At this year’s IQPC – Branch Transformation Conference in Singapore, the agenda is mainly focused around one thing – Human centered design across all channels, and the technologies that enable today’s bank branches to move towards this design through customer identification and segmentation.
For example, Hui Hui Li, President of Global Business Management, Deputy GM of Strategic Development, Board of Directors, China HengFeng Bank, kicks off the conference with a presentation on defining the purpose of your branch by understanding your customers and your company’s core values. The presentation explains how to:
– Analyze the unique characteristics of branch customers.
– Perform customer segmentation based on customer preferences such as banking requirements, location, preferred products and services, and historical behavior.
– Identify priorities and purpose for the branch to focus on attracting and serving the most relevant customers.
Similarly, Ibrahim Gailani, Head of Branch Transformation, Oman Arab Bank, talks about the lessons they learned from a 3-year journey of transitioning physical branches into the branches of the future. They are doing everything from layout redesign to furniture selection, from FusionBanking Essence to Smart ATMs.
The newly opened and upgraded branches will deliver a consistent banking experience across all channels. Their new branches have a meet and greet facility with streamlined queuing system, video walls for bank news, private customer service spaces with multimedia screens for a more personal interaction, together with digital signature pads and ID Card readers within the advisory station design. Each new look branch has a separate ‘Elite’ reception, lounge and Elite Relationship Manager office to give premium customers an elegant and private experience.
These are the kind of omnichannel models that banking institutions are moving towards, where customer identification makes segmentation possible, leading to targeting services offerings based on profiles. The video and slide below are excerpts from the presentation that Lucep CEO Kaiesh Vohra gave at the IQPC Branch Transformation Conference.
He explains how siloed the IT systems and teams are for each channel, costing millions of dollars to operate.
“Customers now expect omni-channel engagement and less than 10% of banks have a way to meet this demand. This broken experience has be fixed, or unbundling represents a serious threat.” – Lucep CEO Kaiesh Vohra
The physical bank branch is then one of many channels that a customer can seamlessly switch across, while also being a hub where customers can access services through several different channels.
Sunny Poon, Associate Director, International Branch Head, A Top-Tier Bank in Hong Kong, outlined this in a very clear way in his presentation on how to cater to distinct customer segments through different future branch banking models.
The traditional banking network comprising homogeneous, full-service branches catering to customers across segments is no longer sustainable. Banks should consider a network made up of differentiated branches targeting specific customer segments.
Based on the levels of digitization adopted, and integration of online and offline elements into the physical branch, he explains the four main types of future bank branch models:
The Shop: The “Shop” is ideally suited for students, first-time banking customers or existing customers with standardized banking needs that are already available via online channels, such as account opening and loan application, but that still draw some people into the branch.
The Lounge: This format provides customers with terminals for their online banking needs with staff having knowledge of only basic banking products, without complex advisory skills. The “Lounge” is primarily designed for building strong relationships with target customers who are individuals with relatively high income.
The Digital Pod: These “Pod” branches allow customers to perform all the transactions of a physical bank branch using sophisticated digital technology. The target market for this branch format primarily comprises Generation Y customers who need the flexibility to transact anytime and are open to using new technology.
The Pharmacy: It is a comprehensive full-service branch that incorporates all aspects of self-serve and online banking, to be used as a flagship branch to attract existing and new customers, typically showcasing innovative tools and extending high standards of service. The target customer of this branch is the mid to high net-worth traditional banking customer who desires proximity of a physical branch.