Mary Mack took over the leadership of Wells Fargo’s consumer banking operation in mid-2016. The high-wire job includes overseeing the megabank’s huge branch system (5,300 branches in 37 states) along with a major role in repairing the once-venerable brand’s broken image.
On top of that, Mack manages a retail banking system in transition, with the role of both digital banking and branch banking evolving rapidly as a direct result of the COVID-19 pandemic.
All this while the company’s new CEO and President, Charlie Scharf, has set out to make Wells more efficient, shaking up the institution’s management team with multiple new top hires from other organizations to help improve results and to reduce costs by $10 billion.
A daunting combination of challenges like this could easily overwhelm many executives, but when Mack, Senior Executive Vice President/CEO of Consumer & Small Business Banking talks about her job, it’s with an enthusiasm — almost a cheerfulness — that seems to go beyond standard corporate spin.
Mack, a 35-year veteran of the bank, feels that Wells Fargo suffered a reputation hit that undermined an image decades in the making. Since then the company has been rocked by salvo after salvo from Washington, including regular pillory sessions on Capitol Hill.
But Mack says that she sees that “everything we’re doing is contributing to the rewrite of the story about what Wells Fargo is and what it will be for customers going forward. I’m probably as optimistic about where we’re headed as I have been in a long time. ”
Mack spoke with The Financial Brand about the progress made on the customer service front; the growing role of digital banking for Wells; her continued strong belief in the future for branches, albeit in a different role; her view on what consumers really want from banks; how COVID has accelerated banking trends; the limitations of generational labels; and about the role of advice in banking.
Keeping a Finger on the Patient’s Pulse
When Wells signed consent agreements with federal regulators in 2016 regarding the community banking operation, Mack, newly appointed head of the huge unit, was among those obliged to sign, although the period of sales practice abuses had not been on her watch.
“We still have more work to do,” says Mack, “but now I don’t have to spend five hours a day every day on it. We need to be building for the future.”
A key source of feedback about how Wells’ community banking operation is doing is the consumer complaint process. “I get regular complaint feeds,” says Mack, which gives her a sense of the negative side of things.
But she also wants to see how consumers are feeling about the community banking operation more generally. To accomplish this, she says, branches and contact centers have adopted the Net Promoter Score system. “This gives us some real-time feedback,” she explains.
Regarding complaints, “what I’m looking for is the kind of feedback we are getting and how we are following up on it,” says Mack. “We have the ability to follow up on feedback at the individual level now. I want there to be a continuous loop, so I’m using that information to improve our product delivery.”
“I’m looking for anything in the numbers regarding types of fees or anything else that customers don’t like or that they want to see changed,” says Mack.
Mack says that something she is learning is that many consumers crave more simplicity from Wells. That’s something many banks and credit unions could learn from.
Elaborating, Mack points out that, “in the effort to help and to address every need, we have in some cases created complexity. And consumers are saying, ‘Make it simple for me. I don’t want to pay fees, but I don’t want to have a lot of complexity in order to avoid them’.”
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What Do Consumers Really Want From A Bank?
When asked how much pressure she feels day-to-day from fintech companies, Mack turns the discussion to the issue of access, and how consumer perceptions of this have been altered by fintechs and ecommerce in general.
The pandemic has permanently altered consumers’ viewpoint on ecommerce and online and digital transactions in general, Mack believes. In addition, “Americans increasingly expect that they will be able to do things online using information that providers have about them to make their lives easier. People’s behaviors have become conditioned to what they can do online.”
This should make all institutions extremely conscious, she continues, about the need to deliver access to consumers how and where they want it. “That’s driven a lot of our investment in digital as well as our investment in services like Control Tower.”
Control Tower is a service enabling Wells Fargo consumers to view, monitor, and manage their digital financial relationships connected with the bank all in one place.
Mack says the bank continuously asks, “given the explosion of online alternatives to getting life done, what kind of changes might that create in consumers’ financial expectations? And then, how do we accommodate that?”
This relates to a point Mack made several times during the interview: The public just isn’t that interested in banking.
