Forex - MoneyShow.com

RETAIL e-FX CLIENT
Patrick Meier
“FX is all about liquidity and it will become
increasingly difficult for brokers to only quote prices
without showing the liquidity as well; showing the
market depth will become indispensable.”
differentiators become harder for the broker but
much more meaningful for the customer. I am talking
about brokers creating long term strategies for
bringing the customer the best possible experience.
“This isn’t just customer service, I am talking about
every interaction that a person has with the company,
including defining the company’s products and
services around customer requirements. This concept
isn’t original to FX trading, it crosses all industries.
Customers want to have a good experience with a
company. I think that this desire will drive the next
rounds of evolution in this industry,” she continues.
In this highly competitive market, Michalowski agrees
that brokers can differentiate their offerings and
strengthen their value proposition by initially looking
at service. “If you are not customer focused, you have
nothing to offer,” he notes. “If you have a support
team that is readily accessible, and is able to answer
questions that come with opening
an account, you will attract a
solid customer.
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“Additionally, if you provide
competitive bid/ask spreads, and
are as consistent as possible with
the spreads, you will retain those customers. The bell
curve of trading knowledge for retail traders is wide,
so you must be able to connect and educate both the
novice and the more advanced trader,” he continues.
There are several approaches to strengthening brokers’
value propositions, Abu-Hamdan says. He notes some
focus on driving down cost, while others are offering
value added services. On operational efficiency, he says:
“The first option is to not differentiate the offering at
all, but to focus on the lowest prices possible with
operational efficiency. This is not necessarily an easy or
cheap thing to achieve as it places emphasis on highly
automated processes and large numbers of low margin
trades. Some brokers have adopted this approach,
offering accounts from $200.
“Of those who are differentiating, some are choosing
to place their offering as an aspirational brand; the
Gucci approach. Rather like a concierge service that
promises to get you tables at exclusive events. Others
are attempting to demystify FX by presenting very
simple trade platforms. The approach owes a lot to
the online poker sites that have exploded in the last
five years,” continues Abu-Hamdan.
Persichino says: “Brokers are trying to cover all kind
of clients, with different types of account, so that a
more diverse group of users can approach the FX
market. They can differentiate accounts by changing
the leverage or the amount of money required to
enter, or by letting the user decide what kind of
parameters they want,” he continues.
Benchmark winners
Regarding the concept of benchmarking, Michalowski
adds: “We are all benchmarked now. There are
winners and losers in every business segment. The
acceptance only comes from hard work, smart
decisions, and, at a minimum, hitting the benchmarks
prevalent in the market. New benchmarks will evolve
as mobile technology evolves, and manners in which
we educate customers will progress. Social media
avenues seem to be a direction that headline
knowledge can be distributed through in an effort to
attract a new audience,” Michalowski concludes.
While Meier states that brokers likely to be
benchmarked in the future on: available liquidity;
quality of execution; choices on front end options;
platform functionality; support efficiency (how inquiries
handled and resolved); added free trading resources; and
last but not least, level of transparency. “The brokers
that will rank highly in all categories might have a very
promising future indeed,” he sums up.