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Technology and the Branch of the Future

credit union data center remodeled by Level 5

Leveraging Critical Credit Union Data Components for Smart Geographic Expansion

In the ever-evolving landscape of data collection in the credit union and financial service industries, the race to capture new markets and enhance member experience has intensified. Basically, you have to keep up.

Furthermore, with the growing influence of technology, interwoven with strategy consulting, site selection, branch design, and building, this bevy of tools has become vital for financial institutions to stay competitive and thrive and meet members’ needs properly.

In this post, we will explore six crucial data components that inform the branch pro forma; as well as and aid in the geographic expansion plans of credit unions, enabling them to build the branch fit for the growth of the future.

1. Loans and Deposits Forecasting: Unearthing the Elbow Room

Understanding Market Viability

When considering expansion geographies and specific trade areas, it is essential to assess the availability of loans and deposits in that market before making a final decision on branch real estate site selection.

This crucial data component helps credit unions determine the “elbow room” or growth potential in a given area, identifying if there are still untapped opportunities or if the market is already saturated and unsuitable for expansion.

merging credit union data and technology

2. Competitive Analysis: Identifying Opportunities Amidst Competition

Beyond the Elbow Room

When entering a new retail banking market requires a thorough competitive analysis.

Accordingly, financial institutions must gauge the opportunities for a new entrant and assess how well they can compete against existing players. This involves understanding whether competitors dominate or outspend potential newcomers, ultimately determining if the market is viable for a new branch.

3. Consumer Overlays: Tapping into Existing Consumer Bases

Building on Existing Clientele

Another critical factor in successful geographic expansion is identifying how many existing consumers reside in the expansion geography.

A pre-built consumer base can significantly impact the success of a new branch, providing a strong foundation for growth and member engagement.

4. Demographic Tapestry Profiles: Recognizing Shifting Consumer Demographics

Mapping Consumer Demographics

Even if credit unions know their target consumers, they must ensure that these consumers reside in the expansion area.

Demographic tapestry profiles allow you to understand the overlays of the existing consumer base in potential expansion geographies. Consequently, this helps to avoid potential mismatches between target demographics and location.

Glasses and pen laying on top of paper data charts

5. Market Potential Indices: Measuring Consumer Behavior

Predicting Consumer Behaviors

Market Potential Indices (MPI) provide valuable insights into the likelihood of adults in a specific geographic area exhibiting purchase behaviors aligned with the banking products and services offered by the credit union.

This data component aids in assessing the market’s demand for the institution’s offerings or those they plan to introduce.

Business people in a group sitting around a conference table looking at charts, data and computers

6. 4 Square Quadrant: Mapping Branch Performance and Market Potential

Visualizing Success

The 4 Square Quadrant, a critical component of the LEVEL5 Branch Market Analysis engine, provides a comprehensive reading of proposed branches in a given trade area.

By scatter-plotting the branches based on performance and market potential, financial institutions can effectively gauge which locations are likely to thrive and which ones may under-perform.

Paving the Way for the Credit Union Branch of Tomorrow

In the dynamic world of financial institutions, leveraging technology to analyze critical data components is paramount for making informed decisions regarding geographic expansion and long-term growth. 

Credit Union strategy consulting, site selection, and branch design and building can be significantly enhanced with the insights drawn from loans and deposits forecasting, competitive analysis, consumer overlays, demographic tapestry profiles, market potential indices, and the 4 Square Quadrant. Armed with these data-driven tools, financial institutions can confidently build the branch of the future, positioning themselves for success in a competitive landscape.

For expert guidance and assistance in harnessing the power of these data components for your institution’s growth and expansion plans, do not hesitate to contact LEVEL5, the industry leader in strategy consulting, site selection, design, and construction for credit unions and banks.

Let us help you create the branch of tomorrow that sets new standards and meets your members needs.

How to Choose the Perfect Location for Your Credit Union or Bank Branch

Sun Community Federal Credit Union exterior

a data-driven branch strategy approach

Selecting the ideal site for your credit union’s or bank’s next branch is a critical decision that can significantly impact your institution’s long-term success. Gone are the days of relying on intuition alone; today, financial institutions need to use data-driven strategies to make informed choices. 

At LEVEL5, we understand the importance of coupling data with our Branch Site Selection services to provide well-informed, actionable recommendations. In this article, we’ll explore why it’s crucial to let the data dictate the right location in your trade area and how partnering with a developer-minded firm like LEVEL5 can lead to the best results.

Bird's eye view of of a town with roads and trees

Data-Informed Branch Site Selection: More Than Drawing a Circle on a Map

Simply drawing a circle around a location on a map based on gut feelings won’t guarantee the best site for your next credit union or bank branch. Accurately assessing growth markets requires a comprehensive analysis of multiple data points that leads to a quantifiable recommendation. 

