Data Drives the Future of Branch + Digital Distribution in Banking

Jim Marous:

Hello and welcome to Banking Transformed the top podcast in retail banking. I'm your host, Jim Marous, owner and CEO of the Digital Banking Report and co-publisher of The Financial Brand. Today we're coming to you from The Financial Brand Forum, the largest event in retail banking.

Financial institutions big and small are trying to determine what's the right mix of physical and digital. Some organizations are building branches, others are tearing them down. But no matter if you're building or tearing them down, you have to be able to figure out what does a distribution network look like and where is it located, and this is driven by data and analytics.

My guest today is Gina Bleedorn, the chief experience officer at Adrenaline. Gina's going to share some insights into what are the trends in retail banking today with regards to distribution networks, how do you solve for those things such as where my customers are going to want to bank, and how to deliver the services they want. More importantly, she's going to share the mistakes that banks make in trying to transform their branch network.

So welcome to the podcast, Gina. I can't believe we've been doing this for three years now, the podcast. We've known each other for about 10 years now and we've never gotten together in an interview type situation like this. And I find you to be one of the most knowledgeable people in the industry around channels because even though Adrenaline works around specifically mostly branches and all that, the reality is it's all about the experience. And as the experience officer, you really have to say I can't be biased. I got to make sure that the end result is great for the customer.

So since COVID, what has been the biggest change in your business, but also in what you're helping financial institutions with?

Gina Bleedorn:

That's a good question. I would say a change in expectations from consumers first, from our clients second, in that everyone's expectations got put on pause and then they shifted to really expecting a level of service and delivery and understanding of needs and empathy I think, that didn't previously exist as much as they need to today. And so, everything had to be rethought.

And so for our clients, that has meant they need to rethink every aspect of how their brand manifests itself in all of their channels. They have had to rethink delivery of service, both physically and digitally and balancing the two human digital, physical, phygital, whatever you might call it and that's in many cases a nearly impossible ask. And they have had to deal with technology and having to implement technology in a way that they never had before.

And so as we're serving them, knowing that their customers' expectations have shifted, we have had to shift too to be more agile and be even more on top of what is happening so we can advise them correctly because ultimately, I want everything we do for our clients to be in service of where the industry is headed. And in this time of great change and uncertainty, it's never been moving and accelerating so fast.

Jim Marous:

I mean, I say in my presentations, it's never moved this fast before and it's never going to move this slowly again. So it's not like in the past in banking, you used to say, well, it gets ramped up, it gets ramped up, it's like a thermostat. Well, this is like, it's only one direction. Once you go over a mark, you got to go further over that mark.

And it's interesting because it's different for every institution. We've talked about the fact that a solution for one organization's going to be different for another. I told you the story about this last weekend when I was in the central part of Georgia and I saw 52 cars in line to go to a branch auto teller, nobody was in line for the ATM, and there's a line out the door of customers. And I hadn't seen that in 40 years since I was in the beginning of banking before direct deposit.

But we think in our mind that everybody's kind of the same. But not only are your customers vastly different, but organizations are. So I would imagine at Adrenaline, you need to do ... one of the first steps I would imagine is doing a level set on where is this today and what are your customers like.

Gina Bleedorn:

Yes, yes, and yes. The more unique you are able to shape any kind of experience, the more meaningful it will be. And yes, for us, when we are engaging with a client, we have to get uber localized to their world and uber immersed in who they are and thus who their customers are very, very quickly to understand exactly that industry nationwide trends are just that, they're the mean, they're the average and they can wildly vary.

Just as you saw in Milledgeville, we have seen the same, things that you assume and then you get in, into different markets with different nuances. And actually I love that because we learn about challenges we didn't even know existed somewhere else.

So the nuancing of yes, understanding each market, metro, rural, North, South, East, West, a part of the country, other nationality influences, ethnicities and just cultural proclivities, that is absolutely necessary to make an experience meaningful.

Jim Marous:

How do you do that when you're sitting down? Let's talk about a first visit. A financial institution says we need some help in the rebranding of our distribution networks, where do you start, if they've only defined it that roughly, as opposed to we need to close four branches?

And it used to be the opposite, we need to redesign seven branches, and I'm sure you still get some of those. But somebody comes in and they set the level, they set the playing field saying we just have to re-look at our distribution network. Where do you start? What are the challenges you have in that definition?

