Expert: Banks must engage patrons

Kevin Rademacher

Wednesday, Nov. 17, 2004 | 10:55 a.m.

Despite the recent wave of technological advances in the banking industry, foot traffic at branches remains high as customers look for personal assistance with everything from deposits to car loans.

The John Ryan Co., a Minnesota-based consulting firm, said that the number of customer visits to those branches could be a bank's greatest asset, if they could just get those customers engaged.

Dean Silverman, a John Ryan director, is making that pitch this week at the BAI Retail Delivery Conference in Las Vegas. The banking conference is analyzing ways to improve service. Silverman is touting his company's Retail Banking Lab, a demonstration set featuring everything from touch-screen educational kiosks to flat-screen monitors featuring customizable signage.

"Of every 100 people that enter a bank branch, 98 buy nothing," Silverman said, adding that the low percentage makes improving the averages an attainable task. "If one more person steps out of line, that equals a 50 percent increase in sales ... One of the reasons that people don't buy something is that they don't know the bank has a product they want."

The tools pitched by Silverman are designed to interact with customers, such as kiosks that answer questions about loans and investments, then print out information customers can take with them. The technology replaces the need for banks to spend a fortune printing brochures that go unnoticed.

Another strategy is placing the kiosks and monitors in places where customers congregate, like in the teller lines instead of an out-of-the-way corner.

"We see it all the time, screens on a wall no one looks at," Silverman said. "People are spending a lot of money on the wave of the future, but nobody is getting it right."

Last week, Bank of America rolled out its newest branch design that touches on many of the same concepts Silverman pitched. The branch at 6610 N. Durango Drive was built to resemble a retail establishment instead of a traditional bank, with staff on the sales floor instead of behind imposing desks.

The architect of the branch design also designed the new Apple Computer stores and the flagship Toys 'R' Us store.

"They're designed not to be branches, but stores," said Steve McCracken, a spokesman for Bank of America in Las Vegas.

That retail approach has become even more important for banks as they have started to roll out new products such as investments and insurance.

Tom Mangione, president of Red Rock Community Bank in Las Vegas, agreed that banks must take advantage of branch traffic to make their sales pitch.

"Ninety percent of our deposits are done through tellers," he said. "The idea is how to we use that to sell other things."

Mangione said the high-tech features are not a likely to make fiscal sense in a community bank as opposed to a large regional or national bank, but he said they can compensate with well-trained employees. Tellers, he said, must know what products the bank offers and use conversations to identify needs.

"It really still is a people business," Mangione said. "You can have all sorts of technology and gadgets, but it gets down to the people."

Getting customers signed up for more products offers a big payoff and stability for banks.

"You want to have every customer have four, five, six products," Mangione said. "It makes a more profitable customer, but, quite frankly, it also makes it harder for a customer to leave a bank."