However, while having data pointing to a specific site is essential, it doesn’t guarantee the availability of suitable locations in that area. That’s why LEVEL5 synthesizes our data strategy with our vast real estate acquisition experience and capabilities.

Aligning Strategy with Actionable Branch Site Recommendations

Data without a clear strategy is meaningless. Paying for data analysis is only valuable if it leads to actionable insights. We combine our Site Selection services with the data obtained during our Branch Market Analysis Strategy sessions so that we only recommend prime sites which can be acquired. 

This integration ensures that the locations we recommend not only meet the data criteria but also align with your defined business strategy. By fusing data and strategy, we present you with workable options that truly support your long-term growth goals.

People in suits seated around a table discussing business

The Benefits of a Developer-Minded Branch Network Partner

Choosing a site is about understanding how the chosen location fits into your long-term plan. That’s why we think of ourselves as developers with your overarching plans as the goal, not mere brokers. Our approach involves a thorough assessment of the geographies and available options within a given trade area. 

Moreover, we overlay the Credit Union or Bank Branch Design types that best suit the specific location, directly aligning with your 10-Year Branch Pro forma developed during the Strategy phase. This approach ensures that the site chosen will indeed support your long-term objectives.

Construction worker and project manager on an unfinished job site wearing hard hats, looking at blueprints. Surveyor in the background.
Edwards Federal Credit Union branch exterior, three-quarters view

Location, Location, Data-Driven Action: Partner with LEVEL5 for the Perfect Credit Union or Bank Branch Site

Selecting the right site for your branch or headquarters is a critical process that requires more than just intuition or simple mapping. A data-driven approach, coupled with a clear strategy, is essential to making informed and actionable decisions to grow your branch network. 

At LEVEL5, we bring you the expertise of a developer, not a broker, as we assess geographies, identify suitable options, and align them with your long-term goals.

Let the data guide you to an optimal site and work with a partner who understands your unique needs. Contact LEVEL5 today to ensure that your financial institution makes the best location choices for sustainable growth and success.

Branch Optimization: Choosing the Right Path for Long-Term Success

increase Growth and Profitability with curated branch network strategy

branch exterior depicting branch network strategy by Level 5

What is important in branch network strategy?

When it comes to strategically managing branch networks, financial institutions face crucial decisions about whether to keep, remodel, relocate, or close branches. These decisions can significantly impact growth and profitability over many years. While data plays a vital role in informing these choices, there are several factors to consider beyond mere numbers to ensure your resources and efforts are allocated correctly for healthy growth. 

In this article, we delve into the strategies for making the right decisions and highlight the importance of strong leadership in shaping a successful credit union or bank branch network.

The Four options

Keep: Identifying High-Performing Branches 

Identifying branches worth keeping involves a comprehensive assessment that goes beyond immediate performance. It requires evaluating various factors such as financial benchmarks, forecasts, and environmental considerations.

By examining both internal and external data, financial institutions can determine branches that not only perform well in the present but also show promising long-term potential.

Branch Remodel: Breathing New Life into Branches 

Sometimes, a branch in the right market may experience a decline in performance. Instead of closing it outright, a remodel can be a viable option.

how the remodel helps

Through incorporating new technologies, design elements, and layouts, financial institutions can rejuvenate the member experience and attract and engage more customers with a fresh and modern ambiance. An updated branch remodel design enables them to tap into the untapped potential of existing locations.

interior depicting level 5 branch network strategy

Relocate: Unlocking Potential through Strategic Moves 

Under-performing branches in suitable markets might benefit from relocation. The decision to move can arise from factors such as branch type, traffic patterns, or location restrictions.

data for relocation

Analyzing external data, including market trends and demographic information, helps financial institutions identify areas with greater growth potential.

By strategically relocating branches, they can leverage favorable conditions and improve overall branch performance.

Close: Making Tough, but Necessary Decisions

Closure is a challenging decision for any financial institution. However, there are instances where it becomes necessary to maintain the network’s performance. Branches that not only underperform but also adversely impact the entire network may require closure. Strong leaders must rely on internal and external data to make the tough call of closing branches that are no longer viable.

Work with Credit Union & Bank Growth Consulting Experts

Effective branch management involves making strategic decisions about keeping, remodeling, relocating, or closing branches. 

In the dynamic landscape of branch network management, making informed decisions is vital to maximizing your credit union’s or bank’s growth and profitability. Financial institutions need a partner that can provide expert guidance and data-driven insights to navigate the complexities of keeping, remodeling, relocating, or closing branches. 

That’s where LEVEL5 comes in. As a leading growth consultancy and best-in-class branch design and construction firm, we’ve specialized in branch transformation for over 20 years, offering actionable, comprehensive solutions tailored to the unique needs of financial institutions.

