Some bank employees and executives may feel concerned about the existence of physical branches in the future. Buzzwords such as FinTech and blockchain, along with an increasing number of digital and mobile transactions, may lead one to believe the branch is a thing of the past.
However, physical bank and credit union branches are here to stay. In an age of tech-centricity, branch experiences are major opportunities for financial institutions, serving as make-or-break chances to truly engage and connect with customers in order to differentiate from the competition. Moreover, valuable customers seek out in-person experiences to help them navigate complex financial issues of high importance to them.
Evolution of the In-Person Branch Experience
While there are inevitably some closures in branches due to an increasingly digital customer base, this number is smaller than what most people might assume. In fact, the vast majority of financial institutions don’t have plans to close a branch this next year.
With this in mind, financial institutions should think about how their branches plan to evolve:
- Financial institutions should focus on adding value. This means creating options for in-person or digital kiosk-driven tasks, and allowing individuals to seek out in-person experiences when they desire.
- Education of universal bankers to handle complex problems and tasks should be a key priority for financial institutions. This means a heavy investment in staff education.
- Financial institutions should be capitalizing on infrequent branch visitors by delighting them. Educated staff, convenience and unique branch concepts, like the Capital One Cafe, will see adoption in the future.
Finances Are Viewed and Complex and Important
One of the main reasons customers seek out a branch experience is to resolve an issue. Because of this, banks should be training universal bankers armed with information and insight into their financial institution’s various functions and revenue streams, along with a wide variety of customer types, being prepared to deal more with complex issues and less with basic transactions, which consumers tend to handle increasingly digitally.
Other reasons consumers seek out branch experiences are for education about products and their general financial health, as well as performing routine transactions. On the prior, financial institutions should invest in ways to be general financial consultants for their customers in order to differentiate their brand. On the latter example of routine transactions, financial institutions should consider the way technology (e.g., digital kiosks) and their staff intersect in order to streamline those processes and add convenience for customers.
High-Value Customers
Older individuals with higher net worths and individuals with more complex financial issues, such as business owners or those with major loans, seek out branch experiences. The logic is simple: When dealing with something complicated, they want to have a face to face conversations. This is a reassurance that they can have a continuity of help (meeting with the same individual multiple times), ensures that their requests can’t be evaded, and generally instills a higher degree of confidence in their interactions.
Beyond this, customers that are more loyal tend to be those who engage in regular branch experiences. Familiarity, location and interpersonal connection all contribute to this. On top of that, as mentioned, branch experiences tend to be major customer service differentiators.
