There is a wind of change continues to blow across the banking industry. The big question on the minds of bankers I meet at the moment is ‘how do I save cost and grow my market share?’. Network Optimisation and Omni-channel are two of the ‘buzz phrases’ I am hearing used to describe possible answers but, what does this mean for customers?
Some might jump to the conclusion that Network Optimisation means reducing the number of branches in your network... and it may...or it may not... it will vary from organisation to organisation. What is a constant, and is highlighted in global research I have seen in the past few weeks from Accenture, is that although bank customers are moving more and more towards digital channels, customers want to know there is a physical branch network that is conveniently located should they wish to visit it.
Finally, there is evidence to back my hypothesis that the branch network will never die. Indeed, I believe there will always need to be a space where customers can meet real people, enjoy a physical brand experience and ask questions from real people connected to a business they trust with their livelihood.
So what does this mean for banks?
The format, location and purpose of a bank branch will need to change in order to meet and exceed customers expectations. Gone will be the large ‘super-branches’ of yesterday. These will be replaced by smaller, more agile spaces (stores), which work compliment the digital eco-system banks are creating around their offer and their customers. These spaces will, dare I say it... and CEO’s please listen... have staff in them. These staff will be entirely different to the kind of staff we see in many bank branches today, they will be people people, they will understand how to listen, how to teach and how to sell to customers in a non-threatening, open way, with a relationship based on mutual trust. Technology will play a role too, not only on the devices we use, but in the store too. Gone will be the banks of iPads that more often than not do not work. They will be replaced by responsive, intelligent technologies that offer customers a real and tangible benefit. Technology will be used to understand customers better too and drive revenue and sales for banks. Technology that recognises who you are, what you need and how the bank can serve you better. Technology will be used to communicate messages that are relevant and personal to you, not generic marketing noise that annoys and goes over your head. We may even see complimentary services appearing in bank stores, where customers and avail of offers and promotions from the banks partners... simply by visiting the bank store.
So where will the bank store be located?
The store of the future will be a link between the digital and physical worlds, where customers experience the brand in a multi-sensory way. Stores will be smaller, as I have said, they will be strategically placed in locations that give the brand greater visibility, improved convenience, a simple reason for customers to visit.
Be prepared for the future, it is coming and it will be nothing like the present.
My top five tips for bank CEO’s in preparing for the future:
Never over promise - make sure your technology is able to deliver on promises you make and is built to evolve
Customer experience is a key differentiator - with most bank products being similar, the only differentiator is customer and brand experience. Invest in this and get it right. Decide who you are, be unique and occupy a specific territory in your customers minds - define the golden thread that describes who you are and ensure this thread runs through everything you do
Remember that customers want to know you have a physical presence even though you may meet them more frequently in a digital world
Be prepared to close, relocate and resize your physical offer
Aim to be Omni-channel - create experiences in physical and digital that link together and compliment one another. Empower you customers to bank with you wherever, whenever and however they want to