Like companies in many industries, financial institutions are under pressure to chart a new course by reshaping their business models to compete in a world of changing customer expectations.  There is a small window of opportunity to respond to this shift within the market and banks are in the throes of making companywide changes to ensure they are continuing to satisfy their customers whilst operating in an economically viable manner.

In order to remain competitive and relevant within the industry, banks across the UK and Ireland are going beyond simply updating their services and are taking a step back to re-evaluate their entire customer offering. Delivering a seamless end-user experience is vital and the branch network plays a key role in achieving this. With this in mind, banks are re-assessing their end-to-end branch strategy, focusing on finding the optimum branch network mix. From flagship branches that have the latest technologies to points of presence branches that offer speed and convenience – banks should be considering all of these branch types and everything in between.

Recreating the right branch mix

New technology is dramatically changing the way banks operate, offering automation and improvements to many banking processes. As a result, in-branch technology is becoming an enabler for new services and processes and is allowing banks to create new customer journeys which are more closely aligned with the needs of today’s banking consumer.

Increasingly, banks are taking an overarching view about how they can satisfy customers via omnichannel services - combining digital and physical channels. With branches continuing to form an important part of the overall customer offering, it is more important than ever that financial institutions deliver the correct mix of branch formats in the right locations.

Traditionally high street branches fulfilled most banking needs, but with the rise of digital this is changing. Choice and convenience are crucial and the customer now has the power to complete banking transactions in flexible ways we haven’t seen before. Banks need to be considering how they can take their services to the customer rather than relying on how banking processes have operated historically.

By mapping demographics with customer and market intelligence, banks can now realign their physical assets to where the people are. This means that when we talk about the branch network of the future, it may look quite different to the branch network we are currently all familiar with.  

At one end of the scale, there will always be a need for flagship and high street branches that showcase the latest technology innovations and focus on offering a premium, personalised customer service. These branches will typically be located within towns and cities where footfall is at its heaviest.

At the other end of the scale, financial institutions should be thinking about taking banking services to customers in more convenient locations. Streamlined operations and advances in automated technology mean that flexible banking can be offered to customers through pop-up branches in supermarkets and shopping centres or even via drive-up ATMs. In this new type of branch, customers will primarily self-serve. The focus should be on providing the ability to complete quick and efficient transactions in convenient locations, at times which suit the customer.

Redefining the customer journey

It’s imperative that banks start with their strategic objectives and evaluate how they can create the optimum branch network to achieve these objectives. Considering staff, customer and cash journeys together will ensure that future plans are effective, efficient and future proof. 

When deciding on the right mix of branch types banks should evaluate the services customers are likely to demand in each location. Is it a personalised service where they can access one-to-one services from staff? Or is it a routine transactions where speed and convenience are the prevailing factors? Once banks have decided on the right mix of branch types in the right locations they can use customer mapping to make informed decisions about branch design, technology, infrastructure and staffing.

It’s clear from emerging trends that bricks and mortar locations will continue to have a critical role to play in the omnichannel offering for financial services for the foreseeable future. By delivering the right services in the right locations, banks can offer the best customer service possible whilst operating a sustainable branch network for the future. Digital has taken banking to the customer and now it’s important the branch network does the same. Watch this space for more bank branch formats at a location near you.