Contact us today for help making your branch network optimization a success! 

3 Reasons to LAUNCH: Discover

We Have Liftoff

LEVEL5 is excited to help your FI with your growth initiatives in 2023 and beyond with our LAUNCH Program.

We’ve built this phased approach to assessing and launching your growth strategy around the methodical steps aimed at uncovering the challenges getting in the way of your Credit Union or Bank achieving its objectives and goals.

Phase I: Discover

LAUNCH program discover
Training materials

The first phase in. our LAUNCH Program is called “Discover” – when our relationship will begin with a casual conversation, no more than 30-minutes, where we simply have a chat.

In this discussion, we’ll go over our services and background – but this phase is frankly about you. We’ll want to know about your FI’s history, your place and positioning in the communities you serve, and most importantly, current state versus desired state.

Your “Current State” is where you are today – number of branches, trade areas, assets, branch type mix, and of course, your member/customer base.

Your “Desired State” is where you want to be – expansion plans, asset goals over the next 3-5 years, thoughts on branch types, hub & spoke models, as well as any M&A’s that may be in play.

From here we’ll start to discuss next steps. Most importantly, we’ll need to uncover what is getting in the way of you executing and achieving your goals. That bridge from here to there is typically full of roadblocks, but that’s where LEVEL5 comes in.

Why LAUNCH At All?

The LEVEL5 LAUNCH Program follows a methodical, yet casual approach to uncovering the critical needs of your Financial Institution. Through a series of easy discussions, our team will be able to capture your goals, but also understand what is getting in the way of you achieving them.

From there, we’ll be able to move into the other phases of the LAUNCH Program and make actionable recommendations on how to execute to these goals.

To learn more about our LAUNCH Program, and to schedule your first “Discover” call, contact us today to get going.

The yin and yang of branching

Much has been written about the branch of the future. What does it look like? What are the key strategies? How does the member/customer experience play out? Is it even already here?

The short answer is there is no short answer – only different perspectives. The right answer, if there is a singular one to consider, is this: the branch of the future construct is entirely on you and your organization to make it as you see fit.

One perspective on the future of branching is the discussion point involving the traditional legacy of a branch and its core being the transaction, while also understanding the momentum to the modern branch being advisory.

The problem with contemplating a branch strategy from either a transactional perspective or an advisory perspective is in the “or.” Your branch strategy should not be rooted in “or” – it should be rooted in “and.”

Think about it from the perspective of Yin and Yang. Colloquially, Yin and Yang are used commonly to describe to diametrically opposed concepts, like oil and water. But in reality, the concept of Yin and Yang is actually describing two things that compliment each other – not opposing one another.

So when you are contemplating your Branch of the Future and trying to figuring out the anchor strategy of a branch that is either transactional or advisory, the answer is both.

A well designed branch will have both a transactional and advisory zone. The layouts may differ, as long as the strategy is rooted in the member experience. And the way it is executed may also vary, with different forms of cash machines deployed across different areas (both inside and outside) of the branch to appease those short visit based transactions, whether it be ITM’s in the drive-through, Cash Recyclers affixed to floating Teller Pods, Assisted Self-Service machines flanking the Teller Stations, right up to a traditional ATM for walk-up traffic.

On the advisory side of the house, designs can see casual Onboarding Stations with tablets at the ready for initial conversations, semi-private conversations at high top counters with screens for a deeper financial planning session, or a fully private conversation in an enclosed office with a resident Personal Banker, or even in a video enabled room where members/customers can speak to a remote expert.

When you’re contemplating your next branch strategy and the discussion of transactions versus advisory arises, remember the Yin and Yang – they are not individual strategies unto themselves, they are complimentary strategies that are part of a larger, engagement-based branching experience.

If you’d like to learn more about branch strategy and review floor plans demonstrating a well-executed transaction and advisory zone, contact LEVEL5 today.

Crystal Ball 2022: The Full Series

For those who have read the entire series thus far, or for those who may have missed a week, but are looking for a consolidated version, this is the version for you.

Below, we present our combined 4-part Crystal Ball 2022 series.

Part 1 – Costs Continue to Rise

While indicators seem to be pointing to a “recovery” from the pandemic, such as employment rates, and even total cases per day/month, one of the lagging hangover effects that has not begun to ease are construction costs.

One of the impacts of the pandemic, foreseen or not, was the spike in construction across the board, both residential and commercial.

As seen with the below graph from the U.S. Bureau of Labor Statistics, costs of materials have not only spiked, but are also the highest since World War II.

Regardless of prices, this has not translated into construction projects being put on ice – quite the opposite.

Never have so many construction input costs risen so fast at the same time.

Cranes are flying over downtown skylines, and residential neighborhoods are replete with both new homes, remodels and extensions.

