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A community bank in Massachusetts has opened a branch that's a microcosm of forward-looking trends in retail bank design. Emphasis on the "micro" part.
October 15 -
The nation's fourth-largest bank has opened another mini-branch in hip Washington, D.C., neighborhood teeming with young professionals. Is this the prototype for the urban branch of the future?
May 6 -
Financial institutions need to have good digital offerings, but they also need to find ways to stand out from the crowd. That's why branches will remain a crucial home base.
January 8 -
While bankers' reputation as the unquestioned authorities on financial services may be changing, the importance of face-to-face interactions has not lessened, according to contributor Dave Martin.
August 6
Today's community bankers have no choice but to embrace the world of mobile technology. But most cannot expect to win their battles for market share there.
Many bankers receive mixed messages about this issue, as I was reminded in a recent exchange with a community bank board director. "I get your thoughts on the importance of keeping our people at the center of relationships with customers and shaking hands and kissing babies and all of that," he said. "But that contradicts what others are telling us we need to do to serve millennials and these new generations who want to do everything on their smartphones."
I jokingly suggested, "It's only confusing until you realize that those other guys are wrong."
I was (mostly) kidding. I would never argue that "shaking hands and kissing babies" somehow insulates bankers from the need to deliver services to customers through their preferred methods and channels.
But if community bankers allow financial institutions' value to be defined primarily by the technologies they provide, they'll be playing on someone else's home field each and every day.
I'm happy when I read the occasional article about a smaller institution rolling out some new app or technology ahead of the "big guys." But is staying ahead of the pack on technology something most small banks can do? I'd respectfully suggest it's not likely.
Moreover, bigger brands and online-only operators are far more likely to be perceived as having best-in-class technologies whether or not that is objectively true. All this is to say that even if small banks manage to roll out superior new technology, others will copy or improve upon it in short order.
Much to the dismay of those who like to proclaim the death of the branch, most bankers recognize that maintaining a physical presence in their markets is critical to their ability to continue building strong relationships with their customers. Smart people on both sides will debate how "over-branched" individual institutions are, but most seem to see the need for a continued physical presence.
The more important point is that there is a difference between having a branch presence and running the kind of branches banks need to be competitive going forward.
Naturally, banks must think carefully about the size and design of their branches. It's a pretty safe bet that future branches will not require the same amount of space for the mountains of paper transactions that our legacy brick-and-mortar "financial services factories" required.
Smaller and more efficient locations will proliferate, since they will be better positioned to reach people where they work, shop, and play.
This change is about more than convenience. After all, a growing portion of the population now relies on remote banking, which is indisputably convenient.
Rather, the locations of these smaller branches can help banks increase the number of actual human interactions they have with existing and potential customers. The way to keep our people at the center of banking relationships is to put bankers in places where they can still see people and yes, shake hands and kiss babies (at least metaphorically).
I'm a little amused by the way some in our business refer to millennials and other young generations as if they are from another planet. Sure, people who look at that square piece of technology in their pockets as a joint work-entertainment system that also happens to make phone calls may have different world outlooks than their parents.
But they're more like older generations than some give them credit for. They like people who are nice to them and their kids. They like hearing compliments. They like telling bankers about themselves. They like people and organizations that visibly support the communities they live in. And most importantly, young people still form actual relationships with other people, not with technology.
Technology is simply a tool. The tool that customers will choose to use depends on us. And whether our employees will be in a position to build relationships with new and old generations alike depends on us as well.
Dave Martin is an executive vice president and chief development officer at Financial Supermarkets Inc., a Market Contractors subsidiary that offers design, construction, consulting and training services for retail banking programs. He can be reached at
