COVID-19 has given banks a once in a lifetime opportunity to pioneer new ways of working and adapt to the changing behaviours of their customers. One such opportunity is to better harmonise the digital and human interactions within their retail branches. As customers expect digital access to products and services around the clock, banks’ branch networks need to swiftly adapt.
Adapting successfully will mean re-imagining the customer journey and adopting a more customer-centric multichannel engagement model that provides customers with seamless on- and off-line experiences for purchasing products or interacting with their bank.
Today, customers expect their banking experience to be consistent, whether they’re calling, going online, using an app, or visiting a branch. For example, if they start an interaction in branch, they expect to be able to finish it at home, or vice versa.
In 2020, more people are staying at home and traveling less, and half of the UK workforce is expected to continue working remotely. So, there will be greater demand for local services, including bank branches, as people work closer to home or at home. At the same time, due to social distancing and the awareness of disease vulnerability, consumers who previously visited branches regularly may no longer wish to do so.
Banks need to analyse what these changing volumes will mean for their branches. Some might disappear due to lack of demand. Others will see a resurgence. Those that remain will need to evolve to become sophisticated regional hubs that blend digital and human interactions, provide training facilities for both staff and customers, and include local contact centres. As well as supporting the local customer base, these hubs could be an opportunity for banks to make back office operations and call centres local, reducing costs significantly and enabling a more flexible workforce.
Most branches today aren’t fit to deliver a seamless experience across digital and physical channels. But studies show that effectively combining human and digital interactions and self-service functionality can increase bank revenue up to 15 per cent, reduce branch costs by up to 35 per cent and increase customer satisfaction by 15 per cent.
Imagine a world where retail bank branches are fully digital – more like an Apple or Argos store with open spaces, tablets and smart deposit machines instead of traditional counters. You might be able to get a coffee and chat with branch advisors in a community space as well, like in a Capital One café, where customers can connect with “café coaches”, onsite banking representatives who are available to chat over a coffee about different banking products and enjoy café food and free Wi-Fi. Upstairs, for the bank employees, there might be a call centre, back office functions, wealth advisory centres and regional hot desks bringing cross-trained colleagues together across all products and offerings.
Of course, people still favour human interactions for complex or critical interactions, such as applying for a mortgage or opening accounts. Human interactions in branches are likely to influence customer satisfaction more than online or mobile channels. So, branches need to focus their human resource on these differentiating services that drive customer engagement, satisfaction and retention while building a digital in-branch experience for simpler transactions.
As the UK’s route out of COVID-19 recession is unclear, more people are likely to experience financial hardship, so we could see an increasing demand for in-person financial advice. As this happens, bank branches could become ‘Relationship Hubs’ that herald a new era of relationship-based banking.
Typically, the biggest driver of customer satisfaction within UK students is not digital experience or overdraft fees, it is their branch experience. Given the declining number of bank branches, those that remain have an even bigger opportunity to play an active role in creating a sense of community in their area.
To achieve this vision, banking hall teams need training in how to use the technology available to help customers with their complex queries and decisions and chart a new financial path forward. This upskilling should also ensure branch colleagues can use introductory calls with customers to educate them on the how to use technology to complete necessary pre-work before a branch visit. For example, people can do most of a mortgage application online, letting the branch visit focus on answering questions and discussing additional products, such as life insurance, instead of administrative processes.
As banks navigate towards an uncertain future, their approach to branch networks needs to shift from short-term pandemic responses to a digital- and technology-enabled evolution.
In a post-COVID-19 world, there will be significant upsides to maintaining a local branch network. But it should look and feel very different to today. Banks must leverage digital to drive simple interactions online and re-imagine the retail branch with the digital customer journey at the heart. Cross-channel enablers that harness the right mix of human interaction with technology will ensure they remain trusted partners for their customers.