Ruslan Kogan talks about success, social media and entrepreneurship in an interview conducted by Alex Pirouz, founder of business sales and advisory firm RIDC Advisory.
Ruslan Kogan is one of Australia's most visible and colourful business people.
After completing a Bachelor of Business Systems at Monash University, Ruslan had, by the age of 23, worked at the IT departments of Bosch, GE and Telstra, and been a management consultant at Accenture.
He started Kogan in his parents' garage with zero external funding or capital, and has gone on to build a multi-million dollar (and growing) online business, manufacturing and selling consumer and household technology. Kogan is one of the fastest growing companies in Australia, and is now international with the launch of Kogan in the UK in November 2010.
In this Q&A interview with Alex Pirouz, he talks about the elements necessary to be successful in business, the power of social media, and entrepreneurship.
Q: Ruslan, you went from starting a business in your garage to now running a multi-million dollar organisation. Can you share with us what your journey has been like?
A: The growth from my parents' garage in Elsternwick to a multi-national brand has been a tremendous one. It hasn't been without its challenges, but putting my surname on the products meant I had more than just all my savings at stake. Quitting my well-paid job to start Kogan was always a risk, but it paid off.
Q: In your opinion, what has been the most contributing factor to your success?
A: Having the conviction to turn an idea that everyone told me was crazy into an operational business. Lots of people come up with great ideas all the time but not many actually go through with them. When other budding entrepreneurs ask me what the best advice I've ever received is, I always tell them: "Nike has been printing it for years. JUST DO IT!"
Q: What is the hardest thing about launching a company from conception?
A: People talk a lot about finding capital to start their business. If you have a great idea, the money will come from somewhere. The single greatest challenge when turning an idea into a business is having the drive and conviction to do what Nike has been printing on t-shirts for decades: Just Do It.
Q: What was the main reason why you started your own business, was it to make money, change the industry etc?
A: I'm a geek at heart and really wanted to make the latest technology more affordable for everyone. Now that we've done that, it's the competition that gets me out of bed in the morning. I'll never get tired of shaking up the industry and forcing the big brands to try and compete with us on price.
Q: Where do most entrepreneurs go wrong and why?
A: I don't think an entrepreneur can go wrong. If you are an entrepreneur you are someone who has invented a new way of doing business. Even if that business fails, you did actually invent something.
Most people fail because they don't become entrepreneurs in the first place. They might have a great idea, but never turn it into a business.
Q: In your opinion, what is the main reason why most businesses fail?
A: Charles Darwin said it best: "It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change." A lack of innovation and keeping up with their industry is what causes the demise of most businesses.
Q: What has been your most effective marketing tactic or technique?
A: The most effective marketing technique has been building and fostering a loyal online community around the Kogan brand. We have hundreds of thousands of loyal fans around the world that we are in constant conversation with over email, through the Kogan blog, Facebook and Twitter. The most important thing for Kogan is to not only use these communication channels to broadcast or listen, but to actually converse with our customers in meaningful dialogue.
Q: Is there a particular marketing method you believe is the most effective in business nowadays?
A: Any marketing activity where you can accurately measure the return on investment is one worth considering. Too often, companies throw money down the drain with marketing activities when they have no idea how much money they will make from it. At Kogan, we will only ever spend money on marketing if we know for each cent we spend what we will likely make in return.
Q: How has social media, the information age and an increase use of the internet changed the face of how we do business?
A: Social media has done the equivalent of giving every single person in a shopping centre a megaphone. If a customer is unhappy, they'll no longer grumble about it under their breath or just tell their friend. They will tell the world. The same goes for happy customers. For some brands this has resulted in some tremendously negative exposure on social media. Because of our tremendous product and service, the feedback about the Kogan brand on social media has been overwhelmingly positive.
Q: What three pieces of advice would you offer entrepreneurs starting out today?
A: Don't worry if people tell you your idea is crazy. This probably means you're on to something. If your business challenges the status quo, you're more likely to succeed. Just do it. Don't waste time sitting on your idea, because if you do, someone will probably beat you to the punch.
Take risks. Being an entrepreneur is about throwing caution to the wind. I had to quit a well-paid job to start Kogan, much to the dismay of friends and family around me. But taking big risks can pay off. Just ensure they are calculated risks.
Alex Pirouz is the founder of RIDC Advisory Pty Ltd. A Business and Sales Advisory firm partnering with Australia's largest and fastest growing companies to further increase their revenue. Visit www.ridcadvisory.com.au for more details.