Extract from a recent blog by Troy Penney, who works for SuiteBox in Sydney, Australia,
If you and your business are in a profession that charges a fee or a commission for exchange of knowledge, then one of the Gorillas is coming after you….
Here I will tell you why and when.
Facebook, Amazon, Alibaba, Alphabet aka FAAA….k
Never in our history have we had such massive powerful global business units. Never have such business been run as these are, more or less dictatorships. These companies are still all run (for better or worse) by their founders, Believe it, that if one of these founders/owners wants blue to be black then black it goes. Board room meeting yes but everyone would know who is in charge, normally the one that owns the most voting stock/shares….
Quick numbers:
Total market cap of combined $1.9 TRILLION+ $$$
Cash on hand $320 BILLION+ $$$
Borrowing capacity $BILLIONS+
Why they are coming after you? Little ole you…
EASY MONEY!!
Accountants, financial advisers, mortgage aggregators and brokers all charge too much for knowledge that is readily available for (in a lot of instances) free on the popular WWW.
Fact.
Our Gorilla friends can give knowledge to your clients/customers for free. Not only that they can correlate that knowledge specifically targeted for the individual. These tech behemoths can give detailed accurate information based on real live data to place your clients in a better position than you generally can, all in the blink of an eye.
Don’t worry about our fury friends not being able to monetize this “free” knowledge.
They will and can. Their ability to scale a micro payment into hugely profitable business is mind blowing.
This is my pick of the top 4, and why.
Number one big bad boy Gorilla
1) Alibaba, When a company is going to change its self into an economy, you know its big and growing. http://www.thedrum.com/news/2017/07/03/alibaba-transforms-ecommerce-entertainment-it-repositions-the-company-economy Subsidiary Ant Financial is a monster acquiring or eating up cash flow finance business and making new business models in insurance and mortgages and payments with better outcomes for customers and servicers. The ANT is already in Australia thanks to ComBank …..maybe a case for Commonwealth Bank keeping friends close but enemy’s closer. Alibaba is hungry. Very hungry…
2) Amazon The boss, a ex hedge fund manager, knows $$ and how to make it work. A business that used to sell just books then a few years later forks out $billions to buy whole foods ltd (like Coles /Woolworths only bigger) and know that it will do food better than anyone else. Amazon now has the power to just bully people out of a market , Amazon can do this in financial services, on the possible buy out of Capital One the 3rd largest credit card provider in the US . CEO stated that they have the ability to systemise and digitise and better service clients than current company and give possible better rates to customers.
3) Alphabet (Google) knows where you client gets their advice, who gives that advice, Google knows more about your client and their habits and needs than you do. Will they get into payments insurance, offerings lending? Who knows? I bet if they don’t, the data they have will be sold to one of their gorilla friends…
4) FaceBook has already moved into payments P2P via messenger. Within the FB ecosystem lies most of your clients, think about it? How quickly could FB offer Robo advice on, say, the simple transactions and advice you give at a micro payment compared to what you charge? People trust their favorited social brands over you. FB can censor and control, and does, what information flows into your client’s world. If FB says, via clever advertising, that financial advisers charge too much, your business is in big trouble.
A person will delete their adviser before their FB account.
Why are these cloud based service machines not after your clients today?
Lack of people and time.
Time: They are all after the biggest fish first, they have the capacity to go big first.
People: Not enough coders/programmers/ workers – there is a global shortage. This will change over the next 5-10yrs and as the big plays get gobbled up, the smaller businesses / individuals become a better target.
There is no question 5-10yrs out from today the consumer will be paying LOTS less for any accounting/financial/mortgage advice.
Fact.
What to do?
The only point of difference we have is ourselves, face and personality. A chat bot may mirror a personality type best suited to you, so you feel comfortable. However, a real face and person will always be best.
Future proof your business – Within the next period, look at the technology package that gives you the ability to have efficacy when you need it. Find communication/work tools that allow benefits to you and your clients in saving time and travel.
Don’t wait till that day comes when the client says: “I can get that service much cheaper online.” It will be too late at this point to try and negotiate a price if your business is not already prepared.
Tech is your friend not your foe.
This is actually a great article. Very enlightening and very true. I saw on Moneyweb that research shows that it’s not the Millenials that use Robo-Advice but actually people who are older than 45. Meaning technology should be used now to empower your clients and thereby creating effective decision making.
Thanks, Sihle. Very interesting. We often think on behalf of clients, rather than listen to them.