To: Sonny Blue who wrote (54125 ) 4/29/1999 5:18:00 PM From: Spytrdr Respond to of 164684
FORGET AMZN GUYS, EGRP IS THE STOCK TO OWN FOR 1999. DOUBLE, TRIPLE AND QUADRUPLE YOUR MONEY IN A YEAR. BESIDES, YOU DON'T HAVE ANY "MARGIN RESTRICTIONS" TO BUY EGRP ON MARGIN, AS YOU DO WITH THE STUPID VOLATILE AMZN AND OTHERS... READ THIS! ETrade puts on a show By Stephanie Gates Red Herring Online April 28, 1999 "Online investing is the killer app," declared ETrade's (Nasdaq: EGRP) chief marketing officer Jerry Gramaglia to a standing-room only audience at Hambrecht & Quist's (NYSE: HQ) annual technology conference yesterday. H&Q report: Gateway spins an apology ETrade puts on a show H&Q report: Pixar can make even a banker smile ETrade has reason to sound cocky. With 27 consecutive quarters of growth, more than one million online accounts, a billion-dollar war chest, and a hefty market capitalization, the company is sitting pretty right now. The online investment company has captured a significant share of a growing market with "between 20 to 25 percent of all new accounts," according to Mr. Gramaglia. Analysts at H&Q see Internet appliances as the future. ETrade acquired ClearStation less than a month ago. Nasdaq welcomes electronic communication networks (ECNs) like ASB. To increase its competitive edge and make its service easier to use, ETrade will launch a revamped Web site in the second week of May. Mr. Gramaglia says the next generation of ETrade should "give Yahoo (Nasdaq: YHOO) and AOL Finance (NYSE: AOL) a real run for its money." Apparently unconcerned with its dominant competition, the marketing executive neglected to mention Charles Schwab's (NYSE: SCH) online business. IGNORING THE DOWNSIDE More importantly, Mr. Gramaglia did not address the main issues dragging on the company, such as pending lawsuits and recurring system crashes during heavy trading. Instead, he put on a great show, wooing the audience with clips from television commercials and splashy pictures of billboard advertising. ETrade understands that in the commodity world of online trading, branding is a key differentiator. As Mr. Gramaglia summed it up, "It is really now all about brand choice." The company is pushing its brand with an aggressive marketing campaign that pitches a "Take Charge" message designed to convince average Americans to take charge of their life and, of course, their personal finances. ETrade has also recently spent $25 million on a customer service center in Atlanta, Georgia, to beef up its infrastructure and plans to expand into Japan and Switzerland, where it is currently operating test sites. INVESTING STRATEGICALLY While Mr. Gramaglia repeatedly mentioned ETrade's hefty $1 billion war chest, he did not articulate the company's strategy for spending its cash. The company has already made a number of strategic investments, including a 28 percent investment in online investment bank EOffering and a 25 percent investment in transaction company ASB (formerly Archipelago Services). In March, ETrade also agreed to acquire financial advisory Web site ClearStation in an all-stock transaction. The purchase will allow ETrade to expand its online offerings. Clearly, the company has a long shopping list. But don't attend a presentation expecting to gain stategic information and insight. You may have to settle for just a good show.