So what does this all mean for a Bank or Credit Union who is looking to grow, and looking at the branch as a main driver of this growth?

It comes down to a matter of investment.

While it may cost “more” to build a branch compared to pre-pandemic cost structures, if it’s growth you seek, and it can only/mostly be done via new members bringing in new Loans and Deposits via a new branch in a new Trade Area, you have to ask yourself if it’s worth the investment.

Wayne Gretzky famously said, “You miss 100% of the shots you don’t take.”

In banking growth terms, this quote can be translated into the simple economic situation of needing to invest to grow, or, “you have to spend money to make money.”

Material costs are predicted to rise, or stabilize at least through the first half of 2022, but what is the trade off of NOT doing anything? How can you value being stagnant, and how do you justify to the board to sit and wait for an unknown “cost” future?

The reality is, for a Bank or Credit Union looking to grow, you act now.

So, how do you counterbalance higher material costs for optimal margins?

Economies of Scale

Typically, when LEVEL5 begins a client engagement, the discussion of a branch is never singular, it typically involves 2 or more branches, even if the schedules for the builds is over a 12-36 month period.

If the plan is to indeed design and build more than one branch, buying the raw materials in advance will yield savings, and aid the overall margin.

Labor Discounts

Deals on labor can be had when multiple projects are happening either concurrently, or successively.

As the General Contractor, LEVEL5 has existing relationships with different Trades (sub-contractors) across the country, and have had success in booking these Trades for multiple jobs. This aid the sub-contractor, who can keep their workers engaged for longer.

Real Estate/Site Selection Transactions

LEVEL5 has been acquiring land and buildings for clients for over 20 years. In doing so, we veil your identity during the negotiation phase. The reason this is important is because in doing so, we have more negotiation power, and often save our clients up to 18% on the transaction price – helping your bottom line.

Time is Money

The other benefit of working with LEVEL5 when it comes to overall cost is the savings you’ll get from working with a proven national General Contractor. In today’s economic climate, the supply chain is compromised and there are labor shortages – both of these typically mean that a standard construction job inevitably is going over on schedule – and added time is added money.

We have been successful in queuing up work well in advance, which is why we subscribe to the “Design-Build” philosophy, not Design-Bid-Build.

Design-Build forecasts materials and labor during the planning stage. When things are known and predicted up front, plans can be made, and money can be saved.

Part 2 – Supply Chains & Trades Issues

While the pandemic seems to be drifting away, at least in its economic impacts, construction materials supply chain problems and availability of Subcontractors will continue to remain a challenge to credit unions and community banks looking to open a new branch in 2022 or 2023.

A critical component to executing a Branch plan is to have the right partner on your side. 

Advance Planning, Advance Savings

During the past 2 years, more and more of LEVEL5’s clients have been opting for advance design and planning of multi-year, multi-branch rollout strategies for their prototype branches. We believe this is happening largely because the antidote to such an unpredictable construction landscape is predictability that translates into advanced planning with the benefit of cost savings.

So how does working with our team help you plan for the future and reduce your spending? 

Establishing a supply chain means that you have a defined product to execute upon. Let’s use a branch prototype as example. Once you’ve worked with LEVEL5 to design and finalize your prototype, this means that you’ve already specified materials needed for the majority of your branches. At this point, our team can work proactively with different manufacturers, subcontractors, suppliers for furniture, equipment, fixtures and so forth. 

This advanced heads-up will give our sourcing partners an upfront and predictable way of understanding allocation needs. It will in turn helps to bring down prices for you.  

The Design-Build construction method allows you to make material selections based on current availabilities. We factor this in with you in the design process.  

Conversely, in the Design-Bid-Build process, a stand-alone architect designer may not be as privy to current materials costs in the design stages. Not being able to account for fluctuations here can result in unexpected costs once bids are turned in. 

Think of the saying “knowledge is power.” In this context, we’re talking about the knowledge of future needs. It is a power that keeps costs down for your financial institution.  

As you can see, advanced design and planning of rollouts can certainly drive down cost. 

Knowing Costs Now Helps You Make Better Business Planning Decisions 

To your advantage, you have an annual business planning cycle that needs to be built on sturdy information.  

Once your professional credit union and bank consulting is complete, you’ve decided on the prototype and strategy. Then, we supply you with an accurate price estimate on your new branch or branches. 

Having an accurate estimate now takes a huge unknown out of your organization’s plans, giving you more assurance and realistic scope of your budget. It also allows you to make effective projections and preparations for changes in personnel at varying locations.  

Secure Necessary Subcontractors Amid Shortage & Strain

Subcontractor labor shortages have been an issue even before the pandemic. Think all the way back to the great recession in 2008. But now, it’s become even more strained due to the aftermath (or continued impact) of COVID-19.

