Out of Sight, Out of Mind: Why Branches Still Matter

Maintaining a bold street presence remains critical in competitive retail banking markets, especially for small banks and credit unions that can't compete with major institutions that can operate larger branch networks. As the population of branches shrinks, visibility will grow even more critical.

One of the traditional values ascribed to branches and ATMs is that they act as a billboard for your bank or credit union. With decreased usage of branches over the last ten years or so, primarily through reductions of teller transactions, is the “billboard effect” still valid?

Evidence shows it is, even as marketing rapidly evolves.

The international integrated marketing firm Dentsu states that “2019 marked a major milestone in the world of advertising. For the first time, digital ad spending in the U.S. exceeded traditional ad spending.”

That seems like a critical threshold. I doubt we will ever see digital marketing be less than the #1 marketing expenditure. Digital channels have become the preferred place for routine financial transactions. People seemingly live on their smart phones today. So it makes sense that more marketing has moved to that medium.

While digital banking and marketing may diminish the impact of building signage in the big picture, the need — and value — for making your institution’s presence known hasn’t gone away. You need to convey that you operate in a local market and more specifically in a neighborhood.

Because branches serve neighborhoods. They are a place, and you need to inform the public you are there. (Interestingly, when Varo Bank launched its national advertising, it targeted local neighborhoods for dramatic billboards, and Accenture’s Alan McIntyre suggested in an interview with The Financial Brand that he believes all-digital neobanks at some point will explore physical offices.)

Don’t Waste a Valuable Asset:

An issue that arises constantly is that banks and credit unions not only don’t maximize their signage, but sometimes forfeit even the value of what signage they do have.

Read More: The Future of Brick-and-Mortar Branches

Branch Signage Strategies Hinge on the League You Play In

For most of the large banks, their branch strategy is to build a broad network to dominate a market. This strategy maximizes new customer capture and delivers a long-term strong deposit share. Once that share level is achieved, these same institutions seek to reduce expenses through branch closures while retaining customers.

Those large players can afford to reduce the brand advertising impact of branches because:

  • They are already a well-known option for potential customers.
  • They also leverage the other options for advertising, including digital.

However, if you aren’t one of those major bank players, branch signage is likely more important to your branding effort. Smaller banks and credit unions don’t have the resources to advertise through all the other marketing channels — both traditional or digital. Therefore, it’s even more important to make the most of your “branch billboards.” That can be challenging, as local rules might limit the amount of signage allowed on your branches.

In many years of specializing in branches, I’ve visited thousands of them, so I’ve seen good and bad branch signage.

No Time to be Shy!

Good branch signage is big, bold, and on as many walls as possible.

If the branch is on a street corner, both exposed sides have the bank or credit union name. If the building is in the parking lot of a shopping center, the back side exposed to the parking lot is also branded. Never miss an opportunity.

Read More: Why Bankers Won’t Ditch Branches, Despite Digital’s Explosive Growth

Examining Common Branch Signage Problems

If your signage doesn’t work, the value of maintaining a branch for the sake of visibility gets lost. People drive and walk through neighborhoods and impressions of an institution’s presence build over time as they do so, and jump out when a new player arrives.

Brand Awareness Bank of America Volt

Too big a mouthful. There are multiple reasons for branch signage to be weak or ineffective. Sometimes it’s a matter that the bank or credit union name is too long so the branch lettering must be smaller to make it fit.
Persistant brand industrial credit union branches

Getting lost in the greenery. Sometimes poor planning of landscaping causes branch invisibility, almost literally.

I can’t tell you how many times I have visited a new branch site under construction only to see landscapers planting trees under the branch signage that would grow to be 20-30 feet tall at maturity. Or sticking in bushes next to monument signs along the street side, blocking people’s view.

In both these cases, what looked good initially would be an issue a few years down the road. In some cases, you may not have control of the situation if it is landlord’s doing or has been municipally mandated.

But you’d never know that this was an Umpqua branch (left), or that there is a Wells Fargo ATM next door to a Peoples Bank branch.

Value of branches hidden brand

These last two examples are all too often the reality on the ground. However, other problems may arise with nary a tree in sight. In New York City, poor visibility is often more about building scaffolding. Local rules require “sidewalk bridges” and other pedestrian protections that necessarily block much signage.

Chase bank branch brand

Try shouting from the inside. Some methods financial institutions have tried to overcome limitations on exterior signage include adding through-the-window signage to increase branding.

Brand awareness Chase Bank of America

That financial firms take these additional steps to brand their buildings tells you they feel it’s important. We used some of these methods when I was at Bank of America, but make sure you know local rules. We often found that interior signage needed to be at least three feet back from the window.

As the number of branches will likely continue to shrink in the years to come, each site will be more meaningful in establishing your local brand.

After all, why do you think McDonald’s adds some representation of large golden arches to all their sites?

This article was originally published on . All content © 2024 by The Financial Brand and may not be reproduced by any means without permission.