In a case of what could be over saturation in the online discount brokerage firm field, ex24 has closed up shop.

Back in November of last year, I had a chance to speak with Anthony Link, ex24’s Chief Operating Officer. Bound with excitement, both he and James Lennane, the company’s founder had high expectations for the company.

Perhaps the expectations were too high.

Despite marketing campaigns that included iPod giveaways, free trading periods, guaranteed portfolio performance and access to fractional shares of sought-after stocks such as Google Inc. (GOOG) shortly after its initial public offering, the platform never gained momentum.

“We were looking to go further, faster, which is why we decided to call it a day,” said Anthony Link, the company’s chief operating officer. -Source

The company never made any money, and was being fed a healthy diet of capital by its founder who finally decided he’d had enough.

The company’s website has been shut down, leaving only the following message:

ex24 is sorry to announce that as of May 14, 2007 we are no longer doing business. If you have any concerns about your ex24 Member account please contact Member Support Services at (800) 524-3924.

Thank you.
ex24, Inc.
200 Patriot Way
Naples, Florida 34104
(800) 524-3924

This is a prime example of a failing business plan due to not being able to attract customers. I wouldn’t really call it a failure of marketing per se, but rather a failure of a combination of things that failed to attract any capital.

Profit margins are slim in the discount brokerage sector, and lacking clients means dwindling income.

I was never a big fan of their ATS order book concept. The idea was that individual buyers could be matched up with individual sellers through the platform itself. Effectively this would make a 24 hour market.

The problem with this idea is that it’s only useful if there is liquidity, not only in the stock but in the platform itself. It is useless if there are only 100 traders using ex24 and not one of them wants to buy your 200 shares of Google for anything above market value. The lack of volume and the thin number of available securities doomed this idea from the beginning.

Anyway, ex24 customers had the option of closing out their accounts or being transferred to Vienna, Va., brokerage firm FOLIOfn Inc.

Brokers, Business, Investing, Marketing

Back in August I wrote about how shopping a generation behind will save you money. I also listed a link to get a free Schick Titanium razor blade.

Well, about eight weeks after signing up, I got my new four-bladed Schick Quattro in the mail. It came in a neatly packaged box with the Schick brand and logo all over it.

Funny, but just two weeks later, Gillette sent me an unsolicited free Fusion razor in a very similar box, with very similar logo placement. In addtion, they packaged coupons into the box for discounts on refill cartiges. Keep in mind, I never signed up to get a free Gillette Fusion razor.

Seems to me that somebody’s been sharing a marketing database with the competition…

Now that I have two competing products to try out, I may just write a review. I can tell you this much, my previous generation Mach 3 Turbo beats both of the new products in price, hands down.

Business, Marketing

The evolution of the blog is moving in on marketing.  A site called PayPerPost is offering up money for blog posts containing specific content on products or services.  Bloggers can get paid as much as $5 or more per post of which the topic can range from which search engine you prefer to reviewing a hair drug testing kit that parents can use on their kids.

BusinessWeek had a recent article on this very subject.  After reading it, I have to wonder if this is the new blogging fad, much like pay-per-click has been for the last few years.  To some extent, this is a great way to get word of a new product out to the internet.  What better way to publicize your new widget than to pay bloggers to comment on it.

A not so traditional effect of this type of marketing is that it induces a bias into an otherwise subjective review.  If a blogger gets paid $5 to talk up a  product, chances are, the product is going to get some good verbage.  On top of it all, the blogger is not required to reveal that he is getting paid to write the post, although the BW article suggests that it’s up to bloggers to uphold their own morality.

With this non-disclosure advertising, will product reviews hold any weight?  Will long standing review sites like CNET.com jump into the game, or will they be able to filter out paid opinions?  What effect will this have on pay-per-click advertisements?

This type of advertising will put more responsibility on the consumer to research products. While it’s hard to say if this type of advertising will catch on and become commonplace on the ‘net, but it’s sure got a good start.

It will be an interesting trend to watch, and one that David Houle at EvolutionShift along with his buddies at BlueLinerMarketing will surely have an opinion on.

Disclosure: I was not paid to write any of this…

Marketing