Asia by the Numbers: Part 2

160 years, 2 hours, 2 weeks

Just landed in the Philippines and am relaxing in my hotel before dinner. Hong Kong was a blast. I spoke at a YPO event at the iconic Jockey Club. After the event I played a couple hours of Hold’em with some of the YPO’ers.

The next day was my first off day of the trip and I met up with an old friend, Jennifer Woo. Jennifer is the President of department store Lane Crawford. For lunch, Jennifer took me to the China Club, a private restaurant which serves Hong Kong’s best dim sum. The food was unreal.

After lunch we headed over to Jennifer’s flagship store in the IFC Center. The Lane Crawford experience immediately made me realize why China is starting to kick our ass in so many ways. It felt like I was touring a cross between a fashion museum, ode to reality fashion TV and adult amusement park. The company, 160 years old, is the fashion gateway to China. 

They have built a whole campaign around that 160 years of heritage working with designers to create artistic takes on the iconic trench coat and Ming chair. In both cases the designer’s interpretations are displayed throughout the store. I would show you some photographs but they don’t allow any to be taken.

In addition every detail of the store had been thought out. The layout, the service, the music were all perfect. In fact if you liked the music you could cozy up to the cd bar, make yourself an espresso and listen to more of the same until you found a cd you wanted to buy. (Lane Crawford has a musicologist whose job it is to find fun music to play in the store)

The entire experience of being at Lane Crawford was exactly that, an experience. I contrasted it with my last department store experience in the States. The Bloomingdales’s at Stanford was disheveled and depressing. I don’t remember if they been played music but the moment I walked in I couldn’t wait to get out.

Jennifer left me to shop and before I knew it I had spent two hours exploring the store. I thought about the last time I spent two hours shopping and I realized that it was actually not in person but online. As I reflected on this, I remembered the words of my friend Kevin Compton, owner of the San Jose sharks among many other things. We were talking about how to keep fans coming to games rather than staying at home and watching on their HD televisions. Kevin explained that you simply need to give fans an experience that they can’t get in their living room.

And that is what Lane Crawford has done – they have given the shopper a unique experience impossible to replicate via a website. Every two weeks they make significant changes to the store to make the experience fresh.

There have been rumors that Lane Crawford will be entering the US market soon. I look forward to that day as it might get the people that run Neiman Marcus etc to get off their asses. 

Asia: By the Numbers Part 1

Since I’m supposed to be a numbers guy, as I travel Asia speaking to YPO/WPO and EO chapters, I thought I’d start a blogging series called Asia: By the Numbers.

Status: Currently I’m sitting in the Cathay Pacific Lounge, waiting for my delayed flight to Hong Kong. Last evening, I spoke to the Indonesia chapter of YPO. Great group, although I have to say I may need to update my US pop culture humor references for the international market.

I had been warned to be careful in Jakarta but after reading TripAdvisor, I felt comfortable that those warnings may have been Western media bias. I’m not sure if it made me feel more or less safe when I had to go through a medal detector to get into my hotel. In general, I felt very safe in my brief stint here.

The Numbers – 17,508, 245 M, #4, 30 M, #3, 27 M

In my 24 hours in Indonesia, I learned some fascinating stats. First off, Indonesia is an archipelago consisting of five major islands and 30 more groups of islands. All total, Indonesia contains 17,508 islands. Many of which are uninhabited. Want to buy one? You can.

Indonesia has a population of over 245 M people making it the #4 largest country in the world. Perhaps, this proves my lack of worldliness but before visiting, I would have had no idea that it even fell in the top 10.

Of it’s 245 M, only 30 M are online. Yet Indonesia ranks as the #3 country on Facebook (behind the US and UK) with a whopping 27 M Facebook users. You don’t have to know how to count cards to realize that that means 90% of the people that are online in Indonesia are on Facebook.

Furthermore, Twitter penetration (HR) in Indonesia continues to grow with it currently ranked as the number one Twitter penetrated country in the world. According to comScore, 20.8% of its online users are on Twitter, compared to the average country where only 7.4% of their online users are Tweeting.

An interesting anectodal side note comes from a YPO Indonesia member who commented that many of the younger Indonesians are learning English because of their desire to Tweet.

So what does all of this mean? I’m not sure if I know yet but one thing is certain. As I look for my next opportunity in technology, learning more about Indonesia and potential opportunities there is going to be at the top of my to-do list.

Oden vs. Durant: Let’s Beat the Dead Horse

Recently there’s been a lot written about my point of view that the Portland Trail Blazers should have drafted Kevin Durant NOT Greg Oden in the 2007 NBA Draft. it all stems from my new book where I talk about one of my early encounters with former Blazers GM Kevin Pritchard. Headlines like, “Blazers consultant would not have drafted Greg Oden” and “Blackjack King Jeff Ma saw the NBA’s future in 2007″ highlight my Nostradamus type qualities when using my magical slide rule to evaluate NBA players.

If only I were that smart.

Yes our numbers had Durant rated higher than oden but that is akin to saying Obama’s approval rating is dropping – pretty much a non-story. Durant had a phenomenal college season – one for the ages. Would have been hard for anyone let alone a guy playing with his off hand to top him statistically.

I’ve never approached a reporter or written a blog to highlight my displeasure with the Trail Blazer’s brass for picking Oden. That’s because there is no displeasure. Yes I admit at the time I was “disappointed” that they chose Durant but that isn’t sour grapes harbored for three years, that’s simply an answer to the question, “were you disappointed that they didn’t take Durant?” it’s a pretty natural reaction to have some level of disappointment when a decision goes opposite of what you hoped for. But that disappointment was quickly replaced by hope that my numbers were wrong.

