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October 4, 2005 5:35 pm

Accenture attempts to reinvent the bank branch – again

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Five years ago it was generally assumed that retail banks’ branch networks were an expensive relic of the pre-internet era.

Many thousands of branch closures later, the tide is turning. Giant video walls, radio tags, digital pens and personalised advertising are turning the scruffy high street branch of the last century into a powerful modern sales channel that is convenient for customers and profitable for banks.

That, at least, is what the IT consultancy Accenture hopes will happen, as it has been working with the industry to figure out what tomorrow’s high street bank might look like.

At its technology laboratories near Nice, in the south of France, it has set up demonstrations of how new technologies might transform branches in the future.

For the past decade, says Accenture partner Michael Redding, banks have been trying to shift their customers away from branches to cheaper channels such as fixed line telephones, the internet and mobile phones.

However, internet banks are little more than letters and numbers on a web page. They inspire little loyalty and rivals are just a click away.

“With the emerging channels there is no sense of direct relationship. Banking is becoming a commodity and churn is going up tremendously,” says Emmanuel Viale, manager at Accenture.

It turns out those expensive bricks and mortar branches did have a purpose after all.

“The branches are the channel that will help banks get new customers and retain existing customers,” says Mr Viale. “It’s the channel where you can go more towards personalising contact and relationship building.”

A return to bricks and mortar banking, however, doesn’t mean banks turning their back on technology. Even the writing implements in bank branches can profitably be replaced with digital pens, Accenture says.

These devices look and write much like an ordinary, if rather fat, pen – but inside, they have a camera, memory and a wireless transmitter. It records all the pen strokes and transmits them to a computer, where they are turned into digital text.

With one of these relatively cheap devices, technophobic customers can use the paper forms they’re familiar with, but the information can be captured and processed electronically.

Combining ordinary video displays with cameras and motion-sensing equipment, Accenture has also developed touch-sensitive video walls that are durable and relatively inexpensive.

Salespeople can use them to talk customers through a complex financial product, summoning experts in remote call centres to join in the conversation on video links.

However, video walls will find their most powerful applications in supporting seminars and group-selling projects, Mr Redding says.

Clever image analysis techniques can turn footage from surveillance cameras into detailed data of how people move around in a bank branch. Some top football clubs use similar technology to analyse the movement of players on the field.

For a bank, this can help monitor how queues form, which areas are too busy and which areas aren’t busy enough.

Royal Bank of Canada, for example, has used technology from Brickstream to analyse and optimise the design of its branches and set staffing levels based on live data.

“RBC said it improved branch efficiency 35 per cent,” says Mr Redding. “In the UK, Lloyds TSB also claims to have improved efficiency.”

Banks are constantly trying to sell existing clients new products and the branch network is a powerful tool for doing this. “One of the holy grails of banking is cross-selling. The more products a customer buys, the more profitable they are for the bank,” says Mr Redding.

Accenture is looking to help bank agents identify their customers more easily, so they can pitch services appropriately.

For example, banks could put a radio frequency identification (RFID) tag into each credit card, which would identify all their existing customers as they walk into the branch.

As they approach a teller, a screen would pop up on his or her monitor, with the customer’s name and other details.

Once RFID tags become cheap, as they are expected to, they could be implanted in leaflets. If a customer picks up a brochure about a mortgage, the leaflet rack records the fact. When the customer approaches a teller, he can propose a meeting with a mortgage adviser before the customer even asks.

The same technology can also be linked to an in-branch video screen. Once the screens know who is walking past, it can play a mortgage ad to the customer who just picked up the mortgage leaflet.

“Of course, this has to be done tastefully and sensitively,” says Mr Redding. “You could easily make people uncomfortable.”

But if the personalised ads are too invasive, customers will shun branches. And banks will be left holding their expensive relics.

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