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Take online banking a step further: Make it an e-branch

October 11, 2011

Not using your bank’s website, or even your online banking function, to its full potential is like having an iPhone and only using it for phone calls.

That’s a pretty close paraphrase of what Michael Seymour told attendees of the ABA Bank Marketing Conference in Baltimore as he described how his bank transformed its website into a fully functioning ebranch. He is senior vice-president, marketing and retail services, for Franklin Savings Bank, a $350 million-asset mutual based in Franklin, N.H.

The bank went all out a year ago to establish its ebranch, completely revamping its website and making available almost everything online except giving cash back.

“We were established in 1869, and we have eight locations in the central part of the state. We had products we were trying to sell, but no way to truly close the sale. Also, our locations, though successful, had become service-related branches. We needed to move beyond that and to move forward and gain market share in other areas,” Seymour says.

Other reasons the bank embarked on its ebranch project included:

•    More and more of the bank’s business was being done electronically, and branch visits were declining.
•    Existing customers tended to be retired empty nesters, and the bank wants to attract nest builders and young professionals.
•    A desire to extend the bank’s geographic reach without the expense of traditional branching.

It started by building on what it already did. Since 2005, it has provided online mortgages. Starting in 2009, the bank developed a plan for online account opening. Also in 2009, it launched an information-only business page on FaceBook in order to start attracting the specific demographic it wanted, namely social-media-literate young professionals.

At the same time, the bank started advertising online, primarily through Google channels. Finally, in mid-2010, the new ebranch website completely replaced the bank’s old website, and the ebranch was born.

“The old website was attractive but it was not easy to use. It required multiple click-throughs to get to where you wanted to go, and even then you couldn’t close the deal,” Seymour says.

The new website features a picture of an actual branch lobby. However, embedded in the picture are specific areas where information can be obtained or action can be taken. Just by passing the cursor over an area, the customer can find the latest rates, learning about checking accounts, personalize a debit card, and more. Above the picture are other clickable areas, all starting with “I want to…”, the point being, it takes only one click from the home page to get to where you want to go. Check it out at https://www.fsbnh.com/.

Results from the first year of operation have been positive, Seymour says. Visits to the website are up 23%; page views are up 50%; and pages per visit are up 26%.

Of all the mortgage applications received by the bank in the past year, 54% were submitted online, and 64% of mortgages were approved online. For consumer loan applications, 54% were submitted online, and 32% were approved online. Of all online deposit accounts opened in the past year, 51% were from new customers.

The main frustration the bank faces—at least from the marketing side—is that the bank’s compliance department has required that all new online customers must live within 25 miles of an existing brick-and-mortar branch. The reason given is that this is meant to deter fraud.

Seymour acknowledges that position but isn’t happy with it. “It’s like being given a Ferrari but told you can only go 25 miles an hour,” he says.

Still, he’s encouraged by the success so far of the bank’s new ebranch, and says the numbers continue to climb.

“The bottom line is, this really allows us to sell products,” Seymour says.
John Ginovsky

John Ginovsky is a contributing editor of ABA Banking Journal and editor of the publication’s TechTopics e-newsletter. For more than two decades he’s written about the commercial banking industry, specializing in its technological side and how it relates to the actual business of banking. In addition to his weekly blogs—"Making Sense of It All"—he contributes fresh, original stories to each TechTopics issue based on personal interviews or exclusive contributed pieces. He previously was senior editor for Community Banker magazine (which merged into ABA Banking Journal) and was managing editor and staff reporter for ABA’s Bankers News. Email him at jginovsky@sbpub.com.

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