Edward Jones Case

Topics: Financial services, Stock broker, Mutual fund Pages: 3 (872 words) Published: December 11, 2011
a. What explains the success of Edward Jones over so many years? From the time of its inception, Edward Jones has been focused about the customer segments, the markets and the products segments it wants to operate in. This focus has allowed Edward Jones to concentrate efforts and resources towards these segments and maximize the penetration within and profitability from this segment. The key factors that have helped build this strategy and the resulting success of Edward Jones are: 1. Geographic Focus with operating in markets with no competition: Edward Jones started its operations by opening up branches in rural areas. In its expansion stage too, it continued to open branches in non-urban locations. In most of these locations, Edward Jones was competing only with the local bank branch, which at the time was not offering brokerage services or was offering only limited options in this segment. This resulted in Edward Jones being able to thrive with almost no competition which added to its success. Also, by opening offices in areas such as shopping malls, Edward Jones was operating in high-traffic centrally located parts of the town and hence getting incremental walk-ins resulting in more business. 2. Catering to all Customer Segments, esp. the smaller customers: Edward Jones never wavered from its product strategy or tried to differentiate its service based on the amount of investment made by a client. It was also very clear about the end-customer being its client and, unlike Raymond James which considered the FA to be the client; Edward Jones was focused on delivering value to the customer. As a majority of brokerage houses targeted High Net-worth clients, Edward Jones faced limited competition in the smaller client customer segment. It still had over 52000 customers with over $1 Million in investments but getting the smaller accounts and having them grow with Edward Jones helped the firm take advantage of the limited competition and establish dominance...
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