Why The Lack Of Competition In Australia Is Basically Bad News For Everybody

Why The Lack Of Competition In Australia Is Basically Bad News For Everybody
SHARE
THIS



in this opinion piece Jess Ross (pictured below), managing director of Sydney-based digital design studio Wilson Fletcher, argues a distinct lack of competition among Australian businesses is leaving them – particularly digitally-speaking – a long way behind their overseas competitors.

It’s a common refrain: “We’re playing catch up”. “Everyone’s scrambling to get to base camp”. “They’re the only ones to have invested in modernising their platform”. Whether five, eight or 10 years are quoted, it seems Australian businesses universally consider themselves laggards when it comes to digital transformation and the ability to act on opportunities in the digital age.

Screen Shot 2015-09-03 at 2.19.49 PM

This is a curious fact when you consider that Australians are a country of early adopters. We rank seventh in the world in terms of internet access and have one of the highest smartphone penetrations in the world (almost 90 per cent of adults by some measures). It’s fair to say that the vast physical distances that need to be traversed as the world’s only nation/continent gives us more impetus than most to invest in and value digital connectivity.

We also have a long history of invention that has produced (among other strokes of genius) icons of Aussie masculinity and grooming such as the two stroke lawnmower, insect repellant and bank notes you can surf with.

It’s easy to argue that the lack of digital innovation from Australian businesses is down to population density, or distance or internet bandwidth. But there is another answer that’s easy to overlook – a straight lack of competition.

Competition is the tangible evidence of addressable opportunity – new competition much more so. So it’s not a big leap to conclude that the lack of competition in Australia encourages Australian businesses to focus inward and defend existing territory instead of embracing the need to reinvent themselves and looking to the horizon for viable digital opportunities to exploit.

There are examples of the effect of this littered all over the digital economy. Online retail is now 20 years old. But even in 2014, 53 per cent of Australian retailers still had no online sales channel at all. It took UK online retailer ASOS, which was once flying four jumbos full of clothing to Australia every week, to jumpstart Australian fashion e-commerce in 2013.

Similarly, streaming services launched in Australia and the US at roughly the same time (2007-8). But it took the threat of Netflix launching here last year for serious investments to be made in the industry with the launch of Stan (jointly owned by Nine and Fairfax), major marketing pushes by Presto and Quickflix and a price slash by Foxtel.

In the US, 63 of the top 100 companies by revenue are less than 30 years old – companies like Google, Apple, Amazon, Facebook that have built their vast businesses by disrupting the previous generation. Consider the impact, for example, of Amazon, the biggest online store on the planet, on Walmart, the world’s largest retailer of any kind. In 2012, Walmart’s $469bn in revenue dwarfed Amazon’s $61bn. But less than 2 per cent of its sales were online. In 2015 Walmart will spend between $1.2 and $1.5 billion on e-commerce globally and even more on digital transformation across the business to enable it to compete with Amazon. Innovations like drone-based delivery, automated re-ordering and goodness knows what else will follow.

In Australia, 18 of our top 100 companies are less than 30 years old. And, when you exclude superannuation, mining and construction, just three remain – Sonic Healthcare (one of the world’s largest medical diagnostics companies, providing laboratory and radiology services), Origin Energy and Virgin Australia.

Without the disruptive influence of significant young challenger brands, it’s easy to see why Australia’s largest companies have not had the impetus to act on the opportunities presented by the digital age. After all, it’s much easier to defend your existing way of doing business than it is to reinvent yourself for the digital world as Walmart is attempting to do. Australia Post, I’m looking at you.

The lack of competition in Australia is well known. But it’s time Australia recognised that it’s not just consumers who are suffering as a result. Business and our national economy suffers too. In today’s world, the Australian market’s lack of competition is a ticking time bomb making it downright dangerous for a business to ignore ideas, technology and knowhow that are readily available in the free market. Doing so is not sustainable. There is bound to be a bold new challenger and an ensuing customer backlash at some point.

To survive and thrive in the digital age, Australian businesses must embrace the need to reinvent the way they do business, to take a good hard look at the pain points of their customers and to explicitly invest in the things that will drive profitability in the future over those that drive dollars today.

Please login with linkedin to comment

Latest News

Western Australia Gets Its First Influencer Marketing Agency
  • Marketing

Western Australia Gets Its First Influencer Marketing Agency

Western Australia’s first dedicated social influencer marketing agency will launch next week to service the state’s new and rapidly growing digital industry. The Influencer Agency – TIA – brings strategy, accountability and measurement to influencer marketing for WA brands using WA influencers. TIA will also assist influencers wanting to grow their brand by developing new […]

One-on-one With Marie Claire Editor Nicky Briger
  • Media

One-on-one With Marie Claire Editor Nicky Briger

Following the launch of the revamped marieclaire.com.au, editor Nicky Briger spoke to Magazine Networks about all it can offer readers. In September, Pacific Magazines unveiled an all-new digital experience for Marie Claire. Led by design thinking, the new look marieclaire.com.au was crafted to provide a better reader experience across all devices. It’s a testament to […]

Women’s Health Unveils Its New Premium Digital Experience
  • Media

Women’s Health Unveils Its New Premium Digital Experience

Pac Mags’ Women’s Health has unveiled an all-new premium digital experience. With a faster, cleaner, more intuitive and visually consistent brand experience across all devices, the new look is designed to optimise the user’s journey with less clutter, discoverable content and seamless integration for commercial partners. Will Everitt, head of product and technology said: “The digital evolution of […]

Digital Agency Inlight Secures Two Key Client Wins
  • Marketing
  • Technology

Digital Agency Inlight Secures Two Key Client Wins

Independent agency Inlight has announced it has won the digital account for Benetas, a not-for-profit aged care provider in Victoria. Following a competitive pitch process, Inlight was chosen to handle Benetas’ new website design, build and ongoing optimisation. Richard Barker, marketing manager at Benetas, said: “We wanted an agency that could be our true digital […]

AMI Awards 2017 Winners Revealed!
  • Marketing

AMI Awards 2017 Winners Revealed!

