Industry News

Why Branches Still Matter

 

By Gregg Rosen, President and Principal of NES Group
Published in Banking New England Jul/Aug 2018 edition 

 

 

 

It comes as no surprise that with the adoption of self-service channels, financial institutions are seeing less consumers physically enter their retail branch. Consumers of all age’s want 24/7, 365 day digital access. Some are beginning to wonder, what does the future hold for the traditional branch?

 

The consumers have spoken, in fact branches are still necessary… they do matter. Based on research performed by Diebold Nixdorf, we learned that 52% of consumers consider access to branches and ATM’s to be important when selecting a financial institution. More than 67% of consumers prefer to physically go into a branch to open a new account, make a deposit, receive financial advice, get questions answered and apply for a loan and resolve account issues. But we also know that majority of these tasks can be done via mobile banking so some may wonder why they would actually go into a branch to do so.

 

Consumers state that they feel handling these tasks face-to-face at their local financial institution’s branch gives them more security and a better understanding of their account as a whole. Their questions or issues can be resolved right then and there resulting in higher satisfaction when leaving the branch. Developing an extensive branch transformation plan and understanding the changes required for your branch’s needs is just the start to delivering the best branch experience. Banks and Credit Unions will have to craft a smooth transition between physical and digital channels with an extensive omnichannel approach. Revamping the digital customer experience has not only become essential but also intriguing for financial institutions. It has given them the opportunity to be cutting-edge and separate themselves from competition. So how does the traditional branch adapt to overcome the ever-changing consumer behavior to stay relevant?

 

Get to Know Your Customers
First and foremost, we must put technology aside for a moment and reevaluate your understanding of who your consumers are and analyze what they want and need from a financial institution. Where are they banking? What channels they are using and favoring? Each institution’s client base is made of multiple generations from Baby Boomers, Generation X, Millennials and Gen Z, just to name a few. Financial marketers should use data mining to properly market to each generation. Catering to Millennials should be a high priority as they are currently the largest living generation in the U.S. We all know they rely heavily on digital channels for just about everything, but they are also the generation that may need education when it comes to student loans, marriage, or buying a house. The closer you are to understanding your consumers of all ages, and how they operate, the more accurate your approach in planning will be.

 

Create an Interactive and Social Experience
It is crucial to equip your branch with technology and staff members that align with your new goals. We know consumers visit branches less and less so we have to make an impact each time they walk in the door. Do you want them to stand in line at teller stations or begin a journey and experience that tells your story and allows you to serve them to the fullest? Consider the open path to interactive teller pods or self-service kiosks. With the proper training, that mobility allows your staff to become greeters, customer service / sales representatives and brand ambassadors that are interacting and engaging with your consumers resulting in a personal and less intimidating atmosphere. Find ways to integrate digital technology in the branch and allow all of your services to be visible during open and closed hours. Provide them ways to discover, explore and learn about who you are 24/7. Be engaged with your community, understand your neighbors and local businesses—their local branch should feel like home every time they visit.

 

Design a Branch Tailored for Your Brand
Still in this digitally driven era, branches give banks and credit unions the opportunity to communicate exactly who they are and what they can do for their consumers through an innovative branding technique. A well-designed branch that coincides with your brand is imperative when trying to create an unforgettable branch experience. “The story begins the moment your customer walks through the door.” We have found that eliminating barriers and using an open floor concept creates an opportunity for a more welcoming and easy to navigate atmosphere. Vibrant colors and patterns through finishes, wall color, furniture, lighting and marketing can bring a tremendous amount of energy to your customers and even your staff.

 

So the answer is yes, branches do matter and we are confident that they always will. Financial institutions must adapt to the fact that branches of today will look different and function differently but in the end consumers still appreciate their local branch. While it may take some future thinking strategies, self-service channels and even a transformation to keep branches alive and booming, they are not going anywhere but up.