Evolved branches serve changing membership

Editor's Notes

• #2: Welcome. I’m Caroline Willard, EVP, Markets and Strategy for CO-OP Financial Services. For the next few minutes, I’ll be telling you about how the transformed branch is keeping up with the service demands of a changing membership. The word we chose in the title, “Evolved,” connects us with the theme of our GAC exhibit – Evolution is Inevitable. Let’s see the forces of change at work in the branches of today and tomorrow.
• #3: Remember this guy?The story of branch transformation begins here. This is what a branch used to look like. It’s big. It’s built like a bunker. There’s a picture of it on your money. For generations, this was what a branch was – and within this branch, everything happened. You opened accounts, closed accounts, cashed checks, made deposits, applied for loans – you name it. The branch was your identity. It was everything.
• #4: Branches went more or less unaltered for generations. And then this happened.With the invention of the automated teller, the idea of branch transformation began. It began with the idea that maybe people could help themselves with simple transactions if they had help from very sophisticated machines. Here’s one of those machines, apparently created by Diebold.What this gentleman is hoping to do here with this early ATM isn’t completely clear. What we recognize is that he’s trying to help himself. And though that machine is no longer current in today’s world, the idea behind it is. There’s something appealing about helping yourself – especially to money.That started it all. With the invention of the automated teller came the idea that branches could offer up new modalities of service. CO-OP isn’t quite as old as this picture, but we’ve been part of the ATM revolution from our inception. We joined this evolution back in 1981, and have been helping to drive change ever since.
• #5: Recently, that change has accelerated – way beyond anything we could have envisioned 33 years ago. Our ideas about branch networks are changing – dramatically.The forces behind this are wide-ranging, but let’s have a look at three of the larger trends that are driving change. First up: Self service.In previous talks here at GAC, we’ve discussed consumers using their mobile phones to control their own card accounts. We’ve also talked about people using their mobile devices to make in-store payments without using the checkout line. But if you came to GAC from out of town, you may also have used self-service technology to select the seat for your flight, maybe even pay for some snacks in the self-serve line at the nearest supermarket.According to statistics up to 40% of consumers now use self-service checkout at the grocery. 70% of airline passengers use automated check in. Self-service technology has evolved, and so have the consumers who use it. Now that they’re empowered to do all kinds of things for themselves – maybe with a little help from technology – self-service is being seen as great service. Not for nothing, younger consumers are especially partial to self-serve technology. Gen Y is 15% more likely to deposit by ATM, 29% more likely to use new payment tools. And Gen Y will represent 40 percent of all banking transactions by 2016.
• #6: Now, just to confound us, here’s an equally important trend – or maybe anti-trend: People still want branches.Not only that, but young people in particular want branches. The Houston Business Journal just surveyed 600 young Texans about their banking activity, and over half said they visited a branch at least once a month.Young people under 30 want to open their accounts in person, in a branch. Why? The prevailing wisdom is that people are only comfortable buying online or by mobile when they feel like they know enough about the product – and young people opening their first accounts don’t feel comfortable without a face to face. Now think about that more broadly. If new accounts and new products need face to face interaction, then branches are key to growth. And while the economics of maintaining your own vast network of full-service branches might not be favorable, the value of being there for your members is still strong.
• #7: So, people want self-service – including channels like mobile.And they want access to branches – they literally want to see that you’re there.And then there’s this third thing: They want everything to integrate. They want a seamless user experience. The day is coming when your members would be able to initiate a transaction on their mobile phone – say, withdrawing $40 – and complete it with a special code at the ATM. In the future, they might begin filling out a loan application online and complete it in the branch.All the technology – in and out of the branch – needs to be seamless, integrated, better than ever.
• #8: Put these three things together and you have transformation. The old Parthenon of banking is now old school. We need to come up with an entirely new vision of what a branch should be.
• #9: How does CO-OP help you make that transformation?At the core, our ATM network and related technology make in-person transactions easier and more efficient than ever. What does that mean? One example would be enabling your members to make loan payments at a mainline ATM instead of a teller – so that the teller line is gone, and so is the line. It’s a new way of looking at your members’ branch experience – and a new way of operating a branch.Or, to take it a step further, think about a guest member being diverted to a CO-OP NextGen ATM to do a shared branching transaction. They’re able to speed through their transaction and you speed up your throughput. Now you’ve expanded your capacity in two ways – by taking in shared branching transactions and keeping them efficient.CO-OP’s evolutionary forces include:Our CO-OP ATM network and our state-of-the-art CO-OP NextGen ATMs.CO-OP Shared Branching, which provides your members with access to over 5,000 credit union branches and 2,000 self-service locations nationwide.Sprig by CO-OP, which brings the shared branching experience to mobile – along with some great digital wallet features like pay-anyone P2P.CO-OP Member Center – a great solution for credit unions wanting to provide 24/7 service without 24/7 staffing.And so much more to come…
• #10: If there’s a big message here from CO-OP, it’s that we’re not only working on the nuts and bolts of branch transformation – with evolving ATM technology and mobile channels like Sprig by CO-OP – but we’re looking toward the big, integrated picture, with new ways for you to connect your channels to each other. And to connect your credit union with its members.As credit union branches move toward new models of service, everything is bound to change. For example, we expect to see radically different staffing ratios with the introduction of technology like video tellers that connect to a centralized location like the CO-OP Member Center. That’s not just a shift in technology, but a shift in the branch experience for both you and your members.Live people in the branch are less likely to be focused on transactions and more likely to be focused on relationships and sales. Is your team ready? Members will be looking for ever-improving technology. Do you have a plan to get there?As you look to manage all of these areas of growth, do you have trusted partners to help you create a vision – and to realize that vision efficiently?We hope so, because the future is going to be awesome.
• #11: We think your whole branch network will be reimagined – and not only in terms of what’s in the branch, but what comprises your credit union.When we talk about branches, we’re sometimes transported back to the day when the branch was the embodiment of the institution. The branch was you.In many ways, it still is. It’s the place where you connect with your members face to face. But now you may be making that connection over a video terminal. Or with a tablet in hand. Your staff may be able to stop counting quarters and processing checks and start building real relationships with members.Now, when we think about our networks, they include – but go way beyond – the branch. And in that way, our new “branch” network is even more “us.”It’s everywhere – with shared branching, self-service locations, CO-OP ATM, your locations are extensive.It’s omnichannel – online, on mobile and across all channels, your members are always connected.It’s efficient – old revenue models are out, but new efficiencies make it possible for you to flourish.It’s ready to grow – evolution stops for no one. CO-OP is building new products and new connections with the idea of making adaptation easier, even effortless.Finally, it’s you. You aren’t shaped like a bunker anymore, but with a little investment and imagination you can be everything your members need now – and how much better is that?