07.02.19 | Royal Commission (and Amazon)

By Jessica Sier 07 February 2019 3 min read

Amazon is an eye-wateringly successful business for a whole host of reasons.

But one of the main ones, one that reflects a wonderful global business shift, is its unwavering focus on delivering value for the folk who buy and sell stuff on Amazon.

It makes its prices the lowest and works hard to make its service the best.

In the past, the generally accepted way to do business was to crank out profits year after year, serve them up glowingly for your shareholders, and wait for that juicy pat on the head with management bonuses and fat share price appreciation.

And the last person who received any kind of nod was the consumer, or the user, or whatever addiction-linked noun that describes the person parting with their dosh in return for a thing or a service.

They were the end of the long supply chain of other parties clipping the ticket.  

But Amazon (and the internet) proved, after a long time sure, that building your entire business around what your customers need and want leads to success. Like real money success.

That is the deep change afoot.

And that’s what this week’s Hayne report slaps across the collective faces of incumbent banking, insurance and superannuation businesses.  

If you’re a business, customers need to come first.

And it’s difficult not to get stroppy at the whole industry, because for the internet generation, that seems pretty obvious.

Of course you should let people know if they’ve got an account with you and they haven’t touched it ten years but you’re still taking fees from them.

Of course you shouldn’t charge people dishonour fees over and over again, when they’ve got no money left in their basic account.

Of course you shouldn’t charge people for financial advice they never asked for, or never got, or look really, that might never have been openly offered to them.

(A clear list of the findings is here.)

How on earth is that showing your customers any kind of respect at all? How on earth did your customers stay with you all this time?

Ah of course! There actually weren’t many places to go!

Now, many of you hard-core libertarian, capitalist free-thinkers will argue, it’s the fault of the owner of the account because they should know what they’re paying for.

And that if you’re asleep at your own wheel and don’t take the time to properly compare and engage with your own finances then you, in your own way, deserve to be duped.

To that I say: How?

Where can I find the fees? Where can I find the fee breakdown? Where can I find the tools to self educate and compare the mass of financial products that exist out there?
The lack of transparency (not to mention the miserable state of financial literacy in Australia) is an enormous impediment.

But, just like Amazon shows a new business culture can work wonders, there are inklings of change.

There are more places to go now. New internet banks are popping up and that’s great.

There are open lines of communication between businesses and people, and that’s great.

If you’re reading this, it’s likely you’ve already taken steps to put yourself through some money education and that is great.

We don’t really expect there to be a seismic shift in how Australia’s largest banks operate. (And neither does the market...bank shares went up the day after the report.)

But we do believe that folks across the country are perking up and thinking about wrestling back control of their own money.

That’s great.

P.S. This header was an anti-piracy ad that ran on Australian-distributed VHS videos in the early 1990s.

Words by
Jessica Sier Right Chevron

Jessica Sier is a financial journalist. Prior to that she led content at Spaceship and was a reporter at the AFR where she discovered that breaking down financial jargon was a public good.

07.02.19 | Royal Commission (and Amazon)