Gina Bleedorn:

Yeah, good question. I would say this, the way we really start in with any client is to immediately understand the basic analytics of their footprint. And when I say analytics, I mean just where are they. And inherently, because we do this a lot, you start to realize, oh, they're in these markets in Dallas that are obviously their growth and these smaller markets that are going to be their legacy. So looking at a footprint just even on a map is almost the first place to start.

And what that's telling us is, I guess two basic things, how big are they, because inherently a 10 branch versus a 50 branch versus a 250 branch, you inherently start to make assumptions to be validated on their general adoption of technology, their general awareness of what trends are out there.

But then you start to look at regionality and probably more than anything, metro, rural, how urban are they versus rural, and how growth market oriented are the markets they're already in. And then so looking at those maps, you start to have a sense of I bet they're probably moving here, I bet they're probably trying to downsize here.

But that quickly gets into your question, what do we ask them? And one of my first questions is around technology adoption. Where are you with technology is one of the first basic questions.

Jim Marous:

Not technology adoption from the consumer, but from the bank's perspective then?

Gina Bleedorn:

Exactly, specifically to their retail delivery. So things like, for instance, TCRs, teller cash recyclers, universal staffing, those are some of the core questions. Some might say yes, we've rolled that out everywhere. And suddenly that gives me a sense of the sophistication of okay, they've already reduced staff enough, they've brought in automation technology or not, or we're halfway there. And that's one big piece.

The other big piece is in self-service technology, where are you in that spectrum, a lot of it around video tellers and ITMs. And so those two big questions start to shape our understanding of a current state, but then very quickly get into what are you trying to achieve.

And really there is growth and there is savings, and everyone is on a spectrum somewhat. But for the most part, what I continue to find when I say are you really trying to save and take cost out or invest in your network, I continue to find most of them are on the side of growth. They want to save also, but they want to do it to fund the growth. And so those are some of the key level setting questions to know where are we even starting here.

Jim Marous:

Growth as far as customers or growth as far as branches or distribution?

Gina Bleedorn:

Yeah, great question. In many cases both, and growth as far as even investment in the physical channel. So they are taking cost out, but a lot of that is to reinvest the money back in. So what I continue to find is branch delivery and retail delivery that was once ... For many years, the branches were going to be dead. They were supposed to be dead like 20 years ago I think.

Jim Marous:

Exactly.

Gina Bleedorn:

And that has faded out. There is a permeation of assumption now that there is a real value in physical, it just needs to change. And so you're not convincing. And what I do find is they're wanting to invest, but they're also wanting to save so they invest in the right way.

Jim Marous:

So when you talk about the want to invest in physical, is there ... We're talking a lot of the dynamics here from institution to institution. There's no one right way from a standpoint of what that physical's going to look like, is it? It really is based on the brand, isn't it?

Gina Bleedorn:

Yes. We talk about formats, but really there's some basic footprints, a big hub branch, a smaller spoke branch, maybe a staffless branch, but these are just blueprints. Everything else around what the branch experience should be, should be highly bespoke to who you are, to who your people are, your markets.

And what we're starting to see emerge that we love is more innovative and bespoke-like concepts that are structured around their business needs, some being around wealth and around commercial for instance, creating what is the role of the branch for a commercial bank?

Well, if you ask a number of older school minded commercial lenders or even bank executives, they'll say not much. But what we're finding now is actually, wait a minute, a branch is an opportunity to recruit banking talent. It's an opportunity to have a place to bring your business customers, for instance. You can have a lounge for their use. You can have meeting rooms for their use. And in our world today, those have even more value.

So innovative concepts like that, those are what are emerging as creating new purpose in a way that's right for your business and your market.

Jim Marous:

So how long have you been with Adrenaline?

Gina Bleedorn:

20 years, Jim.

Jim Marous:

What's interesting because at the early part of your career, we were looking for what's the best looking setup for a branch.

Gina Bleedorn:

Yeah.

Jim Marous:

There is no model right now. I tell people, I said, why is Chase Bank building a lot of branches? Well, they're building them in areas where they have a lot of credit card customers, but very few distribution networks, and for them they're expanding their relationships. Capital One, very much similar where they're playing off their credit card base, but they're looking at one unit per metro area.

