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Skewed client base- On the investment

attitude parameter, Schwabs client base was underweighted in the high-touch segment and over-weighted in the self-assured segment Unfavourable Brand Asset Value- Schwabs perceived differentiation had declined considerably. It looked less like a leadingedge discount broker and more like a fullservice broker

Faulty brand advertising- The Companys

brand advertising had been haphazard. The emphasis had been on creating direct-mail and e-mail for specific products and services. At one point, it had six major marketing campaigns running simultaneously Declining profitability and market share

4600 4500 4400 4300 4200 4100 4000 3900 3800 3700 3600 1 2 3 4 5 Revenue

Net New Assets

80 70 60 50 40 30 20 10 0 1 2 3 4 5

Net New Assets

Consumer Benefit:identification of painpoints and their solution Reason-Why:Promise of personal service and problem resolution at a reasonable price Supporting Evidence:credibility of the founder,core problem solving values Tone of voice: informality and approachability Target: Mass affluent investors($50000$2million to invest),confident

On most measures, consumers rated Schwab more favourably in the test markets as the campaign progressed The company had a 5% reduction in attrition in six months between April and September. Both call-centre customer contacts and fieldsales activities increased. 6% increase in revenue from year-end 2004 to 2005 and 153% increase in net-income for the same period. Net new assets increased by 10% over the previous month

On average 111% lift in test markets among new and existing households(new households with 125% lift and existing households with 98% lift) Net new assets, which is new assets minus withdrawn assets increased 205% on average among existing and new households (new households 137% lift and existing households 273% lift)

Net Income
800 700 600 500 400 300 200 100 0 1 2 3 4 5

Net Income

The success of TTC campaign was demonstrated through these two encouraging crucial metrics of the business, and they were strong enough that the TTC campaign was extended to a nationwide footprint in September 2005 200 million marketing expenditure ($55 million will be allocated to the TTCcampaign) seem to be safely offset by the additional net income that comes to Charles Schwab,

The campaign can offer great income opportunities that make the increased marketing expenditure justified. In addition, the proposed advertising will be concentrated during non-slow seasons, when client investment activity and new account openings have been strong historically.