Our Vanishing Bank Branches

 This was the title to an article I read in the Daily Mail (a somewhat fluffy British newspaper) by Victoria Bischoff on 7/30/14. There were several interesting elements to this article that are different from the usual emphasis on design and technology.  Here is what I read:

• "Money Mail discovers how new technology is forcing us all to go self-service"
• "A young man, clutching an iPad and wearing a fashionable black cardigan, is striding... He smiles and asks: what have you come here to do today?"
• In the UK "just 47% of bank customers use a branch once a month, compared to 80% for online services".
• "It would be wrong to think banks want to get rid of branches altogether.  They are far too valuable.  A report from the Competition and Markets Authority showed they are vital to cross-selling other products to current account (checking account) customers".
• "So it's the way we use branches that is going to change. Banks want staff to spend less time on basic transactions - particularly if we can do it ourselves using a machine".
• "The way banks are setting up their branches means those who are not technologically enabled are going to struggle... To combat this criticism Barclays has technology experts in every branch knock as "Digital Eagles".  They host "Tea and teach" sessions and give one-on-one advice on how to use a computer.  You don't even have to be a Barclays' customer, and they help with more than just online banking.  They can set up your email account and show you how to use Skype or book train tickets online".
• "Staff mills around, making sure everyone knows what they're doing... With its comfy purple chairs and pink designer lamp it feels more like a hotel reception than a bank".
• The reporter describes a mortgage application experience:  "Customers are given a private room that has a camera and two screens, a printer and a scanner.  The adviser appears on screen and talks the customer through their mortgage application.  The form appears on a second screen, and customers can also use a computer to check details on the internet.  They can put their payslips and other documents into a machine, where the adviser will scan them... The picture is clearer than my TV, and the décor behind her is exactly the same as this branch."

This article takes the customer's viewpoint, and I find numerous enlightening insights in it.

The reporter focused on the entire experience and feel of the branch and the devices.  There was very little said about the functionality.  It basically stated that the machines and self-service can do anything that has to do with withdrawing and depositing money, as well as bill payments (the machines scan the barcode of the bill and then walk you through payment).  We sometimes forget that functionality is assumed by the customer, and it is the experience they find most differentiating.

Several mentions were made regarding efficiencies and the motivation behind these moves, but even this reporter saw the value in this transformation to the customer.  Lines move faster, she said, and the transactions are easier.  My takeaway is, it's OK to achieve staffing and other efficiencies if the customer gains value from the end result.  As the reporter said, after visiting five different high-tech bank branches there is value in this new concept.

On-site technical support is essential to improved experience and adoption rates.  Those "Digital Eagles", the British banks' answer to Apple's Genius Squad, is key to success.  Economizing on that aspect of the staffing is a mistake.  Further, the Techies also assist customers in non-bank matters, thereby giving them a reason to come to the bank beyond their immediate banking needs, which is a good thing if you're an effective cross-seller.  Last, it build trust and creates value-add.

In one paragraph the reporter described the branch as feeling like a hotel not like a bank.  That's another interesting aspect that many banks have worked on.  Our ultimate goal, as the reporter wisely points out, is to get people to the branch for cross-selling activities.  The welcoming atmosphere of the branch and its comfortable surroundings facilitate listening to pitches and product information.  It is amazing what impact the perception of comfort has on the amount of time spent in a location.  Starbucks is a perfect example of that.  Having a welcoming facility staffed with people who aren't connected to a desk or a screen is an important step to achieve an atmosphere transformation.

Achieving a seamless digital experience is another element to the transformation.  I thought it interesting that the reporter noticed that the remote adviser worked in a facility that looked just like the branch she was in - a small but significant detail.  She reported favorably on the mortgage application experience, something that is not easy to achieve, especially given the importance and complexity of the transaction.  The availability of the scanner and two screens was crucial to the seamlessness of the experience as well.

The Daily Mail article was another affirmation that banks worldwide are struggling with the same question:  How do we sell to customers who don't come to the branch?  And how to we serve those who do come to the branch for routine transactions more efficiently without losing the special connection we work so hard to establish with them?  The elements of the "experience," efficiency, comfort, atmosphere, and seamless functionality mentioned above are part of the story; however, the first step toward success is to clearly define the desired end result both in terms of the customer experience as well as the economics.  Only then can one move forward in creating a branch experience customers will want to return to again and again.