Transforming banking experience through a symbiotic brick and click relationship

Banks have come a long way from their early branch-heavy days to the new age of ‘anywhere, anytime’ banking. The onslaught of internet and mobile banking is throwing doubt on the continued relevance and feasibility of the branch. Couple this with the high operational and maintenance costs of the branch, and it raises the question of whether we are going to see branch-banking’s final obituary in the next few years? Or do branches have within them the ability to add more value to consumers’ banking experience? Will internet and mobile banking actually come the rescue of an ailing platform?

According to a recent survey of its customers by TSB, 34% of those polled indicated a convenient branch location as one of the top reasons for switching to a new bank. According to TSB’s research, 88% of bank accounts are opened in the branch, while 71% of personal loans and 85% of mortgage applications still take place in whole or part in a branch. This clearly shows the importance of the bank branch, and is a far cry from the bleak picture which is often painted.

Digital disruption and more tech savvy customers are putting pressure on banks to reexamine the way they service consumers. The core challenge for banks is in how to build a seamless consumer experience through a ‘brick and click’ model. For branches to thrive, it is important to effectively complement the branch with other channels and ensure an advanced banking experience for users. Banks must deliver a multi-channel experience that gives the branch a smarter role and adds value to transactions.

Digital and mobile channels have increased the number of consumers’ touch points with banks, which in turn throws up many opportunities to cross-sell and upsell. Where does a bank branch fit in to this model? For high-value products and services such as mortgages and car loans, the importance of an in-person interaction is second to none. This is where a reimagined bank branch can evolve to play a crucial role in strengthening relationships with customers. The models that future bank branching may adopt, include:

  • Hub and spoke model: In this model, the hub branch will provide a full range of tailored services and products; the spoke branch would cater to smaller, generic and more regular transactions. For any additional needs, the spoke branch would redirect the customer to the hub branch.
  • Technology driven model: Technology driven model: Here, the customers’ major interaction and engagement with the bank, on entering the branch, will be through technology such as kiosks and tablets. These branches will operate with little or no staff.

For a bank to survive and succeed, it needs to create compelling experiences for its customers. For this to happen, both digital and physical channels will need to offer a symbiotic and powerful relationship to better serve customers.

The article was originally published on The Digital Banking Club on October 21, 2014 and is re-posted here by permission.