Customers are channel omnivores, consuming bank products and services in many ways. They visit physical branches and ATMs. They pay bills, transfer funds and deposit checks electronically using computers, smartphones and tablets.
Many customers do several of the above in a single month.
While generational differences impact channel usage, customer demographics don't tell the entire customer channel story, particularly when it comes to branch visits. It's intuitive that seniors are more likely to visit a branch than Generation Y, but in reality, it is not by that far a margin. Seven out of 10 Gen Y and eight out of 10 Gen X consumers visit a branch each month.
The biggest determinant for branch channel usage isn't age but whether or not a customer uses mobile deposit: Just 50% of mobile deposit users visit a branch monthly, versus 77% of consumers overall.
THE BRANCH WILL CHANGE
Even if physical branch traffic decreases due to technology such as mobile deposit, the branch is here to stay. Some customers will continue to prefer the branch and others will use online and mobile banking for routine transactions and visit branches to discuss big financial decisions with branch staff face-to-face.
However, because branches represent 66% of the noninterest expense for the average financial institution, banks need to use these branches more effectively or they will become a drain on profits. "By incorporating technology, a financial institution can transform the branch experience and maximize the value of its brick and mortar footprint," says Jaime Dominguez, director of strategy for Bank Solutions at Fiserv. "Rather than a staid physical location that offers the same transactions that customers can self-service on their tablet or smartphone, the branch becomes a valuable component of the overall customer experience."
Customers are increasingly reliant on their mobile devices for a variety of daily activities. According to Fiserv consumer research, more than half of tablet owners use their devices for banking. And even when they do visit a branch for financial advice or complex transactions, these customers still expect to use technology.
Perhaps the technology best suited to transform the customer experience in the branch is the visually appealing and intuitive tablet.
Tablets can improve the customer experience at the branch in many ways, particularly in sales engagement. Branch personnel can use tablets instead of brochures or slideshow presentations to provide consultative content such as return-on-investment and pricing calculations customized for each customer. Graphics and interactive tools make the experience fun and more interesting, and engage customers as never before.
Imagine a customer enters a branch to apply for a mortgage. He walks over to a welcome area equipped with several tablets. The customer taps a mortgage icon and inputs information such as term of the loan and amount to interactively compare monthly payments and total interest paid. He can even watch a short video describing loan types. If the customer has questions, the branch employee can act in an advisory role using the bank's sales tools available on the tablet.
If the customer makes a buying decision, the branch employee helps the customer complete the mortgage application on the tablet, including capturing an electronic signature. The loan is immediately submitted for approval and there's no printing of hard copies. The customer receives an email or text confirmation that the loan application was submitted.
Equipped with tablets, branch employees are no longer chained to the teller line or the platform (or even the branch itself). Instead, these portable devices encourage employees to physically engage with customers, demonstrating products, offering financial advice, opening accounts or helping them complete a transaction. This shoulder-to-shoulder interaction is much more personal and collaborative than the traditional across-the-desk experience.
For those banks that cross-train employees to serve in teller and customer service roles, a tablet allows employees to easily transition between roles and engage in conversations about products and services such as wealth management or lending with a tap and a swipe.
THE NEXT STEP
"It's not enough to simply equip branch employees with tablets. Instead, financial institutions must customize the experience at each location based on their customer base. Analyzing customer data allows the financial institution to better understand its customers and their channel preferences, allowing it to use technology to create an experience that will resonate with their target customers," says Dominguez.
Branches are relevant to today's mobile-device enabled consumer, and financial institutions have an opportunity to leverage their branches as a differentiator from their competitors. The key is to use technology to create a modern, re-envisioned branch that supports the financial institution's other delivery channels and enhances the brand, deepens customer relationships and drives new business.