Retail banks are going through a transitional period as they try to meet the demands of a real-time, always on and connected customer base while still maintaining the high-touch value of a branch experience. Banks are challenged with developing a branch strategy due to rising real estate prices, increased costs per transaction and a drop in foot traffic.
But branches provide important brand exposure to local markets, and many of the bank’s highest value sales occur there. Can the Universal Banker model, Interactive Teller Machines (ITMs), open floorplans, and tech bars create an effective strategy? These are key elements, but there are other opportunities to consider.
This is the first in a series of blog posts about branch banking from the perspective of a company that has helped banks—and clients in other industries—create strong engagement. We do this through a strategy and design-led approach to understand the unique needs of our clients and their customers. And rather than replace our clients’ investments in core technology, we leverage it to build systems of engagement. In this and subsequent posts, I’ll use our breadth of cross-industry experience to provide guidance for improving the value of branches to banking customers—and in turn, the value of the branches to the banks. We’ll also explore ideas we have to improve the customer’s experience, while also improving efficiency in the bank —we’ll look to you for help honing these ideas.
Let’s get started.
Future Branches Focus on Customer Experience
Back in early December, I attended the Future Branches conference in San Diego. Conference attendees included a cross-section of large and small banks and credit unions. There, they shared their experiences on transforming their branches to meet the needs of today’s market. Many great topics were discussed, including how to include ITMs in your strategy, organizational challenges with transformation, and when to apply Universal Bankers vs. specialized roles.
In this post, I’m going to focus on one topic in particular—the overall branch customer experience.
As Sterling Nelson, CEO of Mountain America Credit Union said “We think of the branch transformation from not just a Return on Investment (ROI) perspective, but also from a Return on Experience (ROE) perspective…”
At the conference, a significant focus of improving customer experience revolved around floorplan layout (open spaces, removing the us-versus-them feeling, areas for more intimate engagement), where to position ITMs and times of day they should be available, and banker stations that enable the banker to share their experience with the customer.
Is your software contextual?
That last one—banker stations—got me thinking. To create the most value for your customer, you need to provide them with just the right service or product given their context—knowing who they are, where they are, what they need, and when they need it. Doing this builds loyalty. Creating the physical spaces for this contextual interaction to happen is critical. But you need more than the physical spaces to understand your customer’s context. Does the software you run in your branch provide that context? Should you be sharing the information that your banker sees with the customer? Will they understand what they are looking at?
The software that runs your branch may not be equipped to provide your employees with their customer’s context. Should you throw it away? Not necessarily. Off the shelf software may not provide what you need for great engagement. But you can build on what you have. For instance, you can leverage your customer’s own devices to execute in-branch services. In private spaces, you can create a shared context with a smart monitor that can run an app that shows your customer the same things your banker is seeing (though likely with less detail). You need to make it easy for your customers. Show them you understand their context. This is how you build loyalty and generate new and more rewarding sales. The physical spaces are great, but your bankers need the tools to make those spaces valuable to their customers.
For instance, in the retail vertical, Summa worked with PPG to improve the experience their customers had when choosing a color for painting rooms in their home. Customers wanted a simple way to see what different colors would look like in their own home before committing to a specific color. Swatches weren’t good enough to get the feel of the color at scale, and samples required multiple trips to the paint store to complete the job. Summa worked with PPG to understand their customer’s needs and co-developed a multi-channel solution that takes the customer’s context into account. Now a customer can upload a picture at home through a PPG web site or at a store using a kiosk, apply colors to the walls they want to paint and share the results on social media to get input from friends and family. And this can be rebranded to the many global paint brands that PPG owns. The result was satisfied customers, and store kiosk adoption exceeded PPGs goal by 12x. By taking their customer’s context into account, PPG was able to significantly improve their customer’s paint buying experience.
Summa’s banking history, Future Branch concept and what’s next
At Summa, we have a long history of working with retail, commercial, and reserve banks. We’ve helped them modernize their consumer, wealth management, and corporate digital banking platforms, and created new mobile experiences for retail and wealth management segments. We’ve also built real time peer-to-peer payment systems, connected banks-to-banks and third party banking services, and developed APIs for others to integrate with the bank. All of which enabled new business opportunities through increased customer value, faster time to market, and more efficient operations.
We also have a strong background in helping clients improve customer engagement, led by our Human Centered Design approach. We’ve written before about the importance of understanding opportunities to better engage your customers. We know, as some businesses know and many are learning, that engagement is critical for building loyalty and increasing sales (see chapter 2 of the Outside In book from Forrester for good case studies on the top and bottom-line impact of good customer engagement).
Given our background helping banks and research we’ve done in the retail banking space, we are working on a concept for branch banking that enables strong customer engagement while also improving branch operations. It uses your customer’s device to improve their in-branch experience, and empower bankers with mobile devices that allow them to engage customers in those open floorplans and have the contextual data to create amazing experiences. Get in touch if you’d like to learn more about it.
In my next post, I'll start exploring something that challenged many of the people I spoke with at Future Branch: aligning your digital and in-branch experience.
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