On the other hand, your community bank has vastly different objectives. And where 20, 15 years ago, you end up in a situation where you could determine what kind of branch you needed by demographics, demographics doesn't define anymore how a person banks.

I mean you have seniors that are using digital, you have younger people that don't want digital. Now they're not the massive markets, but how they view a branch and the billboards aspect of it that you mentioned.

But what has been the biggest trends over the last three years that you've seen? And I know some of the trends end up being just short term trends, you have somebody that doubles down on something, they get a lot of press and it really doesn't work to what we thought it would be.

Gina Bleedorn:

Right. Yeah.

Jim Marous:

What are the trends right now that are working?

Gina Bleedorn:

I would say one of the big trends that's come, gone and then come back in a slightly different way, things like the café model. And we worked with Capital One on their first cafés when that was really modeled after ING, which had a beautiful café model and now has been extended in different ways with Capital One.

But I think that model became really hot for community institutions, but then they realized that a café only comes with it some confusion. Why did the bank open a café? What am I supposed to do there? However, when coupled with a branch where it's just a café on the side, those are strategies that become community use gathering, but there's a little modicum of separation and then here's the bank. That's an interesting example of a strategy that came, went and was slightly changed.

But there's been a lot of other things, put up iPads. I had so many clients say, "I want iPads in my branches because they look cool." And we would say, "But what are they doing?" And so for some we created experiences, but ultimately using devices like iPads in branch, certainly touch screens, don't do that. People want to use their own devices. Those are the most valuable devices. And so digital screens should be outward facing messaging but not interactivity.

So those are some little trends, but the biggest macro trend we see is around self-service technology. And one of the things, to your point about demographics, we have worked with a number of smaller just community banks of all sizes and community credit unions of varying sizes that have had a lot of great experience opening smaller footprints utilizing self-service technology, micro formats, in some cases staffless formats and even just remote only with video tellers, ATMs, advanced ITMs.

And these are working so well even in markets that are older demographics, that are more rural demographics and they are ideal for markets where maybe market potential is not quite as great and it doesn't warrant a giant big branch investment but it warrants something. Or you're trying to softly exit the market and you want to leave behind something.

And so these self-service touchpoints are small formats. They're an eighth of the operating cost or an eighth of the CapEx expense to put up, but they count as points of presence in serving your customer. And still, the number one driver of new customer acquisition is perceived convenience or perceived ubiquity.

And those type of smaller touchpoints, in many cases, they over index on what you're spending for them in their perceived convenience factor. And I think that's the biggest trend that really matters right now as banks and credit unions are thinking about what to do with their retail distribution.

Jim Marous:

So your client base, when you're looking at what I'll call the most progressive, however we want to define that, I'm just floating by that one, how do you measure success with distribution? Because Capital One will say it is as much about the brand. Those units do not have a return on investment that they want people really to dig into because it's more than that.

And Capital One's a unique situation, I don't want to use them as a model just like I don't want to use Chase because it's serving something that ... Maybe there's two other organizations in the world that have the customer base that's not branch based that you can use it. But when you're working with organizations, how do you want them to define return on investment and if it worked?

Gina Bleedorn:

There are certainly your standard metrics, revenue per FTE, efficiency ratios, deposits per FTE, those matter for sure and track them and they are important. But I would say one of the biggest metrics, and it's not an immediate one, is just simply market share percentage growth. So what is your fair share of the market? Are you getting it and is it increasing?

Because we have a number of clients, or there's many banks and credit unions out there, client or not, in big growth markets that are killing it right now because the market is killing it. And that's good, but how you really measure success is your relative percentage of market share because regardless of how the market is doing, that's showing that you're over or under indexing on getting what you could. And that is factoring in the halo effect of your brand and even your branch presence.

We say, and Chase knows this, those branches, a lot of people are not even ever going in them, but because they're in the market ... And of course, again, Chase has got its own different marketing budgets and such, but they know they're going to go into a market, they're going to blanket it and that perceived presence of they're here, they're everywhere if I need them, that's leading to acquisition.

So there is an untracked and hard to measure exact ROI of what did that exact branch do. They're measuring what accounts are opened there, and of course new account opening, another major metric, but think of the market in totality because they may never go in that branch. They may open it online, but that branch investment might be why.

