Investment services: Hi-Tech, Hi-Touch Customer Approach

If a financial institution were to combine the hand-holding personal attention provided by full-service investment brokers with the hands-off, technology-driven brokerage model that Charles Schwab and E-Trade use, it would probably look something like CoreStates Bank's Personal Investments Resource Center (PIRC) in Philadelphia.

The PIRC was built to be a cutting-edge facility, dramatically different from CoreStates' traditional, colonial-styled branches-both in design and mission. Created through a partnership with KnowledgeFlow and Unisys, PIRC is made up of four "zones:" the explore zone, workstation zone, seminar area and Net Worth Cafe, each supplied with various tools like touch screen software that teaches customers about mutual funds, retirement planning and other pressing financial issues. The cafe offers comfortable chairs, free coffee, CNBC on the television and stock quote links. There are two professional investment counselors on-site who provide financial advice, but the twist is they don't actually sell anything. "We've learned that there is a real market for (investment information)," says Rich Lindsay, svp and affluent segment manager. "There are still people confused, intimidated by investments and looking to the bank as a credible provider of that kind of information. ...Our first goal, though, was to use (PIRC) as a functional billboard, to announce that CoreStates is in the investment business."

CoreStates, with assets of $45.5 billion, calls the PIRC strategy its high-tech, high-touch model. Its short-term goal is to create foot traffic into the building. And while acknowledging the great success that Schwab's high-tech, low-touch model has had in recent years, Lindsay believes CoreStates is on the right track. "There is still a huge full- service market out there. Schwab is sort of redefining the strategic trends, but in terms of what customers want today, (full-service firms like) Merrill Lynch (have) still got a much, much bigger segment of the market."

The biggest challenge to generating new product sales from the admittedly costly site is just getting would-be customers through the door, Lindsay says. PIRC uses its fully equipped conference room to draw in investment clubs, hold free weekly seminars on investment topics and even host community events. But still, "getting people to walk in, and walk up and touch a touch screen is still somewhat of an unnatural act."

The bank, consequently, has had to change the way it thinks about drawing people into the site. PIRC marketing is more in the realm of The Gap than a traditional branch, says Lindsay. "Getting people into our stores to talk about investment needs is a different equation than getting people in to cash a check," he says. "What we've got to do is merchandise more like a store and get people there to talk about what their needs are."

In pursuing its customers, CoreStates launched an extranet pilot that allowed them to tap PIRC resources from home. That effort, made in response to focus group interest, has been shelved temporarily as the bank chose not to support it, Lindsay says. But its viability will be reconsidered as the bank also considers opening more PIRCs in other areas.

-sausner tfn.com.

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