As I made the short drive to work today, I counted no fewer than six bank branches under construction. It's only a five-minute drive from my house to the office. And I wasn't even paying that close of attention...
[Most of these, by the way, are going on corners where gas stations once sat. But that's another story.]
So I began wondering what's spurring the bank-branch boom. A quick Google search turned up a story on the subject from the NY Times that ran in April 2007. According to the article:
"It turns out that when it comes to their money, many people still prefer the human touch."
Within the same search, another story turned up, also from the NYT, explaining the boom. According to the article:
"The rush into retail banking reflects a fundamental shift by the industry. A decade ago, most big banks were shedding their branches, not building more. They steered their customers away from teller lines and encouraged them to use cash machines and telephone banking services, which were less expensive to operate. And many had grand visions of Internet banking, even if consumer-friendly technology had not yet arrived.
Today, there has been a serious change of mind. Banks view their branches as gold mines, not costs. Their checking accounts can generate a steady stream of fee income. Their tellers can sign customers up for new products, spurring overall sales. All the while, branches can collect millions in cheap deposits that can be lent out at higher rates. Even as they offer options like online banking and kiosks in convenience stores, banks still hope to lure customers inside a physical branch."
It highlights the importance of personally engaging customers and why having employees who personify your brand is so critical. As described in these articles, banks are going neighborhood to neighborhood, block to block, in an effort to reach and connect with consumers.
In our work for our clients at the store level, from beer to bags of chips, deodorant to dog food, having a well-trained ambassador for your brand at the point of sale can translate into significant sales gains.
Banks understand this. It will be interesting to see whether other industries follow suit.
-- CA