Averick Parker
Mark 7990
Dr. John Hulland
ING Direct

The proposition that ING Direct has set forth will likely have initial success in the Canadian market, especially if they pursue the higher-end markets as the strategy they plan on moving forward with suggests they do. The segment that is most likely to be attracted to this product would be consumers who have multiple accounts with several different banks so they’re not averse to investing or saving their money in a bank that has a slightly diversified or innovative product. With this strategy they will likely be going after high-end clientele, which translates profit margins for ING. In order to effectively implement this plan, ING will probably need to have a mix of employees who are already trained in the financial services arena or employees who are capable of being trained and becoming successful in this area. Because of this and potential salary implications, entering this market will have a high cost of entry for ING Direct, and they will likely need to take the proper measures to ensure they are successful over the next 3-5 years.
Mbanx and similar companies may be threatened by ING Direct’s entrance into this segment of the market. Because their reputation with customers isn’t very strong currently, they will likely do one of two things: 1) They will get pushed out of the marketplace because there is a more reliable and credible service provider in town 2) They will reformat their business model to remain competitive, which could pose a relatively strong challenge for ING.
ING Direct’s business model is financially viable but that depends on a few external factors. The first being how receptive potential customers in the market are to their products and services. While it is understood that several customers in the Canadian market aren’t necessarily loyal to one bank, the costs for ING to enter this market are extremely high and they will need a strong entrance to support their push. Something that could help them through their first year would be to place their in-house representatives on a heavy commission based salary with bonus