The Future of Retail Banking

future of retail bankingI saw the future of retail banking last week and it looked like nothing I had ever seen. Just as Starbucks transformed the coffee drinking experience by providing the notion of a third place, Capital One is transforming the notion of a bank branch and human interaction.

It’s not about Banking

Capital One took the brilliant step of offering a third place co-branded with Peete’s coffee. As you enter the branch, the only semblance of a bank is the back wall aka genius bar where a lone bank representative is hanging out waiting to help people with questions.

No more windowed offices with self-important banking executives peering at computer monitors with clearly nothing to do. No more bank teller windows with long lines of disgruntled customers who are not allowed to interact seamlessly with the bank and have to spend hours of precious time explaining why the bank’s various policies are causing massive disruptions in personal time.

It’s about value added service

The bank seems to realize that what people want most is a place to sit, do work and drink some coffee. Banking is a natural component of one’s life, but does not demand constant attention.

In fact, the one value add they offer up most often in the branch is 1/2 price Peete’s coffee if you are a customer of the bank. So instead of a coffee mug or some other worthless piece of junk giveaway, the bank is giving away what customers want most — half price coffee and a convenient spot to do work.

Offline/Online Convergence

Like so many online only retailers who have started opening up physical stores, Capital One 360 has brought forward the physical branch to the 21st century, augmenting their online service with an appropriate and measured physical bank presence.

Talking to the assistant, I learned that the branch model has proven so successful, that the bank is committed to opening more of these new style branches.

Going Forward

Of course, if every business offered up a similar physical presence, customers would be overwhelmed and the impact would be diluted. But in the meantime, this bank is showing that selling products is about service and endearing themselves to the customer, on the customer’s time frame, not theirs. Meanwhile, they are growing in the subconscious of a mobile, technology adept workforce that will engage the bank when the time comes. And when that time comes, the bank will be there.

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