With digital banking having overtaken use of physical bank branches for the first time, many banking executives are rightly considering the feasibility of maintaining a high street presence in 2018.
However, physical bank branches still possess a host of attributes that cannot be replicated online. They also occupy a sentimental space in the minds of some customer demographics.
Here, we will introduce you to the key reasons why physical bank branches still matter.
Consumers still value physical bank branches
Three data-backed reasons you should maintain your physical bank branches:
1) Major transactions/decisions
Though 70% of bank customers are comfortable checking their balance or paying bills online, almost two-thirds (63%) still want to discuss major decisions face-to-face.
57% of customers seeking financial advice and 50% of those setting up a mortgage will visit a branch.
Among global mass affluent customers (representing the top 10–15% of customers in terms of income), the second largest contingent of research respondents (26%) favoured visiting a branch. This makes visiting a branch a more popular option than utilising a banking app (24%).
Researchers attributed this trend to the increased likelihood of this demographic to engage in larger transactions or decisions on a more regular basis.
2) Appeal to specific demographics
Age, gender and other factors all impact bank branch visitation rates.
62% of 18–24 year olds are averse to using mobile devices to apply for financial products (therefore driving them in-branch), compared to 82% of people aged 55+.
That older people prefer physical branches is something of a given. However, 18–21 year olds were (surprisingly) the most frequent bank branch users during 2016, with 25% visiting at least once per week.
Women are more likely than men to carry out their financial transactions in-branch. Customers who conduct their day-to-day banking online are also more likely to be unemployed, and less likely to have a degree-level education (Your Money).
Despite this specific appeal, US research shows 86.7% of bank customers still expect to use physical bank branches in two years’ time.
3) Convenience and friendliness
Account or technology-related questions and problems are major push factors for persuading customers to visit branches. Conversely, customer service standards act as a pull factor.
86% of bank customers prefer visiting a branch to resolve problems, while 73% will do so to get answers to their questions.
Approximately one-third of customers have experienced problems with their online account (32%) or mobile banking app (34%) (Egremont International).
Processes that cannot be replicated online – such as Barclays’ instant debit card replacement service – enable physical bank branches to maintain an edge in terms of convenience in certain areas.
85% of customers find staff helpful when they visit physical bank branches (eMarketer). 40% cite the overall enjoyment of visiting a bank branch as their primary reason for visiting (Egremont International) .
Statistics do not lie. Now that you understand why physical bank branches are crucial to continued success, use location intelligence software to gain a competitive advantage in terms of bank branch positioning and brand marketing.
Derive insights from targeted data and adapt your bank’s strategy to ensure ongoing profitability by signing up with Periscope®.