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Dlj Direct

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DLJdirect

DLJdirect

Purpose: During the 1990s, the online brokerage industry expanded rapidly. This rapid growth was due in large part to technological advancements, popularity of equity investments, and customer behavior changes. This growth has created a highly competitive landscape in which companies are spending more and more money on marketing in an attempt to capture additional market share. One company within the online brokerage industry, DLJdirect, faces difficult questions that it must answer to help form the company’s strategic plan in the near future and set a solid foundation for future growth and stability. The online brokerage industry can be broken down into four primary customer segments that are determined by certain characteristics such as net worth, risk tolerance, frequency of trading, and user interface expectations. Research has also indicated four leading competitors that control a large portion of the market share. Each of them target a specific segment, or segments, within the industry. Our primary purpose is to assist DLJdirect with analyzing their current business approach and analyzing the four customer segments in order to clearly determine which customers they should target based on DLJdirect’s strengths and business philosophy. We will also identify the main competition and DLJdirect’s points of differentiation and points of parity as they relate to each competitor in order to maximize this value for future branding and positioning. Based on our analysis, we will recommend a competitive strategy for DLJdirect to implement in the near-term that will help them determine their marketing approach, how much they will spend on marketing, and which customer segments will be ideal for them to target.

Analysis:

The first step of our analysis is to define the industry and business of

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