Repurposing Your Branch to Create Engagement

I recently had the pleasure of visiting multiple FNBB customer institutions in the central Florida area.? Nothing beats having direct contact with bankers and discussing the challenges our industry faces and how we might innovatively tackle them.? Each of the four banks I visited, on a beautiful Wednesday, were unique in that their markets and strategic focus were all different.? Yet, the one thing I noticed in all four visits was there was not much activity occurring in the retail part of the branch. These were all beautifully appointed spaces, inviting, yet, not at all busy.

Now, I want to make sure you understand I am not offering a critique to these banks (or any bank for that matter) for the lack of customer activity.? Our ability to provide a robust out-of-branch experience, greatly enhanced throughout the pandemic years, now makes a bank branch visit much less necessary.? And that is a good thing.? But if transaction activity which is the focus of almost every branch is less needed, then instead of a lot of dead activity on most days, why not rethink the very purpose of the branch?? If you were going to make a branch visit something other than a transaction (including the opening of a new account…), what would that focus be?

For me, it has to be customer/prospect engagement. Rethink why someone would want to come to the branch. My thinking on this was augmented by a couple of recent articles that I believe add value to this narrative.? First is an article about TD Bank converting a 6,000-square-foot branch to add a specific innovation space. Interestingly, it came about by their technology team inquiring on how they could get existing customer input on new digital banking offerings they were planning to launch.? They wanted to test out new options for mobile banking with actual customers and get their feedback in a live environment.? As it turns out, creating an innovation space within the branch is exactly what they needed. Any customer who happened to be in the branch for any reason could see that there was an opportunity to see new mobile banking features and offer their feedback. The bank was able to promote this opportunity via social media to their tech-forward customers, asking them specifically to come in to get advanced access to the next online banking/mobile banking release and offer their opinions.? If I got that message from my bank, you can be sure I would be setting up a specific time on my calendar to make that branch visit as soon as possible.

Another article was focused on the strategy of PNC bank regarding its branches. PNC is opening 100 new branches through 2028, targeting certain strategic markets. At the same time, they are targeting 1200 existing branches for renovations, with the end goal of making these branches more oriented to engagement elements. According to Jeff Martinez, EVP and head of branch banking, PNC will focus the new and renovated branches on “Centers of Advice,” utilizing automation to handle transactions and focusing on human interaction for consultation selling, education, and problem-solving. Once the 1200 branches have been upgraded, it will mean that 2,000 of PNCs branches have been upgraded from a transaction to engagement focus.

Why should you care what large FIs are doing with their branches?? First, larger FIs have invested hugely in their digital platforms, and surveys show that the features they have added are highly rated by their customers, especially younger customers.? But rather than just wholesale close branches and focus on digital, these large FI competitors know that the bank branch is a strategic asset, it’s just not needed for transactions.? Community banks are in the best position to rapidly convert their much smaller branch network to an engagement focus and get out ahead of the larger competitors.

What is your strategy for making your branches a destination for customers and prospects?? Let me know what you think, email me at [email protected] and share your hopes, dreams, successes or failures.? Remember, innovation never happens unless failure is an option, so we must move away from traditional thinking on the purpose of a branch and focus on the activities to attract tomorrow’s customers.