If U.S. banks don't watch out, the Canucks may beat them at branch-of-the-futuredom. In an interview with Neil P. McLaughlin, vice president, channel strategy at Royal Bank of Canada this afternoon, we found out about new branches the bank is building that take the Umpqua Bank-style concept of retail stores and kick it up a notch.
The new stores, the first of which opened in October in Burlington, Ontario (to be followed by branch openings in Halifax in December and Toronto in early 2011) feature Microsoft Surface technology to educate and assist customers at kitchen-counter like islands, self-service kiosks featuring Cisco telepresence, and a media wall that helps branch staff facilitate seminars. The video below shows some of the basic branch features.
While like everyone else, Royal Bank of Canada sees customers migrating to the online channel for basic needs such as to check their balances and transfer funds and even to apply for new products, "we do see the branch as a critical part of our distribution network," McLaughlin says. "Customers want to have all the online and mobile capability they can get, but they also want to walk into a branch and talk to a skilled adviser when they need to." For instance, customers still come in to make cash and coin deposits, to conduct foreign exchange transactions, and to discuss more complex financial needs. "When they're ready to purchase their first home, they want to sit down with an adviser and have confidence that they're getting the right personal advice," McLaughlin says. "Customers may do 150 transactions online or at an ATM, then suddenly come into the branch after a six month absence. Often it's due to a major life event -- they're getting married, buying a home, renovating a home. With all that traffic, we knew our branches could become better at retailing."
At the new branches, customers can come in and sit down with an adviser, or they can come in and work by themselves -- there are even kiosks dedicated to online banking within the branch.
One piece of customer research the bank tried to apply to the design of its new branches was the finding that, "customers said, please don't try to put technology between us and your people," McLaughlin relates. "They wanted us to use technology to support adviser interactions, not replace them. That's the approach we've taken." The Surface and kiosk tools can be used by the customer by him or herself, or branch staff can guide the customer. These technologies could help the bank bridge the gap between self-service and full service, weaning people off of human support for basic tasks but keeping the human involvement for more complex products.
The Surface touchscreen interface provides financial information, such as a savings calculator and mortgage, credit card and investment information, including video clips.
The telepresence has been used largely by small business owners, McLaughlin says, who speak to small business advisers in the bank's contact center through videoconferencing.
To measure the success of these new technologies, Royal Bank of Canada will look at customer satisfaction through surveys and look at overall effectiveness of the new stores.
The reactions to new technology across all channels are often surprising, McLaughlin notes. "The old paradigms about who are the tech savvy customers don't always hold true," he says. "We recently had a chat session with a 99 year old customer about his credit card. We wouldn't have dreamed of having that conversation online, let alone via chat, a few years ago." The quality of video has improved so quickly that people are quickly becoming comfortable communicating with advisers through telepresence, he says.
Royal Bank of Canada doesn't seek a return on investment for each new branch technology. "With some of these technologies, we support our larger vision around what the new retail environment could be," McLaughlin says. "Some technologies have been developed so our people can spend more time out on floor and interact with customers in a nonthreatening, open environment."