Because of these circumstances, the ability of your General Contractor to secure the right kind of Subcontractors for your project will only become more difficult the longer you wait to get things started. Less time to plan ahead and communicate properly with Subcontractors on their availability can cause obvious hurdles for your goals.  

This goes for both singular branch builds and multi-branch rollouts. However, we want to note that Subcontractors will be more aggressive sometimes. For example, bidding and staffing for projects that are part of an integrated/multi-location rollout will be aggressive. A one-off branch project will be much less so.

Regardless of the branch rollout volume, you can see how moving forward with long-term action now will put you in a preferable spot. It will minimize unknowns in both project staffing and pricing.    

Don’t linger too long when making growth decisions – icould cost you greatly in finances, stress, and timeline goals for your bank or credit union. 

Part 3 – The Branch Lives

Gone are the days of industry commentators preaching “the branch is dead!” and gone are the talks of moving to solely digital platforms (we hope, we think, but probably not).

Long live the branch!

Let me explain:

The Surprising Aftermath of an ongoing Pandemic

Long ago, in the ancient days of 2018 and 2019, the percentage of people using branches was declining. In 2010, 83% of people surveyed said that they visited bank or credit union branches at least once a month. That number steadily declined to 70% and 69% as mobile and online banking steadily increased.

Everything changed when the pandemic hit. For a brief time, branch use obviously hit an all time low as the whole world shut down. Then, the strangest thing happened. As the world hesitantly began to open back up, as stimulus checks were sent out, as FDA-approved vaccines rolled out, people stepped back out into the sunlight. People not only started visiting branches again, but they started visiting them even MORE than before. In 2020, it was reported by the Fiserv company, Raddon, that 77% of consumers went to a branch at least once during the pandemic.

Despite the health risks of going in public, despite business shutting down, and despite the convenience and rise of mobile and online banking on top of all of that, the branch prevailed. People WANTED to leave the house and go interact with other people. People craved that human interaction.

The New Branch

Now, don’t get me wrong, digital banking is still rising and will continue to rise. But the rise of digital does not have to mean the death of the branch. They are not mutually exclusive. In fact, for either of them to work to their fullest potential, they must support each other. While mobile banking rises, brick and mortar will also rise. It might not be the traditional physical building that you’re used to, but it’s a physical building nonetheless. There’s a new branch in town.

Your branch locations must be used to fill the gaps that mobile leaves. This means the human element to branching is imperative. When a modern-day consumer walks in the branch, their first touchpoint should be a human one inquiring about their needs. After that, they can move either to the transactional zones of the branch or the advisory.

We’re finding more and more that people are coming in less for the teller lines and more to sit down in a private office to talk to someone about their finances. Now, they want to walk in the branch, tell an advisor about their financial goals, and plan a strategy to meet those goals. They want to learn about the different types of credit card programs you offer and discuss which one would best fit their needs. They want to learn about your high-yield savings account and how to properly invest their money. Some of them are buying houses and want to know about their mortgage options.

Even if they do want a transactional process done, many times, they’ll head straight to the ATM’s or ITM’s. As popular as mobile has and will continue to become, you’ll never be able to withdraw cash from your phone. At a tech table, a consumer might want to use a tablet to go through the steps of opening an account. You might ask yourself, “Why would they do this at a branch when they could go through the same steps on their phones?” Well, it might seem the same, but again, that lacks the human component. if they wanted to open an account quickly on a tablet inside the branch, they would also be able to ask questions to the nearest teller about the different types of accounts and which of them best suits their needs.

Your consumers cannot have the same level of security in informed decision making from their couches.

Whatever reason the modern consumer has for needing brick and mortar branches, there’s no denying the existence of that need. The people have spoken and the branch is here to stay.

Part 4 – The Branch Strategy Shift from Transactional to Advisory

Last week, we predicted the importance and need for the branch in the year to come. This week, let’s talk about the why and how of it all.

The Shift is Happening

While it is true that the branch is indeed alive and well, it is also true that the branch we used to know and love has irreparably changed. A study done by Raddon right before the pandemic surveyed consumers on their branch preferences. The results showed that when it came to the older generations, they did prefer those traditional branch layouts with the teller lines and transactional components. It’s what they were used to and knew how to use. When it came to Millennials, however, the results told a different story. The study showed that Millennials preferred very technology-oriented branches, and/or the “coffee bar” model of branch.

The technology focused branch is the branch that you walk into to see digital screens around, displaying local news, the weather, the stock market trends, advertisements about products that the financial institution is offering, and events in the area. It holds interactive teller machines and a tech table with tablets for consumers to use for transactional needs. The rest of the branch, then, is for advisory offices and maybe a teller pod or two.

