High-Tech and High-Touch;…YES!

Thursday, June 29, 2023  |    Becky Summers, Thought Leadership and Strategic Guidance

While the virtual world continues to entice consumers, the demand for online banking has remained a game-changer and transformed the way many of us manage our finances. But the need for an in-person branch persists, and surprisingly is becoming quite popular among younger generations. Regardless of the digital prowess of these younger consumers, the data shows that for navigating complex financial needs, the guidance of in-person experts within brick-and-mortar branches remains a high priority.

Figure 1: Branch Usage Among Generations

Branches Are Not Dead!

Source: Raddon Research Insights, 2022 Delivery and Payments

In the chart above, 86% of Millennials reported branch or drive-up usage and of this segment, 30% indicated they plan on using the branch more than prior to COVID.

But how are they doing business with us?

Younger demographic groups are much more likely to perceive the primary role of the branch for account opening and a source for financial advice. In contrast, individuals in the Baby Boomers and Traditionalist Generation segments view the primary role of the branch as a place for conducting transactions. 

Figure 2: Ways Consumers Conduct Employee-Assisted Transactions in a Typical Month

Younger Generations Have a Higher Usage With All Employee-Assisted Channels

Source: Raddon Research Insights, 2022 Delivery and Payments

Raddon Research Insights found that 76% of Gen Z and 80% of Millennials conduct in-person branch transactions within a typical month. These segments also use the drive-up Lane and telephone calls at a higher rate than both Gen X and Baby Boomers. Let’s face it…they use all the channels more than others. So where does this leave our branch strategy?

Leverage an Integrated Delivery System

To leverage an integrated delivery system, you need to define your network strategy and develop a roadmap. This integrated delivery will be both a high-touch and a high-tech plan.

  • Consumers use branches differently based on demographics. Millennials and Gen Z are more likely to visit for more complex servicing reasons, while older consumers prefer to use tellers for routine transactions like deposits and withdrawals.
  • Online banking is the most used self-service channel among baby boomers. Millennials rely heavily on both online and mobile banking.

You need to start with a focused approach to discover opportunities within the market you are serving and understanding the impact of your current branch network. Research and an increased knowledge of your current locations within their markets will provide you with a way to develop the overall strategy and roadmap for the future. Next, layer that onto the mobile and online banking usage from your accountholders.

Benjamin Franklin once said,
“By failing to prepare, you are preparing to fail.”

First consider your high-touch delivery. While this research is necessary to determine market and branch location opportunities, you must be sure you are considering the entire network evolution. What is your multi-plan approach to the future as you are in this planning phase? Once you have determined that, you will need to be sure current and targeted locations fit into that strategy for a holistic market approach.

Next, you will need to understand current and proposed markets in conjunction with each other. This is achieved by performing a market discovery to discover performance of your current branch network. This will enable you to use data about your proposed market areas to set clear goals and objectives. This encompasses conducting a thorough assessment of the market, identifying its current strengths and future opportunities. It is important to consider various factors such as generational segments within the market area, potential population growth, and even the saturation level of competing banks. These considerations will enable you to pinpoint potential market strengths and make informed decisions for your business's success.

Now back to high-tech. Earlier we learned mobilebanking has grown to a 75% overall adoption rate. The younger generation segments have an even higher mobile usage as illustrated below from a recent Raddon Research Insights report. The likelihood to use mobile banking has increased with the younger generation segments. While many consumers utilize mobile banking at high rates, remember they are still using in-person branches as well for advanced service needs and typical daily transactions–hence the high-tech, high-touch approach.


Figure 3: Mobile Banking Usage

Percentage of Mobile Banking Over the Last Severeral Years

Source: Raddon Research Insights


But what should the focus be for your high-tech strategy? 

  • Mobile features like remote deposit capture soared in popularity during the pandemic. Enthusiasm for mobile features has not waned; compared to 2019 levels, usage of all mobile features is higher today
  • Digital wallets and person-to-person (P2P) payments have become part of daily life for younger
    and affluent consumers
  • Be sure your institution is easy to do business with across all your digital platforms. Consumers do not want to “figure it out” based on the products they have. The user experience should not disincentive usage of your payments or mobile channels

Figure 4: Current Usage or Likelihood to Use of Mobile Banking Features

Quick and Convenient Features Are Gaining Popularity with Mobile Users

Source: Raddon Research Insights, 2022 Delivery and Payments

Convenience and ease-of-use continues to be on the rise when it comes to banking, whether that is in-person or online. Having easy security logins are attractive to consumers, and Touch-ID has increased significantly in popularity since 2021.

Next, you will need to define the specific goals and objectives for your financial institution within the market and channel usage.

  • For branches, if you are considering one or many locations, you should determine the network roles and investments that will be necessary. Not only are you setting goals and objectives for potential expansion markets or branches within markets, but you also need to consider any current branch’s performance through a thorough branch performance assessment with the current network and then make adjustments for the expanded network
  • For digital, consider current usage of channels, potential growth of consumer segments that will lead to increased usage and the appeal of adding channels and delivery for each of the added services offered
  • All these considerations must be able to fit into an optimization strategy and roadmap

Overall, you should be sure you are focused and have a roadmap for your future.

Raddon Report

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Thank you

Your inquiry has been successfully submitted and is now being routed to the appropriate member of our team.

Want to ask us a question?
Interested in our services?
We’re here to help.




2900 Westside Parkway
Alpharetta, GA 30004

Contact Us   |   About Raddon   |   Careers   |   Privacy Policy   |   Terms of Use

© 2023 Fiserv, Inc., or its affiliates.