft's plans to open an R&D center in Ukraine, to which he made no commitment, saying that where Microsoft open centers is driven by 1.) adopting them through acquisitions; 2.) the quality of a country's university system; 3.) the country's education system to churn out LOTS of math, science and computer graduates. Although it appears that Microsoft plans to open an Innovation Center at Taras Shevchenko University in Kyiv.

Ballmer came to CEE to highlight the fact that is Microsoft's fastest growing region - even bigger than China - and it's importance to the company. Microsoft is facing even more stiff competition in its developed markets from Google, Apple and RIM particularly in mobile devices like MP3 players and smartphones. Microsoft, like elsewhere, is still the dominate player in business and desktop software in Ukraine but, here too, it is coming under increasing competitive pressure. Although anecdotal, I think Apple is catching more Ukrainians' attention, both in the computer and mobile device market, due to the iPhone.

My feeling was supported today when I saw this sign over over a shop in Kyiv's main street, Khreshatyk. This sign must have gone up in the past month or so. The funny thing is that the iPhone isn't officially offered in Ukraine yet, but many of the devices have been brought in and hacked illegally. Apparently supply is ample enough for this shop to advertise tech support for them openly.

That said, while I give Apple credit for being the first to introduce a very cool touch navigation user interface and sleek, attractive device, I think 1.) the hype is fading quickly, and 2.) competitors, including those running Windows Mobile, are quickly introducing their own touch devices. I think Apple once again was on the cutting edge of innovation, but the iPhone's market share growth will quickly slow and likely decrease unless it really gets serious about being in the phone business.

And the friend with whom I attended the Ballmer talk said that her company is switching to Blackberry, even though they will have to switch mobile operators and phone numbers to do so. Why not switch to devices running Windows Mobile?

But, unfortunately, the thing that stuck most with me about Ballmer's talk was his reference to Ukraine as "the Ukraine", which is like nails across a chalkboard to most Ukrainians. And he said it about 20 times during his hour speech. Its a language and cultural subtly that is a common mistake by foreigners, but by putting "the" in front of the country's name indicates that it is a region of another country (i.e. Russia) and not an independent country. Russia still calls Ukraine's statehood into question today, so it still very much a live issue here. Someone should have briefed Mr. Ballmer about this prior to his talk.

A more minor and entertaining faux pas was when Ballmer, as many of we Americans do, finished a couple of sentences with "blah blah blah". Phoenetically, that word means "whore" in the Ukrainian and Russian languages. Difficult to warn someone about that one.

Trends in advertising creative and the telco business

A great article on ADOTAS about creative development in advertising agencies.

Based on my experience with Euro RSCG Kiev, I think Mosteller's list of desirable skills for today's creative department are particularly important for agencies in markets in transition like Ukraine, where society and cultural norms are undergoing tumultuous change, and the first generations of Internet users are growing quickly. Consumers' desired relationships with brands heavily impact how the brand should engage them if it wants to connect with them. Analyzing, understanding and explaining these trends are crucial to keeping clients' advertising and brands on the cutting edge. These skills are not only needed for digital media, but for the traditional channels as well.

My experience with web marketing at Sonopia, in comparison with my previous work in traditional media channels with Euro RSCG, highlighted to me the difference creative development approach for each. One difference is the freedom to employ a "test and learn" approach to constantly fine tune creative to improve click-through and conversion rates. This requires the creative team to take a more modular approach to each webpage and have a greater appreciation for performance measurement and analysis (from strategy guys like myself). This may sound trivial, but many agency creative types (usually lower level ones) naturally prefer to consider themselves more artists than salesmen, and resist seeing their ideas modified just to meet some stupid performance metrics. The slower and less precise traditional channels insulated them somewhat from these compromises.

If you're a "creative type" in an agency, what do you think?

Telco 2.0
A couple of thought-provoking articles and polls about the future of the telecom operator business from the guys at Telco 2.0. I like these guys because, whether you agree with them or not, they consistently present new ideas and business models for telecom operators from a money-making and customer-driven perspective.