“I like to tell our bankers that our customers are not interested in getting a mortgage. They’re really interested in buying a house. They’re not interested in a savings account. They’re interested in sending their kid to college. We have to start thinking in terms of the things that our customers really want to achieve and use what we do to help them accomplish their goals.”
Mack says the industry has to stop debating delivery channels as if there is a single solution out there waiting to be discovered. “There is no ‘one-size-fits-all’ way people want to engage.”
She resists the tendency to put members of the various generations into boxes regarding how they want to be served and to allow that to influence thinking about the industry’s future.
“Certainly, there are preferences that show up in generational categories, but there again, it’s not one-size-fits-all,” says Mack. “We’ve got Boomers who bought iPads to see pictures of their grandkids who are now using them more deftly than they would ever have imagined.” That was going on before COVID-19 arrived, even though the pandemic hastened adoption of digital channels.
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Soaring Digital Use Is Not the End of Branches
Any discussion of the future of branches for Wells Fargo, especially in a post-COVID context, has to be prefaced with a single fact, as stated by Mack: “Even in the midst of a pandemic, we have over a million customers a day coming into our branches across America.”
Many Wells branches did not completely close during the height of the lockdown period, some offering banker-by-appointment service. (Roughly 20% did close, temporarily.)
“I’m really grateful that we have so many drive-throughs across America,” adds Mack, “because customers are showing that they are feeling really confident interacting through the drive-throughs.”
That said, use of mobile and online channels picked up markedly at Wells during the pandemic period. In mid-2020 the bank estimated that it had 31.1 million digitally active customers, up 4% from the year before, with roughly four out of five of those being mobilely active. Checks deposited via mobile device reached a record high for the back in the second quarter 2020, rising 32% over the previous quarter.
“COVID accelerated a number of things that were already underway,” says Mack. “We were making pretty steady progress in digital investment and digital adoption — it has been our fastest-growing channel. And the pandemic helped both customers and employees better appreciate the role that digital can play and allowed it to give customers alternative ways of obtaining service.”
“We have a lot of customer data that looks at how often they are visiting branches and what they do when they are there, and we have been on a journey the last number of years to look at our footprint and what customers tell us they need it for,” says Mack. She says in time Wells will be able to see how much of the COVID-era growth was temporary, due to health concerns, and what portion reflects a definite change.
While Wells has been consolidating branches in recent years, both Scharf and Mack believe a great deal of life remains in branches, though COVID may accelerate an evolution in their main purpose from transactions to an increasingly advisory role.
“We think that that’s a huge opportunity,” says Mack. She also notes that when she refers to Wells’ “footprint” she isn’t speaking solely of the thousands of physical offices and ATMs but of all of its digital capabilities as well. The physical-digital combination is all a continuum, in her mind.
“We have to show up where customers are,” she explains, and that’s never going to be all in one place. “We have to work on how to make banking easy, how to integrate it into customers’ lives, and how to make it a natural part of what they’re already doing.”
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Prepping Branch Bankers for Advisory Roles
Digital banking will clearly accelerate the evolution of the jobs of branch bankers, with their roles shifting increasingly to various forms of advice. Mack says that transition is already underway, and that a cadre of branch bankers who have been working at home have been taking remote training.
“We’re trying to take advantage of this moment to make sure our bankers have the skills and ability to provide advice,” says Mack. Many of those in advisory roles will be younger bankers who may not have the life experience of some of the consumers and businesses they will be advising, so part of what they will be trained in is how to help such customers.
Mack thinks flexibility will be key to making the advisory function become a success for Wells. Harking back to her comments on simplicity, she says for many consumers the trick will be hitting the level of detail they want.
“We need to make advice easy to consume, really transparent and with the control put back in customers’ hands,” says Mack. “There are people who want to go deep on data, and we certainly have it for them.”
In time advice will be readily available on a digital face-to-face basis — think “Banker FaceTime” — in addition to in-person.
Even where advice becomes digital, the transition to that must be handled carefully.
“The challenge will be how to provide the tools you need to be able to ask questions, be interactive, play out scenarios and look at tradeoffs and choices,” says Mack. Developing these to serve the entire Wells footprint will be an ongoing job for Mack and her people.