The trend is clear: customers increasingly prefer virtual service, which is pushing banks to rethink the role of the physical branch
As digital banking advances, some questions have remained unanswered. Like: What will happen to physical branches? What role will they play in the digital context? How should a bank add them to the omnichannel strategy? Especially, when today customers prefer communication channels such as WhatsApp or Facebook Messenger.
In the midst of the pandemic, the rise of digital services led banks to look for ways to offer more human connections in virtual environments. In this context, user experience (UX) became a powerful differentiator, which strengthened in importance, attracting more users to digital channels.
This quickly led to branch closures. In the United States, for example, branches are closing four times faster than they are opening according to S&P Global Market Intelligence. In Spain, 33.4% of branches have closed in the last five years, according to data from the Bank of Spain.
But while there are neobanks that have been born completely digital, dispensing with branches and attracting a critical mass of customers, the traditional industry is not ready to abandon its physical channels, given the need for audiences that require preferential and face-to-face attention, such as seniors and other less-digitized groups.
With them in mind, branches must be reconfigured, placing the user at the center of the strategy, building spaces that invite interaction and become ideal meeting points for financial education, with an emphasis on digital.
The solution lies not only in how to provide affordable services and products to the general public, but also in imparting knowledge so that users can improve their financial management and make better long-term decisions.
Omnichannel strategies in banking are not just about boosting sales. They also create meeting points to provide knowledge and contribute to customer education, thus impacting the relationship with their trusted institution.
In the digital world, banking strategies have focused on developing a clear and simple language, fine-tuning their form of communication to practicality and immediacy. In this way, the "digital banking language" has become (or is on its way to becoming) more efficient, transparent and even automated.
There are lessons there that can be transferred to the physical world, especially considering that most sales or reports, whether at the branch or over the phone, still involve human interaction.
And the fact is that while business trends are currently focusing on the digital consumer experience, as McKinsey points out, customers still value the "personal touch". In fact, even those who favor banking through an app often prefer face-to-face interactions for complex financial products, this study asserts.
What better way to leverage these face-to-face spaces to provide personalized advice in pursuit of the demands of the greatest asset banks have: their customers.
Of course, physical space should not be exempt from digital tools. On the contrary, the branch should be equipped with screens, various devices and advisors specialized in the organization's digital channels, who are ready to help customers make the most of online banking.
As an example, some banks in Europe responded to the demand for advice on a complex product such as mortgages. They trained their staff to focus on a specific niche market: their younger customers.
Contrary to what you might think, not all younger customers prioritize the digital channel. This is why staff preparation was for both virtual and face-to-face support. As a result, 40% of the meetings were held remotely and the remainder in person.
Not only does this account for channel preference (and what can be achieved if we know how to leverage a physical branch), it also sheds light on what can be achieved by leveraging granular, quantitative and qualitative data, both in offices and on screens.
For example, ADL Digital Lab, the innovation hub of Colombia's largest financial conglomerate Aval, uses AI-enabled cameras in some of its branches to analyze users' emotions and reactions, as well as studying telephone interactions.
Its intention is to gather information on preferences – information that transcends transaction data – in order to increase customer satisfaction by providing them with a relevant product offer at the ideal moment.
In this sense, the power of omnichannel brings with it the opportunity to observe the hybrid journey that jumps between the digital wallet, the app or the store. Therefore, entities should aim for real or virtual environments, but always warm and human.
An entity that is leading this type of experience in Latin America and the world is Banco Santander, which started with the proposal in 2016, and since then has not stopped.
For some years now, Santander has been setting up “Work Cafés”, strategically located in major cities around the world such as New York, Buenos Aires, Santiago de Chile and Madrid.
These relaxed spaces, composed of work and private meeting rooms, offer banking services, access to a variety of specialists, 24/7 ATMs and even digital banking islands.
This overhaul of branches moves away from the traditional model centered on a teller line, waiting rooms and restrictions on the use of mobile devices for security reasons. Instead, they become meeting places where users can learn about procedures, such as credit applications or investment products, while enjoying a cup of coffee and working in coworking mode.
With the implementation of these initiatives, we see how physical branches still have relevance in the search for more human interactions in the financial context, providing opportunities to educate customers and improve their experience with banking. Innovation is not always merely digital, but responds, above all, to a simple, agile and close communication in any service channel.
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