In 2004, the Charles Schwab & Co., Inc. (“Schwab”) was beginning to lose their clients and their position within the brokerage industry. Both the CEO and the Chief Marketing Officer were trying to create a marketing campaign in an effort to restore their brand and market share to what it was in the previous years. This case study discusses the process the company went through to create their marketing campaign, which was appropriately named “Talk to Chuck”, and the results of the marketing campaign.
History of the Company to 2004
Schwab is a brokerage and banking firm that was founded in 1971 by Charles Schwab. The company has always been an industry leader in the area of innovation. The company launched the first self-service brokerage that provided quality service at reasonable prices. They offered seminars to clients to help them better understand what was happening with their investments. In 1983 Schwab was purchased by Bank of America; however, Charles Schwab bought the company back in 1987 and decided to take it public.
With the internet era beginning, Schwab launched its on-line trading website in 1996. It went on offer new products and services to different client segments. The client segments they were catering to included individual investors, independent advisors, and company plan sponsors.
The company reached $1 trillion in assets by 2000 and had over 200 branch offices in 43 states by 2004. In 2003, the company launched the Charles Schwab Bank. Charles Schwab resigned as the CEO of Schwab that same year, only to return a year later. During 2003, the company faced a drop in profit and a decline in revenue from customer stock trading. Schwab’s competitors, Ameritrade and E*Trade, were moving past t...
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In 1850, the Lehman bros. and Richard s. fuld jr. started their business of small buying and selling cotton shop. With the pace of time their business and their ambitions grew up, and opened the Futures trading venture in US. With efforts the firm moved to dealing of commodities with merchant banking. The success of bank was up to at mark.
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The company faces intense competition for the clients that it serves and the products and services it offers. There has been significant consolidation as financial institutions with which the company competes have been acquired by or merged into or acquired other firms. For instance, in November 2010, The Charles Schwab Corporation acquired Windward Investment Management, Inc. for $150 million in cash and stock. In June 2009, TD Ameritrade completed the acquisition of thinkorswim Group Inc. thinkorswim is among the fastest growing online brokerage firms and has unique trading and investor education capabilities, particularly for the fastest growing segment of the industry-options trading. So, this acquisition underscores TD AMERITRADE's position as a successful industry consolidator. Consolidation in discount brokerage industry is creating larger rivals to compete with.
Charles Keating exceeded Mr. Lindner’s expectations, which persuaded Mr. Lindner to extend an offer to the forty-eight year-old lawyer a position with American Financial in 1972 as the executive vice-president. Under Lindner’s supervision at American Financial in the mid-1970’s, Keating found a resourceful strategy to raise money from the public without the interference of the Wall Street underwriters. The success of this strategy resulted from sharp decline in profits that Lindner’s company was experiencing. Keating’s success revolved around him raising fifty million dollars for American Financial from the public without using an underwriting syndicate.
The customer support and customer service functions are more than departments; they are part of an essential strategy for growing your business. In the modern business climate, customers expect answers to their questions immediately. When the right information is available anytime, from anywhere in the world, customers are more likely to have a positive experience, thus customer loyalty will be increased. It is a known fact that the cost to obtain a customer is ten times higher than to maintain and keep existing customers. (Gouran, Dennis, W.E. Wiethoff, & J.A. Doelger. (1994). Mastering communication. 2nd ed. Boston: Allyn and Bacon.) Not in Reference Pg.
In light of an evolving market, faced with new competitors, and after a careful analysis of their current customers, the Vanguard Group (hereinafter referred to as “Vanguard”) realizes it must rethink its entire marketing strategy. However, in order to protect and leverage their competitive advantage, which is their low management fees, and to optimize the loyalty that their customers continuously demonstrate toward their organization, they must now target the most profitable segment for them, and develop the best way to serve and delight these customers.
Before being cultivated with cocaine and hookers as the key to success in Wall Street, Jordan Belfort demonstrated the incontrovertible advantages of positive business communications. One of which pertains to the effectiveness of corresponding with customers over the telephone. Especially for stockbrokers, having a conversation over the phone is pivotal when trying to sell a stock to a potential investor. Jordan Belfort began his process with a potential client by stating his name, where he was from, and what he had to offer. This was a method of gaining the trust of a customer that he did not know. Furthermore, he engaged the customer with an optimistic attitude and stated how the stock could affect him or her in the best way possible. Jordan coul...
