Credit Union Management magazine’s Web-only “Facility Solutions” column runs the third Tuesday of each month.

The brand and how the brand is experienced have now surpassed convenience as the most important primary financial institution selection factor for consumers, per a recent JD Powers study. Branches remain the most effective way to develop deep, highly productive relationships with members. Further, branches have become the physical aggregator of all delivery channels in terms of choreographing the human-to-technology equation.  

All of this speaks to the idea that having a branch prototype that promotes your brand could be highly valuable for your credit union.

Many banks and credit unions are pursuing new branch business models and prototypes to help evolve their brands and cultures to increase member growth, share of wallet and return on investment, but how they go about it and the level of success it drives are very different.

A prototype is a well-defined and branded kit of parts that can be applied to a variety of branch sizes, configurations and locations while retaining the desired brand impact. Having a prototype supports a CU’s ability to roll out a branding package to existing branches in an economically feasible way and with a strong positive impact. It’s important to have documentation of the prototype sufficient to replicate the branded environment and results in future branches.

Indeed there can be a strong correlation between investing in a well branded, highly efficient and income generating branch and the investment this can take in terms of time and consultants.

For example, $1.35 billion North Shore Credit Union, Vancouver, British Columbia, decided to create a new branch business model and prototype that would help to rebrand its members’ experience and help the CU own its market.

Within five years of completing the prototype, the CU grew from $750 million to $2.2 billion in assets under management and added just one branch. This same scenario is being replicated by other credit unions that understand the value of the branch branding and prototype development process—it impacts member satisfaction, product use and account balances, staff behavior and success, and target community engagement.

North Shore CU did not bid the process so it could use the lowest price. Rather, leaders of the CU defined a clear set of goals, expectations and measurements systems, and pursued consultants who focus on branding and prototype development, as well as accelerating growth and performance, as their primary reasons for being in business.

Effective branding and prototyping new branch facilities can be unfamiliar territory. In some cases, credit unions have made small changes to the operations process and redecorated facilities, when more could have been done to increasing branch performance.

The difference between the processes can be defined a number of ways. The most important is the outcome. Determining the likely impact of a prototype initiative before it starts isn’t a perfect science, and yet much can be understood by looking at the elements of the process. Let’s look at three possible levels at which a credit union can engage in prototype development. Notice that there is some overlap, but the first level takes the initiative the furthest.

Brand driven with delivery channel integration

• Clear brand image and message at the center of all branch modeling and prototyping decisions. Requires a strong, embraced and finalized brand. Members, staff and board agree with the brand and understand what it is about.
• Understanding of members’, non-members’ and stakeholders’ (staff) brand experience expectations.
• Significant evolution of staff actions and the credit union culture to deliver brand promise. Has a real impact on human resources. A new environment engineered to promote specific actions.
• System-wide product and service delivery strategies and tactics promoted in each branch. How, where and when will mortgage, investments, insurance and wealth management be delivered?
• Delivery of a consistent brand experience through the branch and all delivery channels.
• Significant competitive differentiation.
• Enhanced security.
• All delivery channels orchestrated through the branch. Often requires systems modifications and enhancements.
• Integration of current and new technologies with the flexibility to accommodate change.
• A new high-impact merchandising and messaging system that measurably increases product awareness and brand clarity. Includes merchandising and messaging standards that can be replicated and used to help control the environment and member experience. Images and messaging must be aligned through all delivery channels.
• Demographic modeling in place to maximize positive impact of branch delivery components in terms of member benefit and the bottom line. Impacts location, size, brand components and balance of brand and community representation.
• New measurement systems to more clearly understand performance

Brand driven

• Clear brand image to drive all branch design decisions.
• Understanding of members’, non-members’ and stockholder’s (staff) brand experience expectations based on credit union team input.
• Evolution of staff actions to deliver brand promise. Impact on training.
• Modifications to the environment based on industry trends.
• Product and service delivery strategies and tactics promoted in each branch. How will mortgage, investments, insurance and wealth management accomplish these tasks?
• Competitive differentiation.
• Integration of current and new technologies with the flexibility to accommodate change.
• Enhanced security.
• A new high-impact merchandising and messaging system that measurably increases product awareness and brand clarity. Includes merchandising and messaging standards that can be replicated and used to help control the environment and member experience.
• New measurement systems to more clearly understand performance.

New look and feel

• Current brand image translated into the branch in terms of an updated floor plan, possible cash dispensers, new furniture, colors, and materials.
• Understanding desired experience based on credit union team input.
• Touch on how staff should perform differently in the future.
• Product and service promoted in each branch. How will mortgage, investments, insurance and wealth management be delivered?
• Integration of current and new technologies.
• New merchandising and messaging that promotes products and services with some brand interface.
• A consistent design that can be applied to future branches by reference.

One of the above, or a combination of elements, may be right for your credit union. Scale is often a deciding factor. For a small credit union, it is likely impractical to engage the full process due to limited internal resources, time and cost. But for larger credit unions the cost is small compared to the long-term benefits in terms of brand promotion and differentiation, and providing a powerful and engaging member and staff experience.

North Shore CU engaged the highest level of prototype development and design, and has since grown 300 percent in five years and been recognized by competitors as owning the market. While the initiative was a big investment, the CU will reap the benefits for years to come.

Paul Seibert, CMC, is VP/financial services of CUES Supplier member EHS-Design, Seattle.

You may also be interested in: Let a Prototype Be Your Guide