E*TRADE Hits The Big Apple with 'Super-Store'
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Feeling the heat from a sharp decline in online trading activity, financial services pioneer E*TRADE has moved ahead with its clicks-and-mortar strategy by opening a "super-store" in midtown Manhattan to hawk a range of Internet trading services.
E*TRADE officials unveiled the spanking new store, located at 540 Madison Avenue, Wednesday morning. Now, the online discount broker hopes that investors will come to its four levels of interactive technology and do more than buy and sell securities.
That E*TRADE is pushing forward on building a physical presence, this time in one of the busiest -- and more expensive -- locations in the U.S., comes as no surprise to industry observers. Stock market jitters among U.S households have stymied online trading activity for the Menlo Park, Calif.-based company, which has been moving to diversify its financial services offerings for over a year.
Like its competitors in the online trading space, E*TRADE has seen a decline in trading activity from U.S households. A study by J.D Power and Associates pegs the dropoff at 20 percent. Since last August, the study said, accounts of 800,000 online households have become inactive. It said the Internet trading population had reduced by almost 1 million.
Since last Fall, E*TRADE has been quietly rolling out its clicks-and-mortar strategy with the opening of an "E*TRADE Zone" in a Target store located in Georgia. The E*TRADE Zone (more than 20 are to be opened through the U.S) typically offers a few computer terminals, an ATM and a company representative during business hours.
E*TRADE, however, believes its slow migration to open physical locations is part of an "overall strategy to provide customers with brokerage, banking, insurance and wealth management services."
The Madison Avenue "super-store" fills out the bricks part of the strategy, and offers a dose of glitz and glamour associated with high-end shopping that is found in that section of New York City.
The company has wired the "E*TRADE Center" with more than 200 desktop computers (in a partnership with Compaq), complete with 20-inch flat screen monitors. On the bottom floor, it has set up a professional trading service area for active investors to place trading orders and conduct business.
The center's mezzanine level offers a spot for high net worth customers to conduct financial transactions and receive personalized attention from financial service associates. It said educational seminars would also be available to consumers on the top level.
Of course, there are the requisite E*TRADE Bank ATMs, gift shop, bookstore and cafe, all designed to attract (and sign up) potential customers for the company's financial services. The store is open seven days a week, mostly during business hours.
The center also contains a production studio where the 'E*TRADE On Air' show is broadcast, featuring daily live audio and video financial news.
In addition, E*TRADE said it has partnered with Aether to provide wireless demonstration stations for investors interested in learning about wireless financial services.