Reader Question One
We have ATMs at all of our branches. As long as we have an ATM at each branch, does it matter where at that branch it is located? Is there any reason we should try to have some sort of consistency of ATM placement across all branches, or is it good to have a mix of walk-up, drive-up, and lobby ATMs?
The DEI Design Team,
When deciding where to place an ATM take into consideration whether it is lease space or a free-standing facility and the positioning of the facility within the market to be served. Leased space, many times, will dictate either a lobby or walk-up ATM. If the facility is positioned to serve a major SEG, within close proximity of the SEG office, this may also dictate a walk-up versus drive-up. If the facility is in a more retail/residential location, then the overall demographic characteristics and competitive environment come into play regarding the best ATM positioning.
The location of an ATM may also depend on site conditions, zoning and planning issues. Drive-up ATM's are more user-friendly in areas with several months of inclement weather versus a warmer climate where land could be more costly. Through our years of observation, we have seen that typically people pass by an ATM at a branch entry way when they can receive personalized service by a teller.
Paul Siebert, EVP Financial Planning and Design, EHS Design, Seattle
Correct ATM placement at branches is key to driving ATM productivity. We have studied ATM usage at branches with matching facility, demographic, traffic, visibility and accessibility characteristics and found significant differences in performance. An ATM with high street visibility will typically see twice the usage of an ATM hidden behind or to the blind side of a branch. Drive-up ATMS often experience 25% to 50% more transactions than walk-up if well located. Additionally, most credit union locations do not provide adequate signage to compete with other institution's ATMs. A lighted "24 Hour ATM" sign should be highly visible from the street.
If an ATM is located in the lobby of a branch, the expectation should be that this is used as an alternative to tellers. If located in a branch with tellers, volume is typically extremely low. Also, a credit union looses the benefit of foreign transactions and the opportunity to expose non-member ATM users to the benefits of credit union membership.
From the standpoint of ATM productivity at each branch site, the answer is no as the ATM should be placed for the highest visibility and accessibility. From the standpoint of developing a consistent branch business model and the related operations standards, the answer is yes. ATMs are a key delivery and communications component of every branch. They should be positioned in a standard branch business model to support the overall branch delivery strategy and help insure a rich member experience, enhance the brand image and operating, service and security requirements. Once the location is defined in the branch prototype, exceptions can be made based on specific site conditions.
The application of ATMs should match each branch location opportunity rather than be mixed up among branches. If drive-up ATMs are a competitive differentiator, then drive-up ATMs should be located at every branch where possible or freestanding ATMs located on pads in high traffic retail areas.
ATMs are more than just a way to provide convenience to members. They are an effective method of communicating with potential new members in target markets, generate income, provide a large sign with a reward for using (cash), provide market introduction at a reasonably low cost and can be used in the transition of a lending or insurance office to a future branch. ATMs should be part of every credit union's delivery strategy in some form.
Bill Dean, VP-business administration, NewGround, Chesterfield, Mo.
Branching, by itself, is a strategic decision that all credit unions have to make related to member servicing and how to optimally provide those critical services that are prevalent in all financial institutions; namely, paying and receiving functions. SEG-based credit unions have to be more aware of their primary membership and locate in market areas dictated by travel and site factors, compared to community-based credit union, which needs to be located in a more retail corridor or destination center, similar to banks.
In either case, the credit union has to determine its approach to member servicing from a pure transaction standpoint and the "cost-benefit" realities of providing this commodity service to the member. If the credit union is locating in a purely transaction-driven marketplace, then we would recommend using only drive-up ATM's for the following reasons:
* 24-7 access with better security for members to conduct this service
* Convenience for members to not have to leave their vehicles
* Walk-up or vestibule ATM's are not as viable due to potential risk of robbery and making members leave their vehicles.
If the credit union is interested in relationship and profit-based product growth, then retailing design and member interaction forces ATMs out of the branch space to the drive-through islands.
NewGround would suggest that credit unions offer ATM drive-up service on the outside lane of the drive-through configuration at each location for consistency. This function is not a business driver either for profitability or member relationship-building.
Connie Lyle, Will Klein, KDA Holdings, Atlanta
The location of an ATM at a branch is-in part-a function of the credit union's own strategy. Some have them in the lobby to handle overflow from the teller line or to intercept transactions before they reach the tellers. At other institutions the strategy is to provide a vehicle for transaction service 24/7 - an extension of the branch's typical 8/5. Besides the extended hours offered by an external ATM, such a location offers the credit union an opportunity to earn fee income if it is part of an ATM network. Typically, unless there is an over-riding reason the credit union has for locating an ATM inside, KDA recommends the location be external, either at a drive-up location or in a 24-hour lobby protected by a card-swipe activated lock. Either one should be visible from the main street on which the branch is located. If the market is primarily young families, the institution should lean toward the drive-up as it lessens the need to take the children out of the car in order to use the ATM. Where cold weather is a factor, an ATM in a vestibule is a good solution. The key is 24-hour secure access, whether staying in the car or entering an enclosure. Ultimately, it's about the members and how best to serve them.
Ralph La Macchia, The La Macchia Group, Milwaukee
We have designed and built facilities that incorporate all three types of ATMs, and singularly apply each of them. When placing ATMs, we have found that it is important to determine the type of traffic your facility will draw. An in-line or in-store branch would attract a great deal of pedestrian traffic, thus making a walk-up ATM sensible. A drive-up ATM might be more appropriate for a free-standing facility, because more often people will be driving to that facility. Further, security also makes a drive-up ATM more popular.
There are two types of ATMs that could be applied in a lobby. One type might be in the vestibule, which could be accessed by a card or open to anyone, and would allow for after-hours service. Another type is an ATM in the actual lobby of the credit union. This type of ATM allows you to close off your teller line while still providing cash dispensing services. The placement of the ATM can also attract non-member users, which could generate fees if desired.
Consistent placement of ATMs throughout your branch network needs to be driven by the layout and physical architecture of those branches. If all of the branches are the same and you have many of them, it is helpful to design them all with the same entry sequences and adjacencies in mind. However, drive-up ATMs far surpass walk-up usage in general.
Jim Caliendo, president, PWCampbell, Pittsburgh
Location of ATMs is absolutely critical, especially if the design of each facility is tailored to the property and its surroundings. We absolutely recommend the consistency of how an ATM looks on the outside, how it finishes the outside design and invites a member to process their transactions. Where consistency comes into play for ATMs is not necessarily in the exact placement at all locations, but it's more about how the location of it fits into the overall practical design and visual space.
Location of an ATM is based on what space is available in the branch from a design standpoint, and from a site standpoint on how you can ease traffic flow. ATMs of a drive-up nature in credit union facilities are popular and have become a standard of member-friendly service, without the human interaction. However, if there is motivation to move transactions into a lobby area, then there is a rational reason for adding an in-lobby ATM. This becomes a matter of member-marketing and space.
Walk-ups are becoming a thing of the past; in fact, they have become relegated to mall or kiosk areas in the branches.