Sizing up its branches, PNC sizes down with the Tiny Branch

Imagine a mini-building small enough to store inside a large walk-in closet, and you’ll have an idea of how one bank out to reinvent the branch has dressed for success.

PNC Bank of Pittsburgh has built one of the world’s most unusual bank branches. It is the renovated interior of a steel shipping container, the type used to ship goods on the rails and on freighters. So far there’s only one of branch of its type and it is miniscule—only 110 square feet of office space inside, the equivalent of a closet measuring roughly 15 by 7 ft.

Fittingly enough, PNC calls it the “Tiny Branch.” And the portable unit travels by truck to high traffic areas, staying for a spell until PNC reassigns it to a new location. So far, it has been deployed in Chicago, Atlanta, and Charlotte—big cities for such a tiny branch—and just outside West Virginia University in Morgantown.

The Tiny Branch was launched in mid-2012 as part of PNC’s broad efforts to reconfigure its retail banking strategy—to acquire new households in locales and neighborhoods where, despite heavy foot traffic, people were unlikely to visit a bank branch. 

“We needed to transform our operating model from top to bottom,” says Brain Halloran, PNC’s senior vice president for retail innovation. Instead of following the lead of banks trying to rethink their retail banking strategies, PNC chose redirect its retail strategies by looking at the project “through the lens of our customers,” he says

“We’ve all been watching the not-so-shocking news that no one goes into a branch anymore,” adds Chris Hill, PNC’s experiential sales channel manager. But in assessing where existing and prospective customers already spend time as part of their everyday lives, PNC decided to go to where they already were.

The Tiny Branch culminates several years’ efforts to have bankers hit the streets, especially in the summer, at events such as at summer festivals where PNC would normally set up a tent. The pop-up tents were initially deployed to market PNC’s Virtual Wallet to new customers.

PNC also targeted markets where it considered its retail presence to be “thin,” compared to its peers, Hill says. Deployments are scheduled for periods lasting anywhere from 90 days to six months.

And here’s a telltale sign of the times: No tellers. Checks can be deposited or cashed at the Tiny Branch ATM. Still, you will find employees there. Bank staff from local retail operations spend time there chatting up customers, opening accounts for new households or servicing accounts for existing customers. Also crucial: PNC employees engage customers on advisory basis and tell them about the bank’s product offerings.

The Tiny Branch was introduced in Atlanta; the most recent deployment near West Virginia University lasted July through December 2016. While it was there, PNC found that the Tiny Branch proved an extraordinary magnet for customers and non-customers who wanted to use its ATM, which became one of the top five busiest in that marketplace.

PNC says the Tiny Branch has thus far achieved its purpose: to find new households for the bank unlikely to find traditional retail branches attractive. The numbers bear this out. So far, the Tiny Branch has generated twice the new households for the bank as retail branches within the same market, according to Hill.

That literally translates to big things in small packages, or big bang for the tiny buck, if you prefer. The Tiny Branch only requires electricity to operate and one full-time bank staffer; it   relies on other bank personnel already working in the market at traditional branches.

Though the branch now sits in storage, PNC expects to dust it off by late this spring—probably at a new university location, according to Hill. In the meantime, PNC may want to consider stashing its minuscule money machine in a fitting location.

Perhaps a bank vault will do.

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Sitting on back of a flatbed, PNC’s Tiny Branch awaits another unveiling. So far, it’s been a boon to PNC’s branch transformation efforts.

Next week on the BAI Banking Strategies podcast, we speak with CarrieAnne Cormier about customer experience, social media and the role of branches.

Robert Stowe England writes about retail and investment banking, financial markets and investing strategies. He is the author of five books, including “Black Box Casino: How Wall Street’s Risky Shadow Banking Crashed Global Finance.”