The most talked about company award this week goes to Facebook (FB), thanks to their IPO which launches on the Nasdaq tomorrow. They’ve set the share price range at between $34 and $38 for 421.2 million shares and it’s oversubscribed by as much as 25 times.

But there are those sceptics who say the price can’t be justified as their current earnings of $3.2bn make the whole thing look like a magic trick. The Wall Street Journal indicates that professional investors are selling their holdings as they don’t feel there’s a lot of upside on the pricing. Here’s some thoughts on its strengths/weaknesses:

On the worrying side
Zuckerberg maybe Mr-Down-to-earth, but what if he leaves? Some fear that the company, as valuable as it is, wouldn’t be as good (whatever that definition is) at scaling and providing ROI without him. It’s Apple without Jobs, Virgin without Branson, The Stones without Jagger. Zuck is trusted at the moment to put the company first – he’s turned down small fortunes to fulfill his dream of a connected world. A market capitalisation of $100billion on one pair of shoulders creates risk.

Trends change. Levi jeans were cool, but when an overweight Jeremy Clarkson wears them every day, the 17-year-old with a nose stud would rather drink creosote than be seen in a pair of 501s. The fear here, is that will kids just skip Facebook for ‘the next big thing.’ When your folks, your grandparents and school teacher are on FB, suddenly it doesn’t feel so cool does it? Its popularity may actually hurt it.

Perhaps there’s social media fatigue coming. I don’t buy that entirely, the social genie has well and truly left the lamp. There may be the need for more personal, more friend-orientated platforms and not the ubiquitous, chase-down-your-ex-boyfriend that is FB, but 900 million users aren’t going to stop engaging en mass. MySpace and Friends Reunited may have shriveled but social contact didn’t die with them.

Ads are where the money guys are thinking but if it’s ‘social’ you’re looking for, a raw advert is arguably out of place. These will become largely ignored like the ubiquitous banner, unlike when you’re Googling for something.

That said, they are growing their ad business: $3.2bn last year up from $272mn in 2008, but GM is an A-lister who’s ditching their paid-for ads on FB. One small hole doesn’t sink the ship but will others be looking at jumping due to a poor ROI and a fear of FB’s need to milk them dry and grow revenue?

Mobile is how we prefer our social lives with over 50% of FB’s daily users using mobile for the platform (80% of UK twitter use is via mobile). Unfortunately for Zuck it’s far more difficult to provide mobile ads that don’t infringe on the user experience on the small screen.

Sponsored stories (i.e. another form of paid adverts) are where you vote for something and FB turn that vote (and your profile photo) and posts it out to your friends. They charge for this and believe there’s growth there.

On the plus side
FB get 30% of revenue from gaming and apps. This is definitely set to increase as popularity grows.

Despite their $3.2mn in sales which are heading north (perhaps towards $6bn this year), I somehow can’t believe that’s where their true growth will come from. Facebook is arguably the web’s barometer. As you browse online, they are collecting your every click, even off Facebook. They know what you really like not just what you tell the world you like by clicking the thumb icon.

This is the ultimate PhD study of humans’ digital habits. Big Data is the understatement of the year. This is where their value lies – in data mining on scales never seen before. Not even the credit card companies could come close to matching this jigsaw of contact, profiles, postings, places and likes. It’s the holy grail of connectivity and insight. How much will Big Co pay for that? Will there be a backlash if they do?

The freemium pricing model works because you get to charge some of your power users. What’s stopping FB charging companies in the future for their pages? If you’re so embedded in the platform, they really would have you by the throat when they hit you with a £99 per year service charge. They would need to price the fee at a sweet spot and not scare off too many organizations with pages and hundreds or thousands of fans.

You get money from customers not users. Apple and Amazon have customers (and their credit cards in the system), FB has users. But there’s the huge opportunity here for payments and banking to go through FB as it’s got the unique user base of consumers plus companies. Add trust and brand equity to that and when I’m logged in via my phone and swipe it across the register in Starbucks, or Top Shop, or Sainsbury’s, money from my Facebook bank account could appear in their Facebook banks (along with a ‘like’, of course). Micro payments between individuals become a simple reality. I predict FB buying a company to give them a jump-start in this space and offering a huge convenience for its users (not the companies trying to sell to those users) whilst clocking up small commissions.

Honestly, I have no real idea about pricing shares but FB looks set to rise initially as the frenzy takes hold. But Zuck is going to have to push development heavily to innovate and generate revenue streams in areas as yet untapped and justify the price.

