The newest alternate channel: Branch

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27 October 2010
Bart Narter
Visiting with lots of bankers and technology vendors at BAI, one hears a great deal about alternate channels, and multi-channel integration. My conclusion after all these discussions is that the new alternate channel is the branch. More customers use "alternate channels" such as internet banking, mobile banking, IVR and ATM, than use the branch. I think banks need to turn their thinking around and think of the automated channels as primary channels and the branch and call center as alternate channels when their primary channels can't do the job. Most new consumers have already changed their mindsets. Bankers would be well advised to do the same. Branch is the alternate channel.


  • Our research confirms that bank customers still care about the branch. The number one reason customers select and stay with a bank is location. This may change at some point, but we are not there yet. Bankers (and their vendors) use the term "channel", customers do not. We need to stop thinking about how we are organized and think about how our customers can best handle their financial needs. Depending on the need, the customer will decide how to best interact with the bank. The banks that win will be the ones who meet their customers needs and provide a superior customer experience across all "channels".

  • Yes customers care about the branch, but they visit less and less often. Customers are voting with their feet, mice and cell phones. Note that there are many branchless banks that are in the top 50 now.

    My conclusion: There are customer segments that value the branch and others that don't.

  • Bart - Nice thought that is on banks wishlist for long.

    The rate of adoption of alternate channels all over the world remains to be low and banks are waiting for the tipping point that can change customer behavior. The primary channel remains to be the bank branch for most customers.

    You may like to see an example of how are banks driving customers away from branch at

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