Brokerage firms: it’s time to shake it up — so said a workshop featured in this week’s Euromoney conference.
Mohamed Attiya, vice president of Tradenet, who led the workshop, said that advertising on LinkedIn.com provides more value than that of Al-Ahram thanks to its huge database of tailored profiles and information regarding subscribers.
The main theme was utilizing a client database in a cost-effective manner, which would allow a firm to branch out beyond its core focus and enter into periphery markets in order to generate further revenue.
He also noted that LinkedIn’s strategy has allowed it to hone in advertisements on its website seamlessly toward advertisers’ targets, providing a more effective approach, and thus invariably driving down the cost of advertising.
In his view, brokerage firms can learn from this and other examples to compete at a higher level. In addition to Al-Ahram and Linkedin.com, Attiya provided a presentation of several other case studies of businesses that are chipping away at traditional market stalwarts through new ways of attracting customers.
A prime example, he noted, is Amazon.com: if one compares Madbouly Bookstore to Amazon.com, it becomes clear that Amazon is doing what their competitor does and a whole lot more.
By having transformed all of the multinational company’s hard copy books into digital versions, it has freed up the firm to focus on non-core related activities, he explained.
Initially, however, when Amazon.com began, it collected swaths of information about its customers, which allowed it to expand its customer base. In turn, he said, the firm exploited this information by creating online communities.
The result of having proceeded in this manner permitted Amazon to attract its competitors to sell through its website, creating added sales for Amazon, as well as creating a detailed history of consumer purchases.
On this basis, the Amazon is now establishing a payment base, which will include the customer’s name, postal code, which grows profits, and thus, establishes a veritable “Internet Economy.”
In a second case study, Attiya also highlighted how Tesco, a British supermarket chain, applied for a banking license, and although this was not a central focus of the company, it has seized chunk of the Bank of Scotland’s market share, and is now “competing strongly,” he stated.
Once again, Tesco has proved successful due to its massive client database, allowing them to steer their marketing campaigns with utmost precision and with minimal overhead.
To sum up, in his view, Attiya says, information has transformed itself into a product and asset in its own right, which thus grows significant profits for a company with the ability to exploit such a dynamic — one brokerage firms should ponder.