And when it comes to community banks and credit unions, you cannot outmarket Chase, Capital One, national banks or any FinTech, you cannot. They were built as digital marketing entities. So your physical presence is a way to combat that and drive acquisition. So yes, I think percentage of your fair share of your market share gains is the most important metric.

Jim Marous:

So before we take a short break, I'm going to ask you one more question. It's around relative value. You can build a branch, but if the branding's off, if you're digital marketing is off or your marketing in general is off, if your new account opening process is broken, if it's taking 15 minutes or if it's clumsy and it's not really even good in the branch, you end up getting false reads.

Gina Bleedorn:

Right.

Jim Marous:

How do you work with clients on the outgrowth of what that unit's supposed to do, but other things that may be broken that can make it so that the entire team's not working together?

Gina Bleedorn:

That is a really good question, Jim. It's like an orchestra that the trombone section might be killing it, but if the drums are off or the violins are slightly sharp, it's not going to work no matter how good the trombones play. So to your point, it is a careful orchestration.

I would say this though, the flip side of that is when trying to fix everything it becomes overwhelming. And so we've been part of branch transformation, network transformation projects that got too big, too fast because of all the problems being identified.

So when we come in, we triage and there is an order of magnitude, order of importance and it's entirely in our opinion based on experience impact to the customer and the staff, because staff by proxy to customer, how big is the experience impact of what we're talking about?

So if it's something about online form automation or something that maybe is a little bit down the funnel or a biometric thing you want to get going that's not working yet, those things matter, but on the impact scale, where do they fall? Because if major things aren't working then nothing else works after that. So I would say everything needs to be evaluated on a customer impact scale and with a staff impact scale closely aligned right next to it.

Jim Marous:

So we're going to take a short break now and recognize the sponsor of this podcast.

Welcome back to Banking Transformed. So my guest today is Gina Bleedorn from Adrenaline and we've been talking about the change in the distribution networks and the way organizations are looking at branches, digital and experiences, and more now around engagement.

So Gina around the concept of engagement, we're finding that it's not just the experience we want, we want consumers to engage with us in different ways. I would imagine the branch plays a major part of this. As much as we sometimes, some of us that want branches to go away or think it's not needed and now have been converted to saying it's not going away for a long time, branches become part of that engagement, don't they?

Gina Bleedorn:

Yes. And actually they're a precious opportunity for engagement in the world as everything goes digital, as you get the transactions out. And everyone's always said they want the transactions out operationally, but you have an opportunity for human engagement.

So in a way it should be the pinnacle of thinking about what that engagement experience is and how do you enable that with the environment, with the staff, with whatever technology that is helping the staff or helping the customers. And technology should do just that, it's a thing that enables experience, not just a thing you shove in the corner and hope people will use.

So yes, engagement is everything and those experiences as they become fewer, they are more important. A customer will remember for years an in-branch experience that they had that was good or that was bad.

Jim Marous:

Yeah, because nobody says gosh, I want to go to the branch. I'm sure there's some but not many that say I really want to go to the bank. So we have to make those experiences different. And we all made so many adjustments.

I mean my personal, my business branch I should say has a person that's a greeter but not really a greeter. It's one of the managers and he's going to take care of whatever it is. And sometimes I'll go in there and have a question and if it needs the platform, they're sending you back home to set up an appointment. So that's a concept that in my mind has gone wrong. It's gotten too structured.

When you're meeting with organizations and they leave an open pallet again, they go, "We need to look and restructure our branch network. We need to get rid of some, we may have to change others. We need to fix things," what are the biggest challenges financial institutions are having today in making that adjustment?

Gina Bleedorn:

The hands down answer is staffing. Humans are not machines and we can't push out updates to our branches like app updates. And so the complexity of the human factor suddenly becomes in a way the greatest limitation, we talked about engagement, of creating the engagement because it's not only being able to train the right people, but being able to find the right people, and that has never been harder.

But right after that, I would say it's about technology. Most clients that we work with, they know the technologies they're supposed to be buying, like I think I'm supposed to buy these ITMs, but I don't know what to do with them, and they're not thinking about, again, the whole experience in totality, what is it for.

So number one, the staffing, number two, the technology. And then number three is the hurdle of getting over we're doing it this way because that's how we've always done it.

