Amazon Advice is coming to a screen near you.
It is already happening.
Wesfarmers recently bought a large telehealth business – Instantscripts – for $135m.
This purchase was in addition to the company’s $1B acquisition of the Priceline Pharmacy chain last year.
Not to be beaten by their smaller competitor, Woolworths is building up HealthlyLife Pharmacy, which provides e-consultation, e-scripts and medicines.
If this trend continues, I might be able to pick up some cheap statin next time there’s a special on printer ink and paper at Officeworks. One day I might also be able to squeeze an eye test, an x-ray of my bung knee, a dental check-up and an eye test at one convenient location.
Think of the savings.
Advice without examination?
Fragmented health care?
Could unseen corporate KPIs exert soft pressure to influence e-scripts above patient care?
The new health divisions believe they are simplifying an essential industry that has become too expensive, complex and fragmented.
Another tsunami of creative destruction from gigantic distribution groups with promises of better choice and access to affordable ‘good’ products.
This is ‘good advice’ without a sniff of conflict of self-interest or market power.
Is this the health version of ‘good advice’ introduced in the recent Quality of Advice Review?
Time will tell.
One thing is for sure. This is the future.
The giants care about expansion.
They can smell growth.
They know their demographics.
They ‘own’ most games played on affordability and margins.
Their lobbyists are adept at balancing regulatory hurdles, political opportunism, and consumer sentiment.
Food, grog, health, electricity, banking, hardware, or even financial advice. What is sold is less important than how much can be sold and what market share that represents.
The premise is that markets work.
And when they don’t yet work as planned, the giants have built special access to venture capitalists who are willing to fund the market gap until they do.
The forces accelerating the upcoming Amazon Advice (or Wesfarmers Advice, Berkshire Hathaway Advice, China Life Advice, Aussie Super Advice) to a screen near us are powered by deep pockets, generative AI, huge market gaps and growth fears built upon a belief that “…if you snooze you lose”.
Wesfarmers and Woolworths are displaying the textbook approach to recessions – these are the best of times for cash-rich giants to create, buy, and build future capability platforms.
They aren’t the only ones.
What are the consequences of a predicted rise and rise of “Amazon Advice”?
Bigger isn’t better – better is better.
There is a massive difference between innovative expansion and distribution expansion.
Replacing the advice distribution models of the last three decades with the most ingenious generative AI platforms, affordable pricing, and a greater range of products can only hope for better long term outcomes for the buyers. Without significant innovation something more than a ‘product’ will be required to maximise the buyer’s probability of better long term outcomes.
That innovation is value, which is less about the features of a product and more about the enduring impact.
While some buyers might care less about the consequences of their advice purchase, most buyers have always and will always seek value for money.
Advice isn’t just another product.
Advice has always been about impact, consequences and value.
It is a dangerous market space for any firm that mistakes this.
What do you reckon?
Photo credit: shutterstock_57108277
ABOUT JIM STACKPOOL
For over 30 years, Jim has influenced, coached, and consulted advisory firms across Australia. He founded a training firm, Certainty Advice Group, to coach, skill and build advisory firms delivering comprehensive, unconflicted advice with fees priced purely on client value. He has grown a solid and collaborative community of advisory firms aligned to his firm’s comprehensive advice model – Certainty Advice – Australia’s only Certification Mark accredited by ACCC and IP Australia for comprehensive financial advice. He presents at conferences, has judged professional advice awards, written industry white papers, chaired practice management curriculums for tertiary institutions, and authored four books on financial advice – his latest – What Price Value – was released in March 2022.