Side note worth remembering:
When the telephone was introduced in 1876, a Western Union internal memo noted: “This ‘telephone’ has too many shortcomings to be seriously considered as a means of communication. The device is of no value to us.“

I love to talk about social media with enthusiasts of the game. How they’re practising it, where they see the benefits, where will it be in a year or so’s time. But I see more and more so-called specialists coming into the market where they sell their (apparent) expertise to businesses that either don’t have the time or the wherewithal to handle social media themselves.

I’m certainly not criticising SMEs sourcing some talented help, I’m saying be careful what help you’re canvassing. Too may of these marketing experts are one-trick ponies. They sell digital, or marketing but it’s often just social media and nowt much else.

One of my favourite quotes about social media is from Avinash Kaushik, and goes, “Social media is like teen sex. Everyone wants to do it. No one actually knows how. When finally done, there is surprise its not better.”

As a consultant, just going on and on about Facebook or Twitter to a small business that needs marketing, wider business support and outside intuition is like telling a restaurateur that they need to focus, focus and focus yet more on dessert. Okay, it’s fair dinkum for a restaurant manager/owner to spend time and resource on desserts. Yet she also needs to look at the HR side of the business, of finance and infrastructure, of supply and sales, of quality and of appearance. The amount of various business tasks and facets mean dessert is probably less than 2% of their agenda, even if you are a Heston Blumenthal.

So it becomes a question of resources (isn’t it always in business). Yes, I’ll invest in dessert but the myriad of other draws will also get their deserved piece of business attention.

If you’re a Facebook or Twitter coach/marketer/consultant I’d argue you could widen your remit and envelop marketing – at least in a digital context. The alternative leaves a pretty narrow menu (unless you can live off dessert).

Photo credit: Corsi

Culture is surely the most nebulous of business concepts. It’s nigh on impossible to quantify accurately and just as difficult to effect. Its perception often looks very different from the reality within.

Steve Jobs’ autobiography pretty much confirms everything we already thought about the much-heralded Apple leader: he was bloody minded, rude, spoilt, obnoxious, argumentative, difficult, exacting, inspirational and perversely brilliant. I’m not sure your average head-hunter would put those attributes together for a great pitch but the semi-volatile culture he fostered (more than once) certainly worked.

Jobs got away with his emotional intelligence hang-ups because his product was first rate and sold, in the main, by the mother load. So instead of being a nasty dilettante, he’s called a visionary and master of artisan.

Greg Smith has spoken out this recently against Goldman Sach’s culture and bravo to him for taking such a whistleblower’s stand. The top execs have clearly fostered a culture of greed and a “decline in the firm’s moral fiber” at the detriment of wider business aspects.

The head of Tesco UK, Richard Brasher, arguably resigned because of Tesco’s culture. Their sales and market share have slid over recent years but their culture is that of trouncing the competition and nothing else will do. So chief exec, Philip Clarke is stepping across and Brasher had nowhere to go inside the retailer.

Sport constantly demonstrates cultural leadership too. Roman Abramovich is seeking his eighth manager in as many years as the owner of Chelsea Football Club. This isn’t the result of a broader strategy or tactics. At its core this is about Abramovich’s culture – be number 1 or go, immediately.

It’s not just the leaders who dictate the culture. That would be too easy. Everyone in the organisation contributes towards its culture. George Bush didn’t go to war on his own, his cabinet and senior teams went along for the ride too.

Given this is every bit as much about what we do as well as what we say, what are you doing for the culture of your organisation? Perhaps, more importantly: is it enough?

There’s no question that many supply chains are shrinking as manufacturers can become retailers, and retailers can increasingly become manufacturers.

Plenty of retail sectors are feeling these waves in their ponds. It strikes me that cross-pollinating, and horizontal and vertical integration sound wonderfully simple growth strategies on paper, but in reality they involve emotion, history and entrenchment.

The established practices and incumbents are going to feel pain. It’s going to cause conflict as the status quo flexes. These can have an impact on your business and industry for years to come.

Distributors, the traditional middlemen who import brands and then sell from within their geographies, are extending arms to either side of the isle. In a case of striking first, they find themselves fearful that the brands they’ve nurtured through adolescence might well cut them out of the loop and run a B2C direct model, so they look to counter that risk and start their own product or run rebadged white label stuff.

As such, the simplicity of integration is putting a dampener on the overused business term of ‘partnership.’

