Why the Commonwealth Bank of Australia Opened Up to Customers about Credit Card Risks

In August 2017, Commonwealth Bank of Australia was looking for ways to differentiate itself from competing banks and was also trying to improve the financial well-being of its customers. One area where this was particularly relevant was in its bank-issued credit card business, where customers routinely selected cards that — although profitable for the bank — could be a poor fit for their needs. This led to low customer satisfaction scores, cancellations, and occasionally, financial distress. The bank decided to experiment: Rather than just presenting the strengths of its various credit card offerings, they proposed also promoting each credit card’s drawbacks. Being transparent with customers might help them make better choices, but would those choices come at the expense of bank performance? Harvard Business School Professor Leslie John joins Brian Kenny to discuss the case, “Commonwealth Bank of Australia: Unbanklike Experimentation” and ideas related to her new book, Revealing: The Underrated Power of Oversharing. They explore the benefits and potential drawbacks to the bank “oversharing” information with customers.