Tuesday, June 22, 2021

Bank Branches Need to Be More Like Apple Stores

Phillip Jackson, Chief Commerce Officer
Innovation / Technology

This blog was originally published on PYMNTS.


The pandemic that changed everything is probably the essential truism of the year 2021, a change that can largely be summed up with a single word: digitization.


“I like to say there’s this digital veneer that’s over top of every experience we have — when you shop in-store, when you go grocery shopping, when you buy a car or even a home, there is a digital experience that’s woven into every interaction that we have now,” Rightpoint Chief Commerce Office Phillip Jackson told PYMNTS.


It’s a shift that has changed our purchasing habits and how we pay for the purchases we make. What consumers want at the checkout has shifted fundamentally, and it won’t be de-digitizing anytime soon, he said.

That means traditional players, like banks, are now faced with changing the experience they offer to meet the shifting needs of digital consumers, who have never had more choice when it comes to where they keep their money and how they use it. The price they’ve paid for choice, and the opportunity mainstream financial services providers can capitalize on going forward, is how well they understand how much money they actually have, he said.

Fighting Fragmentation

The pandemic didn’t cause the explosion of choices, Jackson said, but it definitely kicked the process into overdrive, be it via new products like buy now, pay later (BNPL) or increased uptake of older services such as mobile wallets or digital marketplaces.


And that great leap forward isn’t suddenly going to step back as the physical world is reopening, but those innovations will still have to adapt to consumers returning to physical reality.

“Consumers are going to want to be able to use that new fragmented liquidity, tap it, consolidate it for physical purchases as we go into reopening,” Jackson said.


And there are brands that are moving to tap into the desire, he said, pointing to BNPL firms building marketplaces around their payments offering as an example.

Moreover, with things like mobile wallets allowing users to add speculative crypto like Bitcoin, the choices in the marketplace when it comes to buying, paying, selling and transacting are only going to keep on multiplying, he said.

In short, it’s an incredibly exciting time to be developing experiences for consumers and brands but it also has the potential to be an overwhelming and confusing time for consumers.

The Next Big Thing

Consumers have a lot of choice in where to put their money, and the traditional brick-and-mortar bank no longer has the advantage of being the only game in town, Jackson said. But banks do have an opportunity to rethink how they are proffering the consumer experience and evolving into a new role.


“There’s an opportunity here in the near future for banks to become the place where you consolidate your total 360 [degree] view of your financial position, no matter where it might be, to become a concierge to understanding where your net worth lies, how it’s being distributed and how fractionalized it is, with an opportunity to have some consolidations and management around it,” he said.

In much the way the retail store has evolved, so too can the bank branch. When Jackson said he wants to shop with Apple, he does it online — but goes to the Apple Store for the Genius Bar and special services he can’t easily do on his own.

Banks have an opportunity to redefine physical financial services in a similar way, he said. We’ve seen early signs of this evolution in the industry with the banking cafés that Capital One opened, for example. And although the cafés themselves have gotten mixed reviews, they do tell us something about what’s next in building the financial services experience of the future.

“Does it have to be a hangout and coffee bar where I’m going to play video games and open a checking account? Probably not,” he said. “But the bank branch experience of the future looks a lot more like that than it does the traditional teller-based model.”