Over the past few years newspapers have been filled with articles announcing new bank branch closures, but earlier this month there was a new twist. Lloyds announced they would be turning some of their branches into “micro branches” with two staff and self-service machines and a smaller square footage.
Is this hybrid combination the future of the bank branch?
Is it time to ditch the bank branch complete?
Absolutely not! A recent survey on Money Saving Expert looking at the last time people used their bank branch showed that across all generations there is a still a strong group of regular users of bricks and mortar branches. A fifth of respondents under 25 had used a bank branch within the last week.
However, the impact of technology on the banking industry is undeniable. It’s made paying in cash quicker, getting out cash easier than ever and speed up the time it takes to get simple banking actions done. Overall there have been benefits for customers and banks.
Banks need to strike a delicate balance between customer autonomy and personalised support and advice, maintaining the human interaction that helps generate loyalty and trust is vital.
So, what might this look like? The hybrid approach we’re now seeing adopted by Lloyds definitely seems to be one of the most appealing to customers.
This certainly poses technological and marketing challenges for banks – can your self-service machines keep up to date with service demands? Is your solution scalable enough to adapt to the new environment? Which software and hardware will you deploy to make sure that your staff in the branch are empowered to help customers?
From a marketing point of view, the level of service must be consistent across all your channels – this is about adapting to customer needs not reducing the level of service they receive.
Staff aren’t glorified receptionists
People like people. Having staff in your branch is about generating trust and helping customers. They are more than glorified receptionists pointing people towards the nearest machine.
But to help staff make most of this new branch model, banks must empower staff with the most powerful tools and information.
Most banks are already bringing technology such as tablets into branches to help staff, but they can do so much more. Real time information means that status information on self-service hardware, customer history and relevant sales opportunities can be combined into a powerful tool for your employees.
Get inspiration from Europe
British banks could look to Europe for inspiration on how to revamp the branch. Italy’s Cariparma (part of Credit Agricole’s Group) has rolled out a new branch format which embraces Assisted Self Service devices but instead of closing off unused space, the bank has created lounge areas for customers, private meeting areas, and spaces for community events and meetings.
The bank branch is changing. While their numbers might drop, and the form they take might change, the demand for a physical branch presence is here to stay. There are opportunities for banks and customers, but the key is striking a balance between the physical and the digital.