Jim Marous:

I would imagine that's just like we're doing it this way or we're going to be doing it this way because somebody else is doing it this way. Different side of the same coin.

Gina Bleedorn:

Exactly, that looks good, I'll do that. And so suddenly you end up having repetition of very expensive deployments of physical branches that are being just done over and over again by maybe your real estate team, your facilities team, and they're doing their job, no one's at fault, but often we see somewhat of a lack of innovation in the branch channel that ends up with a step and repeat approach. And when it comes to retail delivery, you cannot have a step and repeat approach, it has to be an iterative approach.

So we talk about it being a north star that is always evolving. You're never actually there. You don't have a branch of the future because the future's never actually here, but there are so many branches of the future. It's ironic. But really if you think about retail delivery as having a north star of experience that is always changing as your institution changes, you merging, you're moving as the market changes, then you can always be tracking towards that.

And hopefully every new iteration that again are expensive iterations of brick and mortar in the ground that will be present for potentially decades and decades, if you can try to step forward with each iteration towards that north star, that's got to be the way you think about it.

Jim Marous:

So in that same sense, if I'm building a new branch today and let's say it's more of a traditional branch, how do I future ready it? What are the ways that organizations are now saying I'm not too sure for where we're going to end up and I'm certainly not sure if this is where I should be today, but what does that branch look like? And gosh, I'm getting into trouble here because everything's based on what the company is and everything like that. But let's take what your ideal branch is in an ideal market that I'm building, what does that look like?

Gina Bleedorn:

So let's assume that you've already had the right metrics to say I should be in this market, it's a growing market, and you have a sense of maybe how big it should be, I want it to be a flagship. Maybe it's 3,000 square feet. That's a fair amount. So here's the things you need to think about.

If you are building new branches with a traditional teller line, please stop because that is not what you should be doing. That is creating barriers, infrastructure. And even if you put TCRs behind them, you are not getting the benefit of what TCRs were made to do, which was enable dialogue banking, enable staff reduction because they have the freedom to flex into greeter or to flex into drive up. And I keep coming across deployments where that's step and repeat.

So you should absolutely be moving towards an open plan environment. TCRs are more secure literally, but the experience impact of the staff and the operational impact is just hands down where everyone needs to be going. But that's been the case for 10 years depending on where you are. We may not be there yet, but that's your baseline.

But from there, two other big trends that we see, one being video enablement. I think the branch of the future needs to be planning for video integration, on-demand experts. I'm able to actually do, as a banker from the bank branch, my place of work, video calls with customers and, or I'm able to take a customer to do an on-demand expert video call that they can be alone or I can go with them. So video enablement in that capacity, that's-

Jim Marous:

Especially now after COVID. I would imagine that nobody's afraid of the video anymore.

Gina Bleedorn:

Exactly. We all got Zoomified. We know how to do lots of things with our pajama pants on, although in the bank branch you try to wear real pants.

Jim Marous:

Probably not in the bank, but we see them.

Gina Bleedorn:

Yeah. And so yes, video enablement, but then on top of that, flexibility in layout. The days of the big heavy infrastructure, marble, panel wood everything, no, flexibility, because as technology evolves, as your space evolves and even for reconfiguration for things like events, repurposing, using it after hours, a lot of flexibility in space. And the open plan helps enable that, but reconfigurable-

Jim Marous:

Which makes it so you can go to the future.

Gina Bleedorn:

Exactly. Reconfigurable spaces, those are ways to future proof. So definitely move towards automation, open plan and flexibility and space utilization. That will allow for technology integration as things change.

Jim Marous:

Okay, let's take the opposite then. We have a 14 branch network, we've come to the conclusion along with Adrenaline that we probably need 10. What is the correct way to close the four, and assuming this is a legacy branch network, to retrofit the 10 that are left?

Gina Bleedorn:

Oh, I've met you before. So the secret with that is to close but seem like you're reinvesting, and in a way you are. The big question of which do I close has to be data informed but not entirely data driven. Data is going to ultimately drive especially which could be closed. Overall market opportunity will govern, that's the most important thing. How much growth is there that you could capture, not necessarily how much you already have?

But then after that, proximity, drive time. You want to be able to close branches with the least impact to current customers. So those are some easy factors there