Operating under the premise that sophisticated investors will be naturally drawn to its product, Datek Online Brokerage Services hit the road in a recreational vehicle to reach these potential customers face to face.
The company embarked last week on its 14-city Built to Trade tour to educate consumers about the hidden costs and pitfalls for investors who use other online brokerages.
“The point of this is to provide some education, and obviously we want to get our name out there,” said Michael Dunn, spokesman for Datek, Iselin, NJ. “There are aspects of online trading that aren't readily apparent to some people.”
The marketing road trip has become a mainstay of Web sites looking to get in the trenches to try and convert consumers. Dozens of dot-coms have traveled cross-country in all-terrain vehicles, flatbed trucks and recreational vehicles. These companies include Bolt.com, Emazing.com, Headhunter.net and UGO.com.
This addition to the convoy will run through May.
In Datek's case, the vehicle is a 37-foot Winnebago equipped with seven kiosks that illustrate Datek.com services and features. Up to 35 people can enter the vehicle at one time for a demonstration. At each city, one consumer will be awarded a $2,500 account.
Datek Online is one of the nation's largest online brokerage firms in terms of average daily trades. ETrade is bigger, but that's fine with Dunn.
“They spend a lot more on advertising. We're not seeking to become the largest, we're seeking to become the one that attracts the knowledgeable investor,” he said. “Not everybody will take the time to become educated.”
The online investing space is not likely to be affected by the dot-com tumble, Dunn said. “Online investing is one of those businesses that make sense to do online. It used to be that you'd call a broker to get a quote and he's out to lunch half the time. We offer information that you could only previously get from a broker.”
Business has been growing steadily. At the end of 1998, the site had 152,000 accounts with funds in them. A year later, it had 340,000. Datek announced that as of the third quarter this year, it had 624,000 funded accounts.
The RV will visit Atlanta; Orlando, FL; Miami; Houston; Austin, TX; Dallas; Phoenix; Los Angeles; San Francisco; Seattle; Chicago; Boston; New York; and Washington.
