Does the new branching dynamic mean a movement away from self service towards interaction? Isn’t that in the face of what Gen Y is telling us by word and deed that they want?

Are banks just taking another stab at trying to address consumer desires based on what they see as desirable/successful i.e. Apple stores?

@Joe – Based on the list of top 10 stories, it seems like a lot of “innovation” energy is (still) being applied to branch design. The evolutionary struggle occurring in the physical delivery of banking services is certainly one of the most captivating storylines in the industry today. Everyone keeps tinkering with their branch models. There’s always something new.

@Serge – The Financial Brand has consistently taken the position that any financial institution trying to turn its branches into hangouts is pursuing a failed strategy. As you suggested, no one wants to hang out in a bank. But can branches be designed that are more friendly? More inviting? Absolutely. That doesn’t translate, however, into a massive investment in flashy technology. If “cool” is what you’re shooting for, then maybe load up on techy stuff, just don’t be fooled into thinking it will transform your branch into a hangout.

The Tao of retailing says that consumers who linger longer buy more. But does this really apply to banking? “Ooh, while I’m hear, I think I may just as well get a CD.” I don’t see banking as an “impulse purchase.”

To your point… No, the aesthetics of a space have zero correlation with transactional execution. It’s like this: Someone can look great in a new suit, but it can’t cure their incompetence.

But having a friendly, inviting, cool branch can be positively correlated with increases in new accounts. When people want a [banking product], they are probably more likely to visit a financial institution with a pleasant experience and attractive aesthetic.

But even if they stroll into a Bank branch to play with a toy, a remarkable the leap of faith is required to connect playing with a cool toy to opening a Bank account at a new Bank. The same is true with Bank masquerading as a coffee shop / lounge. Consumers might stop in for coffee but again, the step to open an account at a new Bank when such need did not exist prior to the visit is highly improbable.

Both of these strategies are great for very large banks … using a portfolio theory of investment, it makes a great deal of sense for them to experiment with different approaches. They expect most of these experiments to fail. However, Community Banks and Credit Unions do not have this luxury. They cannot afford to fail with multi-million dollar expenditures (especially when it involves a channel that is declining in its importance for sales and service)

It really comes down to a central question of what Consumers really want from their Bank – a) sexy and flashy branches with the latest technology, or b) flawless transaction execution, attractive rates on deposit & loans, access to financial products & services, advice, and great customer service?

I do like what People’s Choice CU has done though. The space isn’t stuffy or over-the-top loungy — it has a nice vibe to it and looks functional.

Are these Banks & Credit Unions solving the wrong problem?