Charles Schwaz Harvard Marketing Case

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Charles Schwab & Co., Inc.: The “Talk to Chuck” Background: Incorporated by Charles Schwab (Chuck), Charles Schwab & Co., Inc. was the first company to offer discounted self-service on brokerage fee, giving clients more independence in managing their assets and make transactions without help of traditional brokers. The company grew quickly as it charged 75% less per transaction compared to that of large brokerage firms. This instant success of the company made Bank of America to acquire Charles Schwab & Co in 1983, however Schwab management has bought back all of its shares within four years. Over the course of years, company continued to grow both in terms of number of customers and revenue it generated. The company also launched an online platform and soon became one of the biggest financial services in the industry. However in the early 20’s the customer started loosing trust in the brand and consequently revenue was declined by 39% and ultimately company lost its market share. To recover from this damage, company has launched the “Talk to Chuck” campaign in 2005. The main idea behind the campaign was to give the clients a feeling as if they talked to Chuck. The marketing team wanted to control the risk of this campaign, for any unseen events, so they have planned to test TTC campaign in three major cities Chicago, Denver and Houston (which account for only 6% of Schwab’s invested assets with a test cost of $15 million. The test was marked as success as it resulted in an increase in number of accounts and new assets. The management has to take a decision on taking this campaign nationwide with a proposed budget of $200 million. Recommendation: I would recommend the company to continue with the TTC campaign with proposed budget. The comeback of Charles Schwab, boosted with success of test campaign is the right time for the management to turn the

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