A Cup o’ Coffee for Your Thoughts

The “coffee bar” branch is the branch with an attachment of a Starbucks, a Peet’s coffee (if you’re Capital One Café), or a local café that the financial institution is partnered with. That’s the branch that you, as a consumer, can visit to enjoy a coffee and dessert while you take out a car loan or open a new account. It can be a convenient place for students to go to for financial advice or to begin the learning process for the upcoming adult responsibility of money. Then, they can stay for the coffee and snacks with peace and quiet while studying.

The existing Capital One Café is the perfect example of this. In order to be successful, these branches are conveniently located and strictly advisory.

Both branch types represent solutions to needs that mobile banking does not and cannot fill. Millennials are no longer those kids that can’t get off their phones. They are now financially independent adults with careers, families, and homes. They are now thinking about how they can move up in the world and this means investing their money, taking out car loans and mortgages, creating financial strategies, and even planning early for retirement. Properly designed advisory branches are the perfect (and only) fit for those needs.

A Strategic Plan First

Now, that’s not to say that every single traditional branch must be shut down immediately. You must root every decision in strategy. You must take a look at your branch network, target markets, and consumer demographics before making the decision of what type of branch you need in each area. The market surrounding a college campus would benefit a lot more from the “new” branch than the market surrounding a retirement community, for example.

Lucky for you, LEVEL5 has the leading Market Analysis team for Financial Institutions in the country. Our experts will evaluate the relevant data to draw conclusions and then align them with your strategies and goals. After that, we can come up with a game plan together and begin the execution.

Whew, that was a lot. But good stuff, right?

Contact Us today to discuss any items herein. We’ve been future-proofing growth plans for Credit Unions and Banks for twenty years, helping our clients grow at twice the national average. It’s time you work with LEVEL5.

Brand Deployment – Execution with NECU

Now that we’ve uncovered the mystery of Brand Deployment, it’s three types and how it is a critical element of Branch Transformation, let’s take a look at this in practice.

LEVEL5 has just completed a branch in Hooksett, NH for Northeast Credit Union and this branch is an amazing example when it comes to Brand Deployment.

This ground up branch represents an entirely new Brand Deployment and Design approach for the CU, who operate locations across New Hampshire and Maine.

As discussed in our previous post, this effort would be categorized as a “Refresh” Brand Deployment as NECU did not go through a brand change, but the new branch introduces completely new ways to represent the brand in the physical space.

There are a handful of foundational elements when thinking of a “refresh,” as detailed here with NECU.

Traditional and Digital Signage

SIGNAGE

When we’re discussing signage, we mean both exterior and interior.

For exterior, your signage should not only represent your brand appropriately, but should also act as a way to attract and welcome your customers, day or night. And, it’s not only about your logo. Proper execution should include directional/wayfinding signage for entry/exit, parking, ATM’s and drive-through. Just as prominent as your exterior signage should be, so should your interior sign.

Whether it be a full-blown brand wall, or something a little more subtle, your brand should be displayed proudly and prominently.

In this example from NECU, they have a traditional branded sign, flanked by two digital displays rotating branded messages, as well as an accent wall with geometric patterns seen throughout the branch’s design.

Dual Teller Pods

FURNISHINGS & FINISHES

More often than not, when we think of a new branch representing a “refresh,” one of the main differences that customer’s will likely notice right out of the gate may be the new overall design aesthetic of your furnishings and the small finishes that complete the look. This is never more present than a traditional Teller Tower giving way to Teller Pods, or other “open concept” style deployments.

NECU chose to introduce a Tech Bar to double as a greeting station and a new way to advise customers about key products and services via an iPad before being directed to other sections in the branch.

Brand Badge and Coin Wrap

BRAND ELEMENTS

Beyond your primary logo and the signage deployment both inside and out, there are other brand elements to consider. In the case of NECU, they did a fantastic job to not only wrap their cash equipment in branding designs and commentary, but they left no section of the branch without key messaging that expanded their overall brand to include badges at the Teller Pods, but also clever slogans that speak to their members.

Another element to note for NECU is the subtle style-guide interpretations that have manifested itself in the branch. There is a consistent diagonal treatment across the branch, that is a design interpretation of the “N” in their logo, as well as a diamond pattern, which is an abstract extension of that brand element. This is seen as painted accents on their primary signage wall, “privacy guards” in the offices and even right down to to wall plaques in front of doors in the back office.

Mural of Iconic Landscape

COMMUNITY ELEMENTS

The last key consideration to any Brand Deployment is the execution of community elements. They key here is local, even hyper-local where multiple branches may exist in different parts of the same town or metro area (Trader Joes does a great job of hyper-local murals). In the case of NECU, they have two murals. One is at the entryway of the branch, giving each member an immediate sense of the local community by showing an iconic image of the Merrimack River, the central water feature in the area.