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Citigroup ' was founded as City Bank of New York in 1812 and remained a large regional bank until October 1998. Sandy Weill, then CEO of The Travelers Group an insurance company announced a $76 billion agreement to merge with Citigroup to form a new financial services conglomerate. It took only two years for the merger to pass federal law since the 1933 Glass-Steagall Act prevented banking and insurance companies from ever becoming one entity. As the new CEO of Citigroup, Sandy Weill was now at the helm of one of largest banking institutions in the world with over 300,000 employees and operations in over 120 countries. Popular brand names included CitiCards, CitiFinancial, CitiMortgage, Primerica, Salomon Brothers, Smith Barney, Diners Club and CitiCapital. Citigroup became the world’s first global financial supermarket where banking, brokerage and insurance were all held under the control of one organization. Citigroup is organized into four major segments; Consumer Banking, Global Cards, Institutional Client Group, and Global Wealth Management. Citigroup offers a wide range of products from retail banking, credit card services, and mortgage loans to global transaction services, M&A financing, and corporate lending. Citigroup is currently the largest bank in the United States with over US$600 billion in deposits and assets under management of over US$1.2 trillion.
Lamb, C. W., Hair, J. F., McDaniel, C. D., & Wardlow, D. L. (2009). Essentials of marketing (6th ed.). Cincinnati, Ohio: South-Western College Pub..
In an interview with James Wetherbe, Richard M. Schulze tells of how at eleven-years-old he became an entrepreneur in St. Paul, Minnesota as a paperboy. This newspaper boy would grow up to be founder of the world’s largest consumer electronics chain store, Best Buy Co. Inc. (Schulze, 2014). As an adult in 1966 Schulze partnered up with Gary Smoliak and opened the company called Sound of Music until 1986 (Bailey, 2015). Schulze bought out Smoliak around 1970 and by 1983 he had changed the name of the company to Best Buy Co., Inc. Four years later Best Buy Co., Inc. secures an entry on the New York Stock Exchange. During the early 1990’s Best Buy Co., Inc., had become the largest consumer electronics store in the United States.
The history of Lehman Brothers (LBs) is dated back to 1844 when Henry Lehman and his two brothers established a small shop in Alabama (United States) to sell groceries and other commodities (Geisst, 2001). In the early 1900’s, they formed to a greater business company trading on the New York exchange market and the Cotton Exchange, which successfully promoted the family business to the retail giants with a partnership with Goldman and Sachs (Geisst, 2001; Wechsberg, 1966). Subsequently, the further opportunity raised in collaboration with some firms in the railway industry such as the Baltimore and Ohio railways, Chicago railways and others (Harward Business School, 2012). In 1975, the company achieved its success when it became the 4th largest investment bank in the US by merging with Kuhn, Loeb and Company, which boosted their financial activities in the financial market (Sloane, 1977). In the new line of business by diversifying their operations from a small shop via investments in the industry sectors, eventually they transformed to the company operating in the banking and brokerage (Geisst, 2001). Although LBs experienced remarkable successes and achievements, the housing market bubble in USA led to their collapse causing that in September 2008 the company filed for chapter 11 bankruptcy petitions that triggered a negative flow of consequences (Caplan et al., 2010).
Muller, J., Welch, D., & Greene, J. (2000, September 18). Businessweek - Business News, Stock Market & Financial Advice. Businessweek - Business News, Stock Market & Financial Advice. Retrieved April 17, 2011, from http://www.businessweek.com
Wall Street was not enamored with the coming regulation, but Congress was confident that the Street was seen as an easy target for the Crash and the Depression that followed. In response, the SEC was created by Congress on June 6, 1934 for the purpose of protecting the public and the individual investors against malpractice in the financial markets. Commenting on the creation of the SEC, Texas Congressman and future Speaker Sam Rayburn admitted3 “he didn’t know whether the legislation passed so readily because it was so good or so incomprehensible.
Richards, K., & Jones, E. (2008). Customer relationship management: finding value drivers. Industrial Marketing Management, 37, 120-130.