Transforming traditional banking centers to fit modern consumer behavior and evolving mobile technologies is a challenge all banks and credit unions face today. It’s the talk of the industry— and everyone has an opinion on what the future holds for the branch. Many articles have been written about branch transformation, but not many statistics are published on the subject. With this in mind, Codigo recently released their 2015 Branch Transformation Report, their second annual research study that provides a snapshot of branch strategies for over 250 financial institutions in the United States. Compared year-over-year, the report provides some hard data into today’s branch transformation trend. Here are five takeaways from this year’s report:

The Remodel Revolution

In 2014, 26% of respondents claimed to be remodeling an existing branch location. This year, that number nearly doubled (51%), and the data shows one in every two financial institutions are remodeling at least one branch in 2016.  This statistic is a clear indication that major changes continue to happen in the branch. This ‘Remodel Revolution’ will continue for years to come as banks and credit unions must continually be evolving their banking centers to stay relevant with modern technology and consumer behavior.

Less are adding new locations

Although the decrease is slight, the data shows institutions continue to shy away from adding branches. Additionally, the majority of institutions adding locations are those with $1B or more in total assets—65%. This number could be an indication that smaller community institutions are focusing resources on adapting current locations to comply with the banking demands of today’s consumer and expanding reach with new methods of distribution— mobile and online.

Not reducing branch size or employee headcount

Contrary to last year, most institutions said they would not be reducing the physical size of the branch—87% of respondents compared to 49% in 2014. They reported a current average branch size of 2,116 SQFT per respondent. And coincidentally, of the small amount that did say they were reducing branch size, 83% claimed their new location would be 2,000 SQFT or less. In 2014, 100% of downsizing respondents said the same thing. A 2,000 SQFT size seems to be the cap for the newly transformed banking center.

Respondents reported that their current average employee headcount is 6.5 total employees per branch. Credit unions reported they would use seven total employees in the new or remodeled locations while banks reduced to 6. However, in 2014, respondents projected new or remodeled locations to be staffed by only four employees.

Enhancing the branch experience

As one in every two institutions remodels a branch this year, the majority (64%) are doing so with the primary goal of ‘improving the branch experience’. Limping in second place, 14% of respondents said ‘increasing branch profitability’ was the main goal. It’s impressive that so many institutions are putting emphasis on the customer experience, understanding that today’s tech-savvy millennials and economy-drivers expect more from a trip to the branch. No longer are they there to make a deposit or transfer funds— they’re there for expertise, guidance, and high-involvement services like mortgages and auto loans.

Branch Tech: Music making its way into the branch

As it was in 2014, digital signage leads the way as the most chosen technology in new or remodeled branches— 65% of respondents reported plans for DS. It’s becoming the norm to have digital signage in the branch as it provides a more modern, tech-friendly environment expected by today’s branch visitors. Tablet kiosks were also a hot technology as the branch becomes more self-serving and interactive—44% of total respondents said they would be adding interactive tablets to a remodeled or new branch next year.

Nearly 50% of institutions claimed they were installing overhead music into their newly built branches, which isn’t surprising as banks and credit unions continue to structure the branch experience around what’s been successful in retail. Music also provides a new in-branch marketing channel while providing a pleasant level of noise dampening when visitors discuss personal information with branch personnel.

These takeaways along with many others are in Codigo’s 2015 Branch Transformation Report. Click here to download Codigo’s 2015 Branch Transformation Report, and be sure to let us know what you see happening in the branch today!

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