The long, slow transition to advice

For years, many financial institutions have been aiming to transition their branches from transaction-focused centers into advice centers—a move that’s taken on additional urgency in the wake of the pandemic shutdowns that forced even more customers to digital channels.

What would these advice centers look like? Some of the more forward-thinking institutions envision the branch as a smaller space offering a concierge-style of banking with far fewer, if any, transactions.

“More like a hotel lobby and less like a DMV,” says Gina Bleedorn, chief experience officer at Adrenaline, an Atlanta-based brand experience company. “The space encourages customers to be comfortable enough to have consultative conversations and elevates the customer experience in general.”

The biggest challenge financial institutions face is rooted in the need for a completely different mindset among employees—a “hunter versus farmer mentality,” meaning more proactive than reactive, Bleedorn says. This new mindset combines the engagement skills of a salesperson with the ability to find the right customer-centric solutions.

Banks can try to find employees from other industries, but they would have to ramp up training to make sure these new hires understand banking and financial services. And there’s no guarantee that these employees will work out.

Frost Bank, a San Antonio, Texas-based institution with $53 billion in assets, has been transitioning its branch network for more than a decade. The goal is that each branch will offer a hybrid of advice and transactions as part of an overall concierge model, says Bill Day, senior vice president of corporate communication.

“At our branches, guests are greeted at the door by a banker who can help them with any of their needs,” Day says. “Our transition was several years ago – it was gradual, natural and driven by what we were hearing from our customers and our desire to provide a warm, welcoming space for people to visit.”

With fewer customers coming in for basic transactions, Frost reduced the amount of space devoted to teller lines and moved to a universal banker system. Most of its branches also have conference rooms that function as meeting spaces for local community groups.

Nick Miller, president of Clarity Advantage in Concord, Massachusetts, says the advice center model his team sees most frequently positions the branch as an entry point to the bank for expertise or advice. But this continues to be a work in progress.

“For the industry as a whole, the hype is out ahead of the execution. I can’t point to a single institution that has mastered this for 90% or even 80% of their branches—but at every bank, there are branches where advice or introductions to experts are done well.”

At these branches, he says, managers and staff are more willing and more able to engage clients or potential clients in conversations about their goals and challenges, versus taking orders or “tossing them over a wall to an expert,” and they have long experience working with customers to solve their problems.

“The first challenge institutions have in executing this model is that they are not definite about what exactly they mean about branches as advice centers,” Miller says. “Who do they want to give advice to?”

The upfront questions are numerous. Which difficult questions do they want to address? Who should deliver the advice? How much guidance is housed on the website versus shared by people? How does branch staff express the approach to customers? How do branch staff and product experts “dance together and with clients,” so that clients feel like they got a good answer and had a satisfactory experience?

Even the best plans face challenges with compensation systems that aren’t aligned with the advice center strategy, lean staffing for cost reduction and high turnover, Miller says.

“If the fewer number of employees in the branch are busy with transactions, they can’t take very long to sit with a customer,” he says. “If there’s significant turnover, staff won’t have the experience or training to ask the right questions and guide and support customers in the right direction. Institutions need to have clear and detailed plans for these and other questions.”

Katie Kuehner-Hebert is a BAI contributing writer.

Ideas and insights for banks and credit unions creating the next generation of branch experiences are highlighted in the BAI Executive Report,  “Branches are changing with the times.”