This article appeared in the ATM & Financial Self-Service Executive Summary, Winter 2006.
The tried and true brick-and-mortar branch. Fifteen years ago, bankers talked about its disappearance. Today they're talking about savvy designs and services that will pull consumers in rather than push them out.
Bankers are breathing new life into bank branches, and consumers are applauding them for it.
According to the Federal Deposit Insurance Corp. (FDIC), from 1994 to 2003, bank branches in the U.S. increased by 15 percent to almost 67,000. FDIC found, despite consolidation in the industry, that branches remained valuable resources in helping financial institutions generate fee income.
Consumers like using the branch, and FIs are striving to maintain "personal interface" with consumers at the branch, said Bill Raymond, an account executive for Germany-based ATM solutions provider Wincor Nixdorf International.
"There does seem to be a keen interest in keeping the personal interface," he said. "Clearly, the ideal solution is going to vary by financial institution, which makes it important to know what's happening in the branch. What's the traffic? What kind of transactions are customers doing in the branch, etc.?"
Companies like Norcross, Ga.-based IBT are helping FIs come up with strategic branch designs that optimize banking channels from a structural perspective. "We see what's working out there, as far as automation goes, and we bring our experience and forward-thinking to the design," said Carmen Cox, IBT's vice president of marketing. "We call it ‘automation migration.'"
But Raymond said strategic design is only part of the solution
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In order for branches to find true harmony, all banking channels must be integrated.
Raymond said more and more FIs are asking, "How do we make the ATM experience more like the branch experience or the online experience? How do we interact with the customer in a way that is low-cost and supportive — in a way that simplifies and streamlines our time to market?"
The answer: channel integration.
In 2004, Wincor introduced ProClassic/Enterprise — a systemwide solution that allows information to be exchanged between channels. Although much more dynamic and comprehensive than middleware, the solution similarly allows channels speaking different languages to communicate.
When considering branch redesigns, Raymond said all FIs should ensure that they have that kind of communication.
Beyond multichannel communication, FIs also should:
- Describe the present customer experience at the branch. Is the branch delivering the customer experience the FI wants to deliver?
- Is the branch getting the sales and account growth it should?
- Has the FI been able to initiate meaningful conversations with customers in the branch?
- What are the cost dynamics at that branch — cost of cash, teller time, etc.?
"Those are going to be key factors," Raymond said. "You figure out how you want the branch to behave, then you see how the branch really is behaving, and then you move to how to change and improve the branch."
