The Internet1s potential use as a stock exchange channel is very attractive. Companies are excited about reaching more consumers at low operating costs. The Internet connects huge number of users and is the fastest growing worldwide communication resource. It provides a standard for information exchange and transcends normal communication media. The attractiveness of doing business on the Internet stems from it1s rapid growth, global reach, and superior communications capabilities. As a market it provides a pool of techno-savvy consumers that are well educated(67% have college or professional degrees) and well paid(the average income is $69,000). Users are almost employed in computer related and education or professional occupations. Users of Internet usually have money to invest stock while stock exchanging agency can get a good database from Internet. Therefore, discount brokerage on the Internet is more attractive than traditional brokerage because the Internet brokerage service company can reduce commission fee and it can secure huge potential customers who are educated, professionalized, and so on. Some kind of customers don1t want to receive information because they know very well about stock market and company information. this customer profile values low commission fee, hence companies such as eBroker does not provide specific information to customers. Their only focus is on low commission fees.
As we know, the characteristics of on-line brokerage users differ from full-service brokerage users. The difference was followed in Table 2. Therefore, first of all, in order to overcome its intense competition, We think that on-line brokerage company must plan to attract a different type of clientele that is generally older, less technically savvy and trades less frequently. Usually, this kind of clientele wants a full service brokerage. So, on-line brokerage companies tend to expand their customer support business to absorb full service brokerage users.
All on-line users will not remain as Internet consumers. So companies need to make an effort for on-line users to slowly convert into the Internet consumer profile. For such a marketing effort, companies must provide services which are low cost, with quality execution, and excellent graphical user interface. They must also provide continuous client support.
The Internet is a world wide network, therefore on-line brokerage companies can globalize their companies in order to deal with portability issues in other International stock markets.