|A tool that needs rethinking|
The next chapter in Brett King’s obituary for traditional branching
Branch Today, Gone Tomorrow: The Case For the Death of Branch Banking. By Brett King. Marshall CavendishBusiness, 55 pp.
Reviewed by Frank Sorrentino III, chairman and CEO, North Jersey Community Bank, Englewood Cliffs, N.J. Sorrentino is a frequent reviewer for ABABJ.com
I ask each of my prospective clients the same question Brett King begins his book, Branch Today, Gone Tomorrow: The Case For the Death of Branch Banking, with: “Will my kids ever visit a branch?”
Although bank branches have been staple in the traditional banking model, the rapid changes in today’s business environment is forcing bankers to reevaluate the status quo and create a more functional model.
Idea that’s served out its time?
As King discusses, traditional models rarely survive. When we look back at the technology of the past: the telephone, telegraph, encyclopedia, and even music, companies who continued to follow traditional models soon met their demise. So, why would we think are banks are any different?
King goes into extensive detail when describing the ways in which technology has transformed our lives, and thus our behavior as consumers. With the emergence of new technologies like the iPad, iPod, and iPhone, Apple alone has tremendously impacted consumer behavior. “Cell phones” are now “mobile devices” and a calling feature describes just one of its capabilities. Through applications or “apps,” these mobile devices allow bank consumers to access bank services, anytime and anywhere, and have the ability to transfer funds, check balances, and even make payments. Today, mobile banking is the fastest growing channel for the retail banking space, and as a result, a bank branch is no longer as valuable.
Banking in a channel-rich world
We live in an internet-ready world, where mobile and internet banking have changed the speed of service, and essentially, the way people bank. Bank clients now have the ability to do what they want when they want.
The question is, how do bankers keep up? This book discusses banks’ need to stay relevant and provide clients with the capabilities that compliment their behavior. It is now inconvenient to drive to a branch when the same functions can be performed from the comfort of one’s own home.
The bank branch was once critical to a consumer, but now is just another channel to choose from. Banks now need to adapt and provide a different level of service to their clients in real time.
Extinction or metamorphosis?
One of my core business principles is the need to be relevant. For those traditional bankers asking, “Is this really going to happen?” this book paints a clear picture of what is currently happening in the retail bank space, what the future may look like, and most importantly, the rate at which it is evolving. While it is unlikely that bank branches will disappear completely, we can expect the functions of a branch to change.
Although one may not completely agree with all of King’s predictions, this book does serve as an eye opener as to what is happening in the retail branch sphere. Technology is evolving at a rapid rate, and bankers must be able to “re-task” the business to remain relevant.
In my opinion, anyone considering a branch strategy these days should take into account Branch Today, Gone Tomorrow, in order to develop a clear view of the future of bank branches. The title really says it all.
A banker review of Brett King’s earlier book, Bank 2.0: How Customer Behavior and Technology will Change the Future of Financial Services, can be found here. The reviewer is David Gerbino.
[This article was posted on June 8, 2012, on the website of ABA Banking Journal, www.ababj.com.]
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