Likewise, the statement, “I would have drafted Durant” is simply an answer to the question, “who would you have drafted?” People ask me all the time in passing – what did your number say – Oden or Durant? And each time I answer with candor that our numbers said durant. If I am giving up some trade secret with that admission I apologize to the Blazers’ organization. 

I have always believed in transparency, especially with bloggers. Ben Golliver was introduced to me through ESPN’s Henry Abbott so I was indeed very candid with Ben. Perhaps too candid. But that is my nature as I don’t believe in hiding facts so long as they don’t compromise competitive advantage. I don’t believe I did that.

It’s hard to know for sure without using the wayback machine but as i recall most people believed that oden should be the first choice that year, yet let’s forget about that right now and say that it was instead 50/50. With such a disparity in production with hindsight as our friend so far we would have 50 percent that were right and 50 that were wrong. I just happen to sit in the 50 percent that “look” correct at this point.

And “being right” here is not a testament that using stats works as much as our lauding of guys like Sean May and Kyle Lowry is not a testament that that stats don’t work.  Like any method the proof is in the results over a long time frame not one individual pick.

I do think Durant would have been the more unconventional choice (which i admit occasional bias towards) simply because Oden was the consensus pick of most experts. If I am wrong on that I apologize for my poor memory.

I have always tried to practice humility in my use of analytics and even within this interview I made a point to marginalize our role in the process for what it was – one of many pieces to the puzzle. And that is my only real issue with the reaction to my statements about Oden, etc. If I sounded like I knew I was right and like I think my crap doesn’t stink then I apologize because that is the worst mistake a numbers guy can make.

Maybe the BCS Isn’t So Bad

As I watched the amazing game last night between the Boise State Broncos and the Virginia Tech Hokies, I couldn’t help but laugh a little inside and relish the fact that our <a href=”http://sports.espn.go.com/ncf/news/story?id=4870657″>President hasn’t yet been able to “throw his weight around”</a> and we still have no playoff system in Division I football.

While bashing the BCS has become a popular and easy pastime – I even attack it in my <a href=”http://amzn.to/houseadvantage”>new book</a> – one thing is clear. The BCS system as it stands makes for an incredibly exciting regular season, unparalleled in any other sport.

Would last night’s game, in doubt until the final 30 seconds, have had nearly the same drama if we all knew that both teams’ national championship hopes would be largely unaffected by a loss? Of course not.

As it stood, this was Boise State’s most important game of the season – a near road game against a top 15 competitor. Already ranked number three in the preseason polls, a win would solidify Boise’s position in the BCS title conversation. A loss would relegate them out of the top 10 and would surely leave them out of the title conversation for the rest of the season.

A must win game in week one.

Contrast this to the NFL season starting in two days. While the anticipation of survivor pools and fantasy leagues adds drama to week one, the fact that Brett Favre contemplated sitting out the first four games of the season, tells you all you need to know about the value of one game in the NFL regular season.

While BCS bashing has become a national past time, games last night should remind us that there is tremendous value to the status quo. Two years ago, I wrote a <a href=”http://citizensports.wordpress.com/2008/12/01/easier-said-than-done-mr-president-elect/”>blog</a> about the complications with a FBS playoff system. To summarize that blog, the ideal and most fair playoff system is unlikely to get approved by the NCAA powers that be and therefore whatever playoff system we get will be flawed so in this of all rare cases maintaining status quo seems fine to me.

I’m already getting excited for Penn State/Alabama next week!!!

Lies, Damned Lies, and Unemployment

In my new book, The House Advantage: Playing the Odds to Win Big in Business, I have a chapter where I discuss how the media uses “statistics” to lie. This is obviously not a novel concept as we know from the following age old Mark Twain quote, “There are lies, damned lies and statistics.”

However, I was reminded of this theme when sitting in as a host on Varney and Company on Fox Business. All you liberals please hold back the boos. This is not a political argument as much as it is a discussion of the dangers that we all face as a country when influential people use numbers to push forward an agenda.

During the 90 minute show, we interviewed John Challenger of Challenger, Gray and Christmas. Challenger’s firm, experts in job placement, had just issued a press release which actually used recent employment statistics to paint a rosy picture of our current job market.

In the release, Challenger’s firm declares that “the job market is well on the road to recovery” citing “bigger trends, which indicate just how much the job market has improved over the last 12 months.”

Challenger asserts, “The statistics indicate that the job market has made great strides over the last 12 months and appears to rebounding sooner compared to the previous two recessions.”

Challenger references a decrease in planned job cut announcements and an increase in payrolls as two such “statistics” that contribute to his rosy picture. In all cases he refers back to previous recessions to draw the conclusion that we are recovering much faster than similar situations in the past.

While it is difficult to debate the statistical veracity of his claims, certainly Challenger does not try to himself, it is important to challenge Challenger from a scientist’s point of view. One of the techniques I espouse in my bookis to not simply accept numbers but instead to think like a scientist and understand the inherent underlying fundamentals.

The heroes of Michael Lewis’ book, The Big Short, literally flew to different regions of the US to see what these mortgages were all about. And that knowledge gave them the confidence to short the housing market.

Similarly if you drive around an area like Orange County, California, as I did last week, during a weekday you see lots of cars in driveways – former success stories in real estate, construction and mortgaging now out of work waiting for the market to turn.

And that is the real challenge with this recession and my gripe with Mr. Challenger’s use of statistics to paint a rosy picture. Where will the jobs come from? Challenger lists health care and energy as two major areas of growth, yet one quarter of the jobs lost in this last recession were construction related and it’s hard to see a construction worker suddenly picking up the skills necessary to work in either of these fields.

The reality is that many of the jobs lost in this recession are not coming back in the near future which may explain why both the democrats and republicans have taken to playing the blame game rather than proposing real solutions – nobody has the answer.

We all know that job creation is the key to turning this thing around but how in the world are we going to do that?