Take the Apple-Samsung example. Samsung are a manufacturer, making components for many tech brands we love, as well as selling their own kit B2C. Apple is suing them (constantly it seems) for patent infringement of both design and UX.

While they’re slugging things out in court for some very big decisions, Apple are investing in Samsung’s chip-making plant in Texas.

These ‘partners’ and many others in the tech world will be friendly suing one another for decades.

Image credit here.

Google’s free websites are great for the micro business out there who’s not online at all.

They’re going to hurt those digital firms who’ve built a consultancy around helping getting such SMEs online. Well, putting a positive spin on it, perhaps it’ll just put more fish in the digital pond and those newbies may get the tech for free but they’ll still need some advice. So perhaps it’s win-win there.

Regardless of the consultants’ living, anything that presses the reverse thrusters on the black hole of data that’s eking itself into Facebook is a good thing. Surely we want to keep the web as a web, not the web or Facebook’s version. Why so many brands are desperate to house themselves in this ecosystem is beyond me. Yes, they may increase the rate of ‘likes’ but, really, is it worth the wholehearted subjugation to FB to do so?

It’s neutering the offering. Its like selling your house and instead of creating a website or listing a dozen photos and descriptions with your local estate agents, you follow the (theoretical) trend of printing 100,000 flyers in A5. Handing those out on a busy high street means you’ve arguably touched more prospective buyers, but your quality, relevancy, flexibility and depth of content has plummeted.

If you’re a one-man-band-come-micro-business then by all means jump on Twitter and yes, get yourself a Facebook page. But get yourself a website too: it’ll be your hub, your touchstone for everything online. You own and control that completely. Your social media efforts can then compliment that – they DON’T replace it.

So if you’re starting from zero, get yourself over to Google’s free offering and you’ll be in the world of publishing your own content in no time.

I went to a very mediocre business event recently that sold itself as, “A fast-paced, cutting-edge day, tailored to the needs of SMEs.” It was more like a school leaver’s guide to the Internet, at least, that was, until the final talk of the day.

They’d clearly saved the best until last as Penny Power came to the stage and silenced the theatre. She’s the founder of Ecademy.

Penny spoke of her passion for the Internet and how it’d enabled her to run her business from home whilst looking after her children. She listed plenty of personal new found gains and how she can now remain in touch with all her contacts until the day she dies (thanks to social media).

But what struck me most about her business roundup was how she categorised business leaders. People often say there are two types of people in the world, and they’re usually trying to narrow your thinking towards their central argument. As such it’s where I tend to switch off a little. But Penny’s take was refreshingly genuine:

a) the business change maker – is not content with the status quo, have an urge to do something and simply have to scratch it, find it impossible to conform when you know there’s a bigger or better way of things

b) the business trader – buy it, add a mark up and sell it. Find your suspect, prospect and then customer, then find more. Repeat.

If you could subscribe to this polarisation for a moment, which are you, the change maker or the trader? Are you on the side of the coin you want to be?

When someone is in need of a gardener (or a dentist, or plumber, or hair dresser…) and finds a competent practitioner for that role, at a reasonable cost, they tend to stay with that person or organisation for their future needs.

Providing cost doesn’t inflate massively or become prohibitive for other reasons (like losing your job) then things are set – AA Gardening can continue their gig, and Acme Hairdressing will get your business next month. If the service is good and the price is acceptable, why would you go elsewhere? Changing would only risk an inferior service and the added hassle of breaking new ground, so why do it to yourself?

I’m stretching a simple analogy, but is your service that of a competent gardener? It strikes me that we might want to reiterate this more often to our teams.

A former chairman of Marks & Spencer observed, “Customers are not loyal nor should they be. We have to earn their loyalty every day.”

The first email I read in the day is Chris Brogan’s and it’s usually before breakfast. He’s very revealing in a business sense and within that honesty you’ll often find gems of practical advice. His advice can be a little left field as he expounds about far more than just marketing per se by getting into some life and well-being thoughts, but it’s all very well received.

He wrote recently, Doing the Work is Sexy. From it, “I was an owner long before I was the boss. I owned my desk at my telephone company job, and that got me better opportunities, because I owned everything I could and make it my responsibility to do even more than the role required on paper. When I moved to my wireless telecom roles, I owned every one of them. I worked harder on projects that weren’t my assigned work while completing the job they paid me for as well.” This hit me squarely between the eyes.