"The line forms in the back, lady." - Kyiv, Ukraine

In the past two days I've again experienced the Ukrainian queuing culture that is quite foreign to we Americans. Today it happened to me at a bus stop. Yesterday at the bank. It is the practice of one entering a line, and then proceeding ask the person in front of or behind you to save your place while you go run your other errands or have a cup of coffee. It's great for that person, but I find it quite rude to the others patiently waiting in line and especially to those whom you've put in the position of defending your place in line to all those people who arrive in line after you've gone and come back. I'm sure we all can understand, when in a big hurry, the joy of entering a bank and seeing that you're #3 in line, then the subsequent frustration of excruciatingly slow service while 4 more people one-by-one step in front of you claiming that the persons in front of them saved their place in line.

I've run into this practice many times since living in Ukraine. I believe it's a holdover mentality from the days when goods were scarce and people had to wait in line for a day just to buy bare essentials. You have to "multi-task" to keep your family fed and clothed before midnight each day. And in those days no one was in a particular hurry. They were either unemployed or not getting paid, so who cares if they wait for 3 or 30 minutes. But those days are long over. Shelves are full in most shops. People are working long hours - and getting paid. The value of their time is becoming more dear. Sound familiar, my fellow Americans?

So I think this practice will eventually die out. But I think it could be helped along a bit. First, people have to feel societal pressure not to do this. I can see by many people's reaction, that they don't like this practice either, but usually keep silent or agree to save a place to avoid appearing petty. But I, as politely as possible, usually point out the rudeness of this practice when it happens to me, and (politely) refuse to save places in line. The times I've done this, the look on the person's face seems to tell me that they, too, realize they are asking for too big of a favor.

Second, customer-facing workers in companies (pharmacists, bank tellers, ticket sellers, fast food order takers) need to exercise better line control. It could be as easy as posting a sign asking people not to save places in line, thereby lifting the responsibility for education from the customer. They can also be more assertive in serving people as they come to the window. For example, once in a pharmacy I was next in line after waiting about 15 minutes when the guy waiting behind decides he's tired of waiting and just walks around me and places his order. The pharmacist said nothing and began to fill his order until I stepped in.

Anyway, not one of life's major issues but something that, if resolved, could remove one of the miriad anxieties and stresses people must deal with on a daily basis. I also believe that any business that introduces "effective queue management" techniques, will find a more satisfied customer.

What do you think?

What is this blog? Take 2...

Well, my first post of this, my second attempt at starting a blog, has gotten off to an inauspicious start. After spending a few hours on a carefully-worded introduction, Blogger.com abruptly deleted my draft before I finished. Ironically, this kind of thing is one of the topics I plan to address in my blog: user/customer experiences. In this case, a bad one. What makes it worse is that the help forum shows that this has been a problem for at least a year and hasn't been fixed. The amount of negative energy, lost ideas, and forgotten creative turns of phrase over that time must be huge. And for a person for whom it's taken a few years to get up the gumption to start a blog because it takes so much time and mind power, it makes me again question my decision to start one.

Anyway, I'm not really a negative person, so don't think this blog will be regular rant about what's wrong with everything. On the contrary, I plan to include observations, insights and ideas about cool, funny, sad and maybe even helpful things from different aspects of life: society, culture, business, politics.

This is a very broad list of topics, but there will probably be a few common threads and themes in all of my posts:

Ukraine and the US: I am American and live in Ukraine.

Telecom/Tech marketing: Pretty much my entire career has been in this area, so I tend to see things through this prism.

Customer/User experience: From a business improvement perspective but also my personal perspective as a customer and user.

In case you're wondering, my blog name comes from Ralph Waldo Emerson's essay, Self Reliance, which I first read in high school and which has stayed with me since then:

"A man should learn to detect and watch that gleam of light which flashes across his mind from within, more than the lustre of the firmament of bards and sages... Else, tomorrow a stranger will say with masterly good sense precisely what we have thought and felt all the time, and we shall be forced to take with shame our own opinion from another."

Some of the gleams you read here may be dim and small, but hopefully there will also be a few that are big and bright. In that spirit, I encourage you to leave your own gleams that may flash across your mind as you read this blog.