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Beacons for Banks Let's Make Branch Banking Great Again

Beacons for Banks: Let’s Make Branch Banking Great Again

Are you resigned to the predicted demise of in-branch banking, or do you see your branches as indispensible sources of banking revenue and local intelligence for your enterprise?

If the latter is your viewpoint, you might wish to consider the benefits of beacon technology and marketing principles that surround it, commonly referred to as proximity marketing.

Word has it that this technology has the potential to get customers—millennials in particular—back into branches and to reinvigorate personal engagement between financial institutions and their customers.

Bringing Digital Smarts to Personal Banking

It’s no secret that bank customers are increasingly seduced by the convenience and immediacy of digital banking. Indeed, between 2009 and 2016, the number of brick-and-mortar bank branches operating in the United States fell by nearly 8%, according to the analysis of FDIC data by online banking resource DepositAccounts.

Number of US banks and branches 2004-2016

If predictions, such as those reported by The Financial Brand, are anything to go by, the decline in branch banking is set to continue, with branch visits by consumers forecast to fall by up to 36% between now and 2022.

Just like in the retail shopping environment, the beacon technology could be the key to reversing the negative trend in the walk-in banking. If so, investment in beacons may become an essential aspect of the in-branch banking strategy.

Banks Have the Advantage with Beacon Applications

It’s mooted that banks actually stand to derive more benefits than retail stores from various applications of beacons. For instance, retailers sometimes have a tough time getting consumers to download and engage with their apps.

Smart beacons in banks

Source: Reply – Back from the Brink: Smart beacons in banks part II

In their turn, banking customers are used to having banking apps on their smartphones, because they can actually do something useful with them—like checking their account balances and making payments or transfers. This way, one of the biggest hurdles to success can be overcome by using mobile app development services to integrate beacon connectivity into banking app software.

Why Now is the Time to Adopt Beacon Technology

Given that the Millennial population is the most tech-savvy one ever, and that this generation is least likely to spend time in brick-and-mortar banking facilities, fintech innovations like beacons and mobile apps offer perhaps the most persuasive path to increasing traffic in bank branches.

However, Bluetooth low energy (BLE) beacons have more than consumer appeal to offer your organization, since they provide the ability to capture as well as transmit data. In addition to boosting your marketing capabilities and improving customer experience, you can also leverage beacon technology to improve business intelligence and analyze branch performance.

A number of leading banks (including Citibank, US Bank, and in the United Kingdom, Barclays) have already begun deploying beacons on a limited basis to gauge effectiveness, primarily (but not exclusively) for marketing purposes. Now might be a good time to consider joining them if you’d like to start attracting customers back into your branches.

Get a Jump on Hesitant Competitors

cutting-edge-branch-banking-technologies

As the graph above illustrates, the latest World Branch Report from EFMA revealed that just 29% of banking executives believe beacons will make branch operations more advanced.

While there are always some risks attached to being an early adopter (many banks remain reticent about mobile technology, according to an American Banker article published in 2016), beacon technology presents opportunities to lure millennials away from less forward-thinking institutions.

If that sounds like an attractive proposition, you may wish to consider precisely how BLE proximity beacons can help to restore the relevance of bank branches. The following examples will help you get acquainted with the possibilities.

Examples of Beacon-based Customer Experience

Drawing customers in: They’re not called proximity beacons for nothing. BLE beacons are able to detect the presence of your customers at a distance of at least 50 meters. This provides the opportunity to alert customers that they are close to a branch and present them with reminders about their regular transactions, perhaps prompting them to come inside and strike a banking task off their to-do list.

Preparing bankers for action: As already mentioned, beacons transfer data in both directions, so when a customer walks into your branch, an integrated beacon and CRM software can ensure your banking personnel know she’s there, presenting tellers or banking assistants with the data they need to provide personalized services.

Welcome, receive, and assign: While your staff is presented with your customer’s profile, your customer can receive a personalized welcome message, select a service from the menu, be assigned to a desk or a counter and advised of the expected waiting time, all via the screen of her mobile device.

Time management: You know how meetings between personal bankers and their clients tend to overrun, but with beacon technology a personal banker can receive notification that the next client is approaching the branch, prompting the banker to politely end the current meeting and start the next one right on time.

A welcome distraction from waiting: Even if beacons won’t eliminate the process of waiting in line, they can at least make it a more engaging experience for your customers. Idle waiting time cries out to be filled with digital marketing content or helpful information, all of which can be pushed to customers’ phones while they wait for service. Isn’t that a more welcome distraction than watching Just for Laughs with no sound on a wall-mounted TV?

Shine a New Light on Branch Performance

The scenarios discussed so far in this article relate to beacons as customer-experience enhancers, but as mentioned earlier, proximity beacons can also channel intelligence data about your local clientele and even about the operational performance of branches.

For example, by integrating beacons with analytics dashboards, you can gather real-time intelligence to answer questions like…

  • How long do customers stay in our branches?
  • How many times per month does a customer visit a branch?
  • How long does it take to deliver a specific service (or complete a specific transaction)?
  • What are our branches’ busiest days and time periods?
  • What’s the average waiting time for service in each or our branches?
  • What transactions are most commonly conducted by our branch customers?

In turn, this can enable your management teams to ask (and answer) even more useful questions, such as:

  • How can we increase the number of branch visits made by our customers?
  • Which services take the most time to deliver and how can we shorten time to delivery?
  • Why do customers spend more time in branch X than customers in branch Y?
  • How can we increase teller productivity?

Productivity_average_transactions_processsed_per_teller_hour_worked-565x384

Further intelligence can be gathered by pushing surveys and questionnaires to customers—using beacon technology of course. Indeed, the same technology may even be able to solve some of the issues highlighted in your data analysis.

Enhancing, Not Diminishing the Human Touch

Perhaps you are of the mind, like many banking leaders, that the value of the branch is in the face-to-face interaction between the banker and the client, and that automation and digitization should remain in the realm of after-hours banking.

Certainly, this statement is totally valid. However, digital technologies like beacons and mobile apps have the power to strengthen relationships and make that human element all the more appealing.

When you add the intelligence capabilities to identify and realize improvement opportunities, as well as the fact that apps already play a huge role in banking activity across every generation, beacons in branches clearly offer potential value for your financial institution—or do they?

What’s Your Take on Beacons and Branch Banking?

Do you think beacons have a role to play in the revival of branch banking? How would you use them if you had them? Why is the percentage of banks planning to implement beacons so low right now?

As always, we love to know what you think of fintech and its place in financial services, so please feel free to comment on the facts and opinions from this article.

Darya Shmat

Darya has spent over a decade in the banking industry, working on various projects and in multiple capacities since 2003. In the early 2000s, a lot of the processes were manual, and no one had even conceptualized mobile payments and other technologies that are prevalent in the niche today. Darya witnessed the technological growth of the industry from within, as banks digitized and embraced mobile technology. Over the span of her career she has participated in a variety of projects that deal with operations automation, analysis, beta testing, auditing, efficiency evaluation, and other modernization efforts undertaken by banking institutions. She knows firsthand about the technological transformation that the banking industry is steadily going through. Today, Darya works as a business development representative at Iflexion and expertly applies her practical experience to help our banking and financial industry clients find the right development or QA solution.