Innovative technology will keep bank branches central to the customer experience.
Customers tell a similar story. If their local branch closed, 43 percent would simply go to another branch. Only 16 percent would actually switch to a different banking channel.3
In fact, many banks believe that branches are the best way to attract new customers and cross-sell or upsell existing ones. Yet today’s customers can handle banking activities in a variety of ways, from mobile apps to non-bank, digital-only alternatives. To keep the branch relevant, and to continue to realize a return on their branch investments, banks will need to invest in new strategies and technologies.
From Technology to Transformation
While branches provide a powerful connection to customers, they cost banks plenty. A typical branch costs $2 million to $4 million to open and $200,000 to $400,000 a year to operate.5 And that investment doesn’t necessarily ensure that branches are benefitting from the latest technology — and ongoing management of that technology.
Reliable, cost-effective strategies for launching, refreshing and managing branch IT are crucial to branch success. When refreshing existing branches or opening new ones, savvy banks are looking to add several key technologies:
- Cardless and e-ATMs — ATMs are a branch staple, but banks now seek to enhance the ATM experience. Some are deploying cardless ATMs that customers can access with their smartphones, improving both security and convenience. Others are going further with e-ATMs that offer services that in the past were provided by a teller. Customers can withdraw large sums in specific denominations, make deposits, pay bills and more.
- Digital signage — Banks will increasingly deploy advanced signage and video walls to market products and deliver services. Digital signs can be controlled throughout all branches from a central location. They can also offer interactive features that allow customers to open accounts, access online accounts, view transfers, pay bills, calculate loans and schedule meetings with bank staff.
- Video — Two-way video conferencing can allow customers to interact with bank staff at kiosks and drive-through windows. Staff can be located onsite or remotely. The approach frees up floor space and allows bank representatives to serve more customers with less downtime.
- Internet of Things (IoT) — IoT brings a broad range of benefits to branches. IoT beacons can recognize customer smartphones to track how customers move through the branch and consume services, and to deliver personalized messages and experiences through digital signage, kiosks and video tellers. IoT sensors and connections can also allow branches to manage HVAC, lighting, cameras and security from a central location.
- Mobile tools — As branches allow for more customer self-service, banks will free up staff to move around the branch, empowered by mobile tools. Equipped with tablets, bank representatives can assist customers with self-service and cross-sell products while remaining connected with core bank systems and customer relationship management tools.
Banks can optimize their investment in mobile tools through end-user personas. Personas describe groups of end users that have similar IT needs based on their roles, work styles and workspaces. The approach allows banks to achieve an effective balance between end-user enablement and IT control, while giving branch employees the technology they need to deliver superior customer service.
Help Yourself, Help Your Customer
Many of the technologies banks will deploy in the branch are focused on enabling customer self-service. (See Figure 2.) It’s not surprising, then, that the number of bank tellers will decline by 8 percent between 2014 and 2024.6
And customer experience is key. Digital-savvy customers in particular are less interested in the number of branches than they are in an exceptional overall experience. (See Figure 3.)
1 “Say Goodbye to Your Neighborhood Bank Branch,” The Washington Post, April 2016
2 “The Need for Speed: 2016 Banking Industry Outlook Survey,” KPMG, 2016
3 “Say Goodbye to Your Neighborhood Bank Branch,” The Washington Post, April 2016
4 “The Need for Speed: 2016 Banking Industry Outlook Survey,” KPMG, 2016
5 “U.S. Banks Want to Cut Branches, but Customers Keep Coming,” Reuters, August 2016
6 U.S. Department of Labor data
7 “The Need for Speed: 2016 Banking Industry Outlook Survey,” KPMG, 2016
8 “The Relevance Challenge: What Retail Banks Must Do to Remain in the Game,” EY, 2016
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