{"id":12277,"date":"2019-12-11T12:38:01","date_gmt":"2019-12-11T20:38:01","guid":{"rendered":"https:\/\/canary.kcprod.info/blog\/?p=12277"},"modified":"2022-01-11T17:12:20","modified_gmt":"2022-01-12T01:12:20","slug":"retail-branches-pose-an-existential-threat-to-banks","status":"publish","type":"post","link":"https:\/\/canary.kcprod.info/blog\/retail-branches-pose-an-existential-threat-to-banks\/","title":{"rendered":"Retail Branches Pose an Existential Threat to Banks"},"content":{"rendered":"\n<p>There\u2019s a battle for branch expansion among banks in the U.S. today. Both J.P. Morgan and Bank of America, for example, have been duking it out to open a total of 180 new branches across the country this year alone as well as \u201cmodernizing\u201d existing branches. This battle is completely misguided. It\u2019s analogous to being on the cusp of the automobile taking off and deciding to double down on the horse and buggy.&nbsp;<\/p>\n\n\n\n<p>We can\u2019t entirely fault banks here. It\u2019s hard to let go of something that once propelled your entire business to near-monopoly status and became core to your success with consumers. But the bank branch model was created by baby boomers for baby boomers, and there\u2019s a new generation in town that wants something <em>very<\/em> different. But instead of facing the music and offering today\u2019s consumers what they\u2019re really asking for, banks put together focus groups who come up with ways to draw the under-40 crowd to branches. Their uninspiring ideas included serving food and drinks, updating their furniture, and keeping advisors around to sell their products.<\/p>\n\n\n\n<p>We saw this absurdity start to take hold in 2016 when <a href=\"https:\/\/thefinancialbrand.com\/61682\/capital-one-bank-branch-cafe-design\/\">CapitalOne refashioned several branches into caf\u00e9s<\/a> offering coffee and snacks. Despite these efforts, when we survey our clients under the age of 40, we see a clear behavioral trend that does not map to these modernization and expansion efforts. There is a growing trend of what we call \u201cbranch-nevers\u201d emerging among people under 40 in the U.S. In fact, 30% of our clients are fully digital, meaning they haven\u2019t visited a bank branch in the last year, or ever. 80% of our clients haven\u2019t ever visited a bank branch for any type of advice or education.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1263\" height=\"530\" src=\"https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/our-clients-dont-visit-bank-branches-1263x530.jpg\" alt=\"\" class=\"wp-image-12286\" srcset=\"https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/our-clients-dont-visit-bank-branches-1263x530.jpg 1263w, https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/our-clients-dont-visit-bank-branches-640x269.jpg 640w, https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/our-clients-dont-visit-bank-branches-768x322.jpg 768w, https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/our-clients-dont-visit-bank-branches-1536x644.jpg 1536w, https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/our-clients-dont-visit-bank-branches.jpg 1995w\" sizes=\"auto, (max-width: 1263px) 100vw, 1263px\" \/><\/figure>\n\n\n\n<p>Checks are also becoming a thing of the past. We found that one-third of our clients have never written a check. This probably sounds crazy to baby boomers.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1472\" height=\"498\" src=\"https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/check-1472x498.jpg\" alt=\"\" class=\"wp-image-12289\" srcset=\"https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/check-1472x498.jpg 1472w, https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/check-640x217.jpg 640w, https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/check-768x260.jpg 768w, https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/check-1536x520.jpg 1536w, https:\/\/canary.kcprod.info/blog\/wp-content\/uploads\/2019\/12\/check.jpg 1995w\" sizes=\"auto, (max-width: 1472px) 100vw, 1472px\" \/><\/figure>\n\n\n\n<p>Wealthfront is in a fortunate position as a newer entrant to the banking space \u2014 we can start with a clean slate. We don\u2019t need to worry about legacy business models or fret about what we\u2019re going to do with thousands of retail locations. Instead, we can listen to the modern consumer and build a new service that fits exactly what they want: making more money on all of their money. We can also steer clear of what they don\u2019t want, like <a href=\"https:\/\/canary.kcprod.info/blog\/millennials-and-bank-branches-a-bad-match\/\">paying $200 a year to support branch locations they don\u2019t use<\/a>. We\u2019re excited to continue building out our nextgen banking service for you.&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>There\u2019s a battle for branch expansion among banks in the U.S. today. Both J.P. Morgan and Bank of America, for example, have been duking it out to open a total of 180 new branches across the country this year alone as well as \u201cmodernizing\u201d existing branches. This battle is completely misguided. It\u2019s analogous to being [&hellip;]<\/p>\n","protected":false},"author":7,"featured_media":12284,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[1315,2390],"tags":[2374],"coauthors":[1036],"class_list":["post-12277","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-industry-insights","category-saving","tag-banks"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Retail Branches Pose an Existential Threat to Banks<\/title>\n<meta name=\"description\" content=\"There\u2019s a battle for branch expansion among banks in the U.S. today. 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