ETrade Securities Inc. Harvard Case Solution & Analysis

ETrade pioneer in electronic deep-discount brokerage business and experienced phenomenal growth due to the wide use of technology to achieve significant advantages compared to traditional value of the firm. ETrade strategy was to pass these savings on to their customers automation, as their fixed costs are amortized on a greater number of accounts. By 1996, the influx of new competitors in the creation of web sites and ETrade was ousted as the price leader. While some leaders in the ETrade believe they should continue to reduce prices and to go head-to-head with eBroker, others believe that the company is facing a big challenge of joining Charles Schwab on the market. Protection from Schwab require concentrating resources on improving its products / services that may threaten the position of ETrade's cheap. ETrade must decide where it can create a profitable and sustainable position in terms of price / quality (service) compromise. "Hide
by Rajiv Lal, Chuck Glew, All Lotke, Mario Palumbo, Mark Schwartz Source: Stanford Graduate School of Business 16 pages. Publication Date: July 1, 1996. Prod. #: M286-PDF-ENG

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