Case | HBS Case Collection | December 1999 (Revised December 2000)

Charles Schwab: A Category of One

by Stephen P. Bradley and Thomas H. Esperson


Examines Charles Schwab's on-line discount brokerage firm and questions whether or not Schwab has effectively balanced the old and new world of stock trading, and has remained a leader between giants like Merrill Lynch and Internet pure plays like E-Trade. Also looks at how Schwab has remained a competitive player with 363 brick and mortar branches while continuing to boost 81% of its trades over the Internet. While major bank mergers began to emerge as dominant online players, Schwab's unique status as a discount brokerage began to wane. In the wake of powerful full-service firms gaining online presence and discount brokerages offering $4.95 trades, how could Schwab sustain its competitive advantage?

Keywords: Financial Institutions; Banks and Banking; Technological Innovation; Goals and Objectives; Growth and Development Strategy; Growth Management; Competition; Competitive Strategy; Competitive Advantage; Banking Industry; Financial Services Industry;


Bradley, Stephen P., and Thomas H. Esperson. "Charles Schwab: A Category of One." Harvard Business School Case 700-043, December 1999. (Revised December 2000.)