A Different Way to Bank
July 24, 2008 henry
As a baby boomer, the traditional branch location continues to have some value for use of a community room, safe deposit boxes and just looking your banker in the eye; but the X & Y generations see little to no value in using the traditional branch. Yeah, they may have to go once in a while to get a cashiers check, or sign loan papers, but it’s an exception instead of the rule.
On a recent core selection consulting engagement, I was working with a very traditional well-established community bank in a University town that was looking for ways to bring together the students with their bank and the community. The university offers a “debit card/credit card� that is logoed with the mascot of the university and they typically bid the card out to whichever bank is interested. It was difficult for the community bank with 7 branches to compete, and they always were competitive because of influences in the community. However, with the larger banks coming to town, they are having much more difficulty. Yeah, they have an older ATM at the student center and they have tried several other things, but nothing they did brought the students or the faculty closer to the bank.
What does your 20-something and 30-something look for in a bank?
Ease of use…no more than a good internet banking application. Convenience…it’s there 24/7 before or after their hot date or party. Facebook or Myspace…sense of belonging and connecting….What?
I’m sure there are others, but you think about #’s 1 & 2. EVERY bank in a community has these, some better than others. The only issue we are dealing with today is making it easy and convenient. With compliance issues like multi-factor authentication, we SURE have not made it easier, but we do what we have to for security purposes. (This is a discussion for another time.)
The real problem is we have NO way to “connect� with these younger generations! Now I know it’s not easy and as an old guy, I say do like I did and check it out yourself. Well, that’s just not working. What if the bank provided the students/community with an online social network that THEY ran and THEY delivered content? Allow them to invite friends (like Myspace and Facebook), let them rate the local hot spots, let them privately or publicly “talk� with their friends, let them discuss the bank’s services, give suggestions and/or ratings, discuss the best profs, etc. etc. This dialog could go, on and on for years and years. Now, I know some of you are thinking, “This is crazy�, and to be honest, I don’t know if it would work. The success would be based on content and involvement of the students within the framework provided by the Bank.
The bank could be the catalyst and would have plenty of opportunity to have discussion with the community. They may want to have a community manager to chime in on some of the dialog and add pertinent content. And, if the community got behind it, Voila! In my mind, this a good way for the Bank to spend “Community development� dollars.
Just a little food for thought from an old-school guy!!!
3 Responses to “A Different Way to Bank”
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July 25th, 2008 at 06:21 AM
Well said [from another old school guy].
The key [imho] is to be where people are … BUT to be there when you are needed, and be in the background when you are not. Always available as required. Easier said than done, but online services have re-defined convenience, and Banks have to understand and adapt.
One part of that is for Banks (and Credit Unions) to take a look at themselves as others see them online, and realise that their brand is no longer controlled by traditional PR, but by how they act online.
July 25th, 2008 at 02:30 PM
A usable, robust online application is key, obviously, and not just for the university-aged generation. That includes the connections to you: put a name, phone number and picture of the person who’s responsible for their account, or even a picture of their branch, in their online banking home screen. Make it easy to contact that person if they really need to. Just don’t try to artificially create a “relationship” with them; fake authenticity = anathema.
As far as convenience, ATM placement can be a really big win. You don’t need to drop them all over town, hoping to get their transactions (and hoping they don’t leave you; ATM convenience is important). You should be able to tell from your transaction data where your customers are using other banks’ ATMs; if they’re students, odds are it’s right outside a bar or right on a central path from the campus to the main housing area. Put ATMs there and get your customer’s eyeballs back on your brand, offers, etc. 2 or 3 well-placed ATMs can provide more value than 10 evenly scattered ones.
July 27th, 2008 at 01:48 PM
What I struggle with is how to get most of the old school bankers to think like their kids. Bridging the gap between “online network” and email is one one way to start. Some of them still have their admin pick up their emails and print it out(I’m old but not that old). There are some “up and coming” bankers that “GET IT” and I tell you, Credit Unions are WAY ahead in my eyes.
I wonder why the Internet Banking players are not think like this?
Dan, your ATM idea helps to bridge..I like it..How about a “social” ATM?