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Generation B: Millennials and the resurgence of branch banking


Millennials, it seems, get the lion’s share of attention these days, especially when it comes to how this first generation of true “mobile natives” will interact with their financial institutions. And this has led the banking industry to develop and deploy digital banking assets throughout the industry—fast.

But true to their millennial form, this generation that prefers social to traditional media and values artisanal food and clothing is defying stereotypes by shape-shifting its banking preferences.

Bankers now know that while consumers enjoy the on-demand convenience of digital banking channels, they still very much value interpersonal experiences that only occur within the branch. According to a March 2016 Federal Reserve report, 84 percent of banking customers still visit branches regularly.

As a result, branches are enjoying a renaissance in terms of innovation and relevance.  And millennials are the primary drivers of this shift.  An August 2016 piece in Forbes by Shama Hyder makes it plain: Millennials are “the most non-homogenous generation in regards to lifestyle and shopping choices. While an older millennial may be married with kids, a younger millennial might still be in college.”

So what does this mean for bankers as they work to market to this group?

This millennial walks into a branch: It’s no joke

When millennials enter a branch, they expect a high quality customer experience with simple processes that dovetail with their digital banking experience. The Forbes article notes that “user experience, or UX as it’s called in the e-commerce space, isn’t just limited to the digital world. … This is a generation that doesn’t just appreciate a seamless buying experience, they expect it.”

Given that most branch banking activities weren’t designed with customer experience in mind, this gives banks an opportunity to rise above from the competition through branch tech enhancements.

Bankers can now leverage more innovative offerings: including self-service kiosks, personalized digital offerings, and on-demand printing of debit and credit cards through instant issuance. These draw customers into branches and encourage them to return regularly.  The demand for personal financial advice and the need for direct response to fraud or data breach have also changed the game. The seemingly least convenient channel has now evolved into an essential to establish, maintain and grow the bank-customer relationship.

This instant, the issue of instant issuance

To this end, instant issuance programs prove themselves as vital in today’s branch environment.  In the case of a retailer data breach, for example, an instant issuance solution enables a fast response and solution for the customer by producing a new and secure EMV-enabled card on the spot from within the branch. When new customers open an account, instant issuance expedites the process as it provides a fully functioning card immediately—as opposed to an anxious wait by the mailbox, punctuated by the inconvenience of lacking a card.

Without question, instant issuance programs help convert branches from service centers to profit centers. At its core, instant issuance exists to bolster customer satisfaction through an enhanced branch experience. It also enables financial institutions enjoy greater ROI from their card programs. Mobile-first consumers expect on-demand capabilities from service providers and with instant issuance, wait times for cards shrink from calendar days to coffee-break minutes.

On average, account holders use their cards within eight hours of receiving them. With a traditional, central issuance model, consumers wait an average of seven to 10 days to receive their cards. Even then, data suggests that just 90 percent ultimately get activated. With instant issuance, this attrition is eliminated as consumers take possession of a fully activated card, ready for use before they walk out of the branch.

The millennial-dollar question, answered

Today’s consumers, particularly millennials, look to their financial institutions to lead with innovative, technology-driven experiences that place emphasis on customer experience—while also making their interactions as quick and efficient as possible. Issuers that recognize the importance of positive experiences that extend into the branch will benefit from an understanding of how a larger technology-driven banking ecosystem should operate. It’s neither about the mobile app or the branch stop, but a combination. And to that end, branches may be shrinking in number—but not in importance.

Rob Dixon is the product manager for CPI Card Group and based in the greater Nashville area.