The Cash Connection
The payday lending industry is a very competitive industry established in the 1990’s, designed to give citizens the option to receive a quick fix regarding financial issues, in an effort to make ends meet. The main objective for those in the payday loan industry “should be to serve customers in compliance with the rules of the industry and better educate them on the services and products they offer” (Personal Communications, 2012). This industry raises the controversial topic of ethical, or unethical, and to this day is still being disputed.
Cash Connection’s strategy is “to provide financial products and services to the unbanked and financially underserved customers”(CashConnection.eu), also to set themselves apart their competition with the intention of becoming the most dominant franchise in the lending industry. The lending industry was established to provide citizens in a financial crisis with quick cash loans while adhering to the rules of the industry, and informing them of the importance of wise borrowing.
A focused differentiation strategy is defined as “concentrating on a narrow buyer segment and outcompeting rivals with a product offering that meets the specific tastes and requirements of niche members better than the product offerings of rivals”. Cash Connection is taking this approach by offering attractive features to its customers that its competitors cannot offer. The different characteristics consumers find valuable when searching for a quick cash loan, such as lower interest rates, and larger loans have an impact on the consumer’s purchase decision. Cash Connection uses that to their advantage by focusing their strategy around those features in an effort to become the leading lending franchise in that industry. In the excerpt given by Paul Smith there is evidence that suggests that Cash Connection’s strategy and business model is ethical. “Individuals taking high interest loans were...
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