Additionally, the Children’s Area has a large mural of Mt. Washington, not only the highest peak in the New Hampshire White Mountains, but in all of the Northeast and a geological feature carrying a great sense of pride for locals.

If you’d like to learn more about NECU’s Brand Deployment and how these types of elements can be adopted into your existing or new branch network, we’d love to chat with you. Contact Us today.  

Now Playing: First Half Review in Pictures

Watch our latest video highlighting the first half of 2019’s key Branch Transformation projects.

2019: Year Half Over and Glass Half Full

Let’s look back on the first half of 2019, and then we can look ahead.

With 2019 now half over, we thought it might be worthwhile to revisit The Financial Brand’s article from the beginning of the year entitled, “Top Branch Trends for Banks and Credit Unions in 2019” and see if the commentary outlined in the article is still relevant. How is Branch Transformation taking hold at the mid-point of the year? Has the commentary held true? What does the (near) future look like?

Branch Closures

Branch Closures Steal Headlines

Our newsfeeds are still dominated with the announcements of branch closures. This may spell doom and gloom for an industry continuously accused of not modernizing fast enough for the evolving consumer sentiment, but the “death of the bank branch” is not really the story here. Under the catchy, clickbait-oriented closure headlines, the real story unfolds, telling of consolidation as a result of mergers and acquisitions and/or due to branch relocations. In fact, just under the branch closure articles may very well be a companion article talking about branch expansion.

Branch Expansion

Chase Announces new NYC Flagship

The big banks (large national brands and dominant regional players) have announced aggressive expansion plans at the onset of the year, and those announcements haven’t died down at the year’s mid-point.

On the coattails of Chase announcing aggressive plans to expand into Philadelphia, the Financial Institution announced this Spring to open nearly 100 new branches across 9 major metro areas.

And now, Chase has just announced their new New York City Flagship Branch, meant to be the epitome of how they intend to do brick and mortar banking from here forward.

Along those lines, community banks and credit unions continue to look towards aggressive expansion plans, despite the shadow of digital banking, the allure of digital-only banking and the fear instilled in all of us when doom-and-gloom articles speak of a possible recession, etc.

In fact, here at LEVEL5, our Consulting and Real Estate divisions have never been busier. John Hyche, an industry expert often quoted in The Financial Branch article, has seen the expansion trends materializing and his book of business has never been more full. As cited in the article, one of the key drivers in community bank and credit union expansion is the evolving shift in Demography.

Demography Shifts

One of the main reasons we’re talking about expansion plans with our clients is due to the shifting geographies and needs of banking customers. Since we are continually seeking to deliver on the financial needs of the customers/members, we know that location is key and opening a new branch on the wrong street corner is a costly mistake.

It’s not even really about where things have migrated recently or currently. The proper approach to location selection is rooted in the right data approach to understand the need and identify not what’s relevant now, but what will be relevant tomorrow and in three years.

As stated in the Financial Brand article, LEVEL5‘s own John Hyche states, “Branches will continue to follow shifts in demography as new areas develop. These moves reaffirm the popularity and value of physical channels in establishing brand recognition and gaining market share.”

Branch Transformation

The final piece in this overall equation is to not turn a blind eye to trends, but to equally not rush into them haphazardly. The burden of the right digital approach is a heavy one for us all to bare, but purchase and implementation decisions shouldn’t live in a box. The right mix of Digital Signage, Full/Assisted Self Service, Kiosks, Tablets, etc. need to be deployed based on the right strategy and how they will ultimately help enhance the overall customer experience based on the way you do it.

If the year is continuing to take shape and you’re interested in learning more about branch expansion, branch transformation and the right approach, Contact Us today to get the conversation started.

7 Deadly Sins of a Bad Branch Strategy – Full List

When discussing your own branch network and the exciting prospect of a remodel or ground-up project, you often look at your competitors, other institutions for best-in-class branch designs and even brick and mortar sites outside of a branch altogether (Apple anyone?).

While we often talk about what we like and the elements that we may want to emulate in our own project, there is the other side of the story – the “not so goods” and the “what were they thinking” elements.

And so, with that, come on a journey with us down the dark alleyways that are the 7 Deadly Sins of a Bad Branch Strategy.

1. LOCATION

Location, Location, Location

SIN: For not using data to inform location decisions.

Yes, the saying still holds: Location, Location, Location. But it’s never as simple as just being in the heart of town, on the main thoroughfare or at the right ingress/egress points during rush hour. Knowing your town and your neighborhood helps, but the naked eye and good intuition do not have the luxury of data, particularly the kind of data that is forward thinking and aims to future-proof strategic decisions. The right combination of Consulting Services, which will run the right queries with the right combination of data, will yield results for tomorrow, not just today. Furthermore, the right Real Estate partner goes beyond identifying the vacant building or lot – the right Real Estate partner can find the ideal property that may not even be on the market. They know property valuations and have the experience to negotiate – getting you the right price per square foot.

