Charles Schwab Customer Focused E-Business Strategy (Page 2)

Abstract

This case discusses the customer-focused e-business strategy of Charles Schwab & Company (Schwab), the leading discount brokerage firm in the US. It describes its multi-channel strategy that aimed at providing the customers as many channels as possible to interact and transact with Schwab. It examines the way in which Schwab focused on providing better customer service by promoting its website and proactively using Internet enabled technologies. The benefits Schwab derived from its e-business strategy are also highlighted.

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INTRODUCTION contd...

The appropriate integration of these channels played a major role in Schwab's success in the discount brokerage industry (Refer Exhibit II for the growth of Schwab's customer accounts, customer assets and number of branches between 1993 and February 2004). Appreciating Schwab's efforts, David K. Pecaut, an e-business expert said, "By integrating the online and offline worlds, Schwab has become the benchmark for others going online."

BACKGROUND NOTE

Later, he tried selling life insurance policies. Finally, Charles decided to make a career in the stock market. In the 1960s, he set up a company called First Commander Corporation, which managed investments and published a newsletter. However, Charles was forced to close the company down for having failed to register with the SEC . In 1971, he established Charles Schwab & Company (Schwab).

After SEC banned fixed commissions on May 01, 1971, Schwab pioneered the concept of discount brokerage. It provided no-frills transaction services to customers who made their own investment decisions. Its revenues grew 30- fold from $4.6 mn in 1976 to $126 mn in 1983. In 1987, Schwab came out with an initial public offering (IPO). ....

        Case Code   ITSY042
   Case Length    18 Pages
              Period    1997-2004
 Organization     Charles Schwab
        Pub Date     2004
Teaching Note    Not Available
     Countries    US
      Industry    Financial Services

Issues

This case is structured in a way so as to enable students to:

Understand the importance of a customer-focused e-business strategy for the growth of an organization.

Appreciate the importance of a multi-channel strategy in providing better customer service.

Recognize the role of IT/Internet in integrating different business processes to make them more customer-oriented.

Identify the ways in which IT and the Internet can be effectively used for enhancing customer satisfaction levels and thereby improving the financial performance of the company.

Charles Schwab, E-Business Strategy, Customer Relationship Management, eCRM, Multi-channel Strategy, Channel Integration, Customer Segmentation, Implementing E-Business, Website Enhancement, Personalization, Positions Monitor, Schwab Alerts, Learning Center and Personal Choice Program.

Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.