The Branch as a Digital Growth Engine
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What is the new job of a bank branch in a digital‑first world?
Your branch has a new job. Whether if you manage four branches or 4,000, most of you still haven't clearly defined what that job is. Last year, Bank of America scheduled around 10 million appointments with specialists, even though roughly 90% of client interactions were digital. Those individuals didn't just wander into the branch randomly. They had a specific reason to visit. I know this because both Bank of America and Chase have invited me in when I had no transaction to complete. Chase plans to open over 160 branches and renovate nearly 600 this year, even though only 9% of consumers prefer to bank in a branch. The biggest banks are creating spaces to attract people. We spent more than 15 years debating how
how many spaces we need. We send our customer offers all day long. Far fewer of us send a personalized invitation to visit. An offer asks for money. A useful invitation earns time. Using that time to make an existing relationship more meaningful for a customer or member is the branch's new job.
How are banks using appointments and digital interactions to deepen relationships?
Define the job first, then building relationships. remodeling or closing becomes a different question. As most of you know, I started my career as a teller when paychecks still arrived in envelopes and updated balances were done by hand. The branch didn't initially lose its traffic to the phone. It lost it to direct deposit, then ATMs, telephone banking, online banking, and mobile banking, each one eliminating one routine reason to visit after another. Every one of these changes was correct for the customer. The mistake was leaving the branch to wait in traffic, which those same investments were meant to prevent. This brings me to the branch business cases I see every day. The calculations almost always start the same way.
New households, new deposits, market share, payback by relocation. New customers and deposits are valid financial results. However, they're not sufficient enough by themselves as a goal for the branch. In a digital first world, the customer that a branch can help you grow might already be yours. They may carry a credit card.
Why should branch business cases focus on existing customers instead of new households?
They may operate a business you lend to and keep operating accounts elsewhere. They could have opened an account on their phone last spring. and never met a single employee in person. So what should the branch focus on? In my interview with Ron Johnson, who designed the Apple Store, he emphasized that there should be a great physical experience. Warby Parker answers the most basic question. Why would a digital customer experience even walk in. Warby Parker began as a direct-to-consumer brand. Last year, it operated 323 stores and plans to reach at least 900 in the future. These stores extend the digital model by providing something the website can offer as well. An eye exam. The exam is named, scheduled, and valuable, even if nothing is purchased.
Around 75% of prescription glasses are bought where the exam takes place. And exam customers often become some of their most valuable relationships.
What can retail‑store models like Warby Parker teach banks about physical experiences?
The stores recover the invested capital in less than 20 months. Warby Parker has signed a store as a job that its website couldn't fulfill. The eye exam serves as the invitation. It earns the customer's time and establishes the store's place within the larger relationship. Banking needs its own version of that. When I interviewed Will Smada, the obvious story was that Bank of America was opening financial centers. The most significant story was where they were opening them. Before launching consumer centers around Boise, the bank already served business, wealth, and corporate clients across Idaho. Smada explained an intentional process of proactively reaching out to clients to build relationships. He also mentioned that when establishing a financial center in a new community, they see a 50% growth in digital sales in that area.
They stop treating each branch as an independent franchise. They evaluate economics across the community because customers don't experience banking one building at a time. Chase provides a very clear case study. Half of new bank checking account customer relationships in expansion markets originate from existing credit card customers.
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Chapters
8 chapters
1
What is the new job of a bank branch in a digital‑first world?
0:00–1:06
2
How are banks using appointments and digital interactions to deepen relationships?
1:06–2:12
3
Why should branch business cases focus on existing customers instead of new households?
2:12–3:09
4
What can retail‑store models like Warby Parker teach banks about physical experiences?
3:09–4:26
5
How do Chase and Bank of America use branches to convert credit‑card holders into full‑service customers?
4:26–5:40
6
Why does the traditional lobby‑P&L scorecard often keep the wrong branches open?
5:40–6:46
7
What criteria should guide decisions to build, remodel, or close a branch?
6:46–7:57
8
How can a branch earn a customer’s time and add value across digital and physical channels?
7:57–9:57