2. FOOTPRINT

Empty Space is Scary Space

SIN: For choosing a branch size that is too big.

Gone are the days of 5,000+ square foot branches. With many transactions now happening outside of the branch, oversized branches aren’t necessary. This is not like tennis or golf, where an oversized head increases your sweet-spot. Oversized branches, especially for the amount of transactions occurring, are not sweet. In fact, they just feel wrong. Empty space is sinful. And worse yet, filling it in with an extra Self-Service machine to gather dust or filling it with something else unnecessary altogether is a good strategy gone wrong. Downsizing new branches or reworking the footprint for a remodel is the right approach. Make the branch feel welcoming and purposeful. Not cavernous and empty.

3. DESIGN

Who Wants a Cuppa This?

SIN: For choosing a design not born from strategy.

This is not about pretty or not. And it’s not about modern or not. A great looking branch can be executed in a historical building, maintaining those historical elements, but does the design do your brand justice? Does it invite people in, foster interactions, flow properly and perhaps ultimately, does it help justify the branch’s existence? The Design is not just about aesthetics, though they are important. The Design should be born out of purpose, rooted in your corporate strategy and further justified by properly serving your customers in that community. Brand Deployment is especially important in a well-executed Design. It’s not just about logos and tag-lines, but the vision, mission and customer-oriented service embodied in the physical Design. So, go design your “Apple Branch,” but only if that design fits within your brand.

4. TECHNOLOGY

Just for the Tech of It

SIN: For introducing technology that is intimidating, unnecessary and goes unused.

It’s everywhere and rightly so. But let’s not do technology for technology’s sake. What was originally seen as a threat to the traditional brick and mortar way of doing banking (yes, we’re talking about online/mobile banking here), the right deployment of technology can actually enhance the branch experience and bring in a true omni-channel approach to transactional touch points. Digital Signage is a great way to take what used to be a static mission or vision statement, and have it brought to life in an engaging and dynamic way upon a customer entering your branch. And since we’re talking about dynamic, a well-deployed fleet of interactive touch screens can enable your customers to discover products or services, check-in, or find their way to the right section of the branch. While video conferencing is not necessarily new, it really seems to have come into its own with practical in-branch applications so customers at one branch can speak to a subject matter expert at a remote location, seamlessly, in real time, and with real, actionable next steps.

5. OMNI-CHANNEL

SIN: For being too heavily weighted in one customer touch point.

It may sound like a fancy word, but omni-channel is really just the idea of ALL customer touch points not only existing, but existing harmoniously and purposefully with one another. What is born online, may very well terminate in a branch and vice versa. The right branch strategy will take the omni-channel elements into account, have equal weight at the table and understand how they all work together. The epitaph of brick and mortar has yet to be written. After all, 90% of sales still occur at a traditional store across general retail.

6. PEOPLE

SIN: For deploying poorly trained and disengaged employees.

Have you ever been to a restaurant where the food is “fine” but the service is great? You probably keep going back. Conversely, you’ve probably been to a restaurant where the food was really good, but the service lacked – and you probably haven’t been back. Why would your branch be any different? Before we even get to whether your staff has been properly and continually trained, were they even part of the original branch transformation strategy? Taking a step prior in this regard can really go a long way. Your great branch strategy and amazing design will all be for naught when your customers walk into a branch where the staff are disengaged, feel disassociated from the branch, feel that the “new” way of doing things is not their thing, more less, even understand why the technology is there in the first place. Train them well, but make them feel germane to the mission and you will have evangelists delivering amazing customer service.

7. EXPERIENCE

SIN: For not developing and delivering on a cohesive strategy and executing flawlessly to delight your customers.

When you take the right approach and blend of the six elements above, mix them together with purpose and execution, you have great customer experience. But don’t be confused here. “Customer Service” is NOT “Customer Experience.” A successfully executed transaction may not necessarily have a customer walking out the door, feeling delighted and ready to tell their friends and family it’s time to make the switch. Think big picture here. There’s more than completing the transactional circle of life from hello to goodbye. Remove barriers. Be intuitive. Enable a great flow through design, in the right part of town, with the right sized branch. Have technology enable, not scare. Have your people embody your mission and values, deliver on the promise and make every single customer who walks in want to come back, regardless of the online conveniences of some transactions. That’s a great experience.

For the sins above we have committed, there is not reason to dwell in the past.

Let’s do something about it. If you’re guilty, there’s no judgement here. All we ask is that you begin purging these sins, and that may very well start by you contacting the experts at LEVEL5.

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