With almost 30 awards handed out, B&T predicts plenty of numb bottoms at last night's AMI Awards in Melbourne.

Clems Sydney CEO Andy Pontin Quits
  • Advertising

Clems Sydney CEO Andy Pontin Quits

Sure, B&T flashed the news of Andy Pontin quitting this morning. White lies aside, he's actually still got six months.

by B&T Magazine

B&T Magazine
Adobe MAXes Most Creatives In A Room Record
  • Advertising
  • Media

Adobe MAXes Most Creatives In A Room Record

B&T's journo is reporting live from the annual Adobe Summit in Vegas. Although, "reporting" is somewhat of a stretch.

Opinion

by David Hovenden

David Hovenden
Digital Women’s Network & The Australian College Of Marketing Unveil Latest Short Courses
  • Marketing

Digital Women’s Network & The Australian College Of Marketing Unveil Latest Short Courses

The Australian College of Marketing is collaborating with the Digital Women’s Network to bring new short courses aimed to provide the latest skills across all aspects of the Digital landscape, kicking off in Melbourne and Sydney in 2018. Course content will focus around various topics related to the digital marketing landscape. All courses will run […]

Man working at office desk, looking at computer and scratching head
  • Technology

Where Are Digital & Tech Skills & Salaries Headed?

The rapid pace of technological change in the digital sector is seeing demand for those with the right skill sets outstrip availability, both locally and globally. The individuals who have kept their skills up to date are being well-rewarded financially. Now, Digital + Technology Collective’s expanded annual Skills and Salary Survey will put some numbers and context […]

Disney & ESPN Unify Sales & Partnerships Teams
  • Advertising
  • Marketing
  • Media

Disney & ESPN Unify Sales & Partnerships Teams

Disney and ESPN have formed an even closer bond, announcing a new alignment of the two properties through their media sales and partnerships teams. Instead of entering through three doors, Disney ESPN Media Sales & Partnerships will give media buyers and marketers a refined, singular point of entry for Disney, ESPN Digital and Maker. Nik […]

by B&T Magazine

B&T Magazine
Sydney Start-up Muzaara Partners With Commission Factory To Turbocharge Digital Ad Spends
  • Advertising
  • Marketing

Sydney Start-up Muzaara Partners With Commission Factory To Turbocharge Digital Ad Spends

Sydney-based adtech start-up Muzaara has announced a new strategic partnership with performance marketing platform Commission Factory. Together, Muzaara and Commision Factory are providing SMEs with a secret weapon to skyrocket their online brand visibility and effectively manage and maximise their online advertising campaigns. This partnership will allow both online marketing companies and their impressive roster […]

Kellogg’s Creates AR Halloween Trick Or Treat Experience Via Shazam & Orchard
  • Campaigns
  • Marketing
  • Technology

Kellogg’s Creates AR Halloween Trick Or Treat Experience Via Shazam & Orchard

Breakfast cereal manufacturer Kellogg’s has joined forces with Shazam and digital agency Orchard to deliver a first-of-its-kind augmented reality (AR) Halloween Trick or Treat experience for families. The campaign, which leverages Shazam’s visual recognition platform and recently-launched AR platform, sees Kellogg’s pilot the replacement of physical gifts in cereal packs with a digital experience that […]

Kraft Heinz Appoints Cummins&Partners As New Creative Agency
  • Advertising

Kraft Heinz Appoints Cummins&Partners As New Creative Agency

Kraft Heinz today confirmed the appointment of Cummins&Partners as its new Creative agency after an extensive pitch process. They will be responsible for brand strategy and integrated creative across the expanding Kraft Heinz portfolio including Kraft, Heinz and Golden Circle. A Kraft Heinz spokesperson said: “After an exhaustive search involving a competitive pitch, we have made […]

Patrick Delany (CEO, Fox Sports), Hugh Marks (CEO, Nine Entertainment Co), Miranda Devine (Columnist, News Corp), Michael Miller (Executive Chairman, News Corp Australasia), Grant Blackley (CEO & Managing Director, Southern Cross Austereo) at Radio Alive 2017
  • Media

Media Bosses Weigh In On Ten-CBS Deal

Do you enjoy articles featuring industry big-wigs? Well, it doesn't come much bigger and wiggier than this, we say.

by B&T Magazine

B&T Magazine
Kantar TNS’ Ali Dexter Joins T Garage As Director Of Insights & Strategy
  • Marketing

Kantar TNS’ Ali Dexter Joins T Garage As Director Of Insights & Strategy

Melbourne-based market research consulting agency T Garage has announced the appointment of Ali Dexter as its director of insights and strategy. Dexter joins T Garage from Kantar TNS, where she was the director of its Qualitative division. Prior to that, Dexter held a number of senior roles at Kantar TNS in the US and Vietnam.  “After […]

XXXX on Tuesday, March 21, 2017, in Las Vegas. (Jeff Bottari/AP Images for Adobe)
  • Advertising

Adobe Releases Advertising Cloud App

Not one, but two Adobe announcements. The tech elves have been busy this week, not that we're inferring Adobe is Santa.