Leaning Local: ‘Brand+Branch’ Strategies for Success

By Gina Bleedorn

What to do with the branch continues to be the focus of much conversation as well as the locus of much consternation for decision-makers in banking. Such is what I called the great conundrum in banking when I presented to the ABA Bank Marketing Conference last fall. The reality is that despite declining traffic, branches put you in the game. In fact, they are the leading driver of market share, and banks that invest in their branch experiences and marketing to support them consistently outperform competitors.

Branches = growth (a.k.a., do what Chase does)

ROI on branch assets is tricky to attribute, but without them you are not in the consideration set of most people.

An Ernst and Young report on building trust in banking found that 82 percent of consumers say the presence of a branch is extremely or very important in choosing who to bank with. Further, physical channel affinity appears to skew younger than anyone predicted, with some reports even finding Gen Z more attached to the branch than millennials and Gen X. Plus, the more valuable the services offered in them, the more powerful a driver they become.

There’s a reason that data-driven Chase has made such a multi-year commitment to investing in branches. From 2014 to 2019, Chase saw everyday branch transactions drop by 49 percent on average, while at the same time deposits per branch realized a 62 percent increase. Their branches were driving deposits, even though people were transacting in them less. Doubling down on branches even through the pandemic paid off in spades, when Chase’s branch deposits more than tripled in new markets they entered.

Branch as influencer

Community banks need the branch channel, but its purpose has changed. Branches used to be the only option for customers. When ATMs came onto the scene, the idea of the physical channel began to change (plus, branches were predicted to die), and digital disruption changed things even more. Realistically, the branch is now more about perception than anything else—driving home a we are here community commitment to compete with the neobanks, fintech firms and big banks.

Today, branches—and their halo effect—drive consideration. Previous thinking about the physical channel was focused on the burden of the branch—like, “What are we going to do with our branches?” Now, branch strategies are targeted toward unleashing their power and potential. Thinking about the value of the physical channel, leveraging the branch for growth is how community institutions can effectively take on megabank technology and scale. It’s not your biggest cost burden. It’s your superpower.

Brand + branches

The halo effect or perceived ubiquity of physical locations allows community banks to begin new relationships where people are—because local still has real power. This is the currency on which your success can grow, with trust-based propositions in banking set to boost incumbent banks’ revenue by 9 percent, according to Accenture. But it’s not just any old branch in any location, is it? It’s the right type of branch experience in the right location. Working together to build trust by leveraging your locality. And to do that, banks need better insights from only relevant data.

Data: Get real-time and relevant

To put banks in the smartest position to use branches to their advantage, several key data inputs are critical for branch-decision making. According to Forrester, “Banks have intimate knowledge of customers’ lives yet fail to capitalize on that data . . . the next decade is all about being insights-driven.” Banks typically focus on their own performance and profitability data, often missing the data metric that matter for growth: market opportunity. And without connecting the data sources, they often don’t have the right framework from which to activate it.

Key datasets include:

  • Market data. This data is largely based on census tracking data and includes everything about income, demographics and large migration trends in and out of area. Important to have, but relatively static. Thus, the need for something more active and actionable.
  • Mobility data. This data is dynamic, relevant and timely. It’s aggregated anonymously from mobile phone intelligence, showing where people are going and what they’re doing at any point in time, as well as key insights into their personas. This is the new insights mecca.
  • Competitor data. This data is widely available from sources such as S&P and the FDIC. It gives insights into where deposits are—tracking the money in the market, and its share among a bank’s competitors, so banks can identify opportunity and their own fair share.
  • Institutional data. A bank’s own data is a rich resource of insights allowing them to make meaningful sense of their own performance, their customers – who they are, what they do and what they need.

For successful return on the branch investment, it’s critical that banks get real-time, relevant data and activate it to make smarter decisions. This is how banks will be able to take meaningful branch actions and craft marketing messages based on customer needs and life stages for maximum impact.

Connecting the most relevant data intelligence to drive smarter, faster decisions ensures that brand, marketing and physical locations all work in tandem for more powerful and profitable futures. Or as McKinsey reports: “Reaching the right audience with the right message at the right moment in their journey.”

Gina Bleedorn is chief experience officer at Adrenaline, a brand experience company specializing in financial services. She also serves as editor-in-chief and publisher of Believe in Banking, a mission-oriented platform bringing together decision-makers, influencers and industry leaders in banking. She has presented at the ABA Bank Marketing Conference.