I’ve been trying to articulate ‘ownership’ to my teams for over a decade with varying success. It’s surely the perennial problem of having others take responsibility for their world at work.

Owning and being responsible for projects, tasks, duties, etc means digging in and not pushing things back onto others. It’s seeing things through rather than dreaming up reasons and excuses why they didn’t float. It’s a buck-stops-here mentality, even though you may be well down the pecking order of the organisation chart.

Saying, “this is above my pay grade,” isn’t taking ownership. Neither are, “I don’t know why I didn’t complete X,” or, “sorry, I simply forgot,” or, “I never seem to find the time.”

The noun manager implies even more ownership. So synonymous is the relationship that you could actually switch job titles from Manager of X to Owner of X, but that would invoke a HR heart attack.

From what I’ve observed I’d say ownership is a mindset, albeit a difficult one to sustain. It comes at a personal cost as you invest more of yourself than your raw job description prescribes. Too few are willing to shoulder the commitment and resilience that owning your role demands. Yet, without blind luck and stumbling on good fortune, only through ownership can you ever become the boss. They go hand in hand, with ownership the first to be outstretched.

Side note:
Heston Blumenthal worked 120+ hours a week for 5 years. He took himself and his one employee to a huge team of chefs and three Michelin stars. He went from self-taught nobody to being mentioned in more or less every good restaurant guide in the world. That’s an awful lot of ownership.

The biggest news in tech this week is that Yahoo! finally appointed a replacement for their known-to-swear-a-lot and former top-dog, Carol Bartz. They’ve appointed little-known Scott Thompson from PayPal.

But the much more fun/entertaining/frightening tech news is Rupert Murdoch joined Twitter. Really joined. No spoof account (that was his wife’s). No digital sidekick thumbing his tweets. No pseudonyms, social media gurus or ghost writers, just 100% unfettered, real-time access to our Rupes.

Love him or loath him (okay, I can probably guess which), this had to make the news wires. He started up on New Year’s eve and quickly courted controversy with (now deleted) quips like, “Maybe Brits have too many holidays for broke country!”

John Prescott must’ve found a dose of irony in a belated Christmas cracker and tweeted, “Welcome to Twitter…@rupertmurdoch. I’ve left you a Happy New Year message on my voicemail!”

It’s oh so easy to mock from the sidelines. Social media invented the term snark – and then used it in abundance. But this has got the hallmarks of a Charlie Sheenesque car crash all over it.

He’s obviously got every right to join the Twitterati but what’s his motivation here? I’ll show them all I’m not an evil bugger? I’ll prove to the world I’ve still got all my marbles? He’s not exactly in need of headlines, or a wider network.

Some are indicating he’s promoting his own products by saying “Great oped inWSJ today,” and “Very proud of fox team who made this great film,” and “Got to watch Foxnews at 5 EST.” Sure they’re all in his portfolio but his marketing teams would have to be pretty desperate to script that!

No, I think his top execs will all be frantically dreaming up ‘seriously pressing business emergencies’ that need his urgent and full attention. And his PR and comms teams will be praying Twitter falls over every 20 minutes like it used to in the early days.

In their shoes, I’d be tempted to sneak one of those Hollywood-style, CIA speced wi-fi blockers into his briefcase… or break his thumbs.

Given his opening salvo, it’s more than difficult to see this going well. I think it’ll end in either:
a) a fizzle, as Mr M gets bored of trying to be fab in 140 characters and lets the account doze off, or
b) in the furore of a NoTW closure but without the job losses.

Amazon in America is offering $5 off a purchase if the user orders via their mobile app. As of Saturday, if you go to Macy’s or Toys R Us and physically scan an item’s barcode with the Amazon App, Amazon will give you up to $5 off that item if you add it to your (mobile) cart and leave Macy’s empty handed.

This is about as aggressive as business gets: if you walk into a competing retailer, scan the very item they’ve spent money on to put in store, we’ll do you a better deal today. Does pricing get any more predatory? Amazon don’t want to be a major retail player online, they want to be the retail player, period. eBay and Google can play around with physical pop up shops, but not Amazon. They know where their expertise lie: online. And they aren’t shy about getting you there either.

It’s yet another stunning lesson from Bezos of using market-leader advantage to further leverage your position. The banks are claiming “Caveat emptor,” or buyers beware, as a retort to the mis-selling and exploitation critique. I can’t help but think Amazon will be saying, ‘sellers beware,’ in the coming years as they turn retailers’ own guns back on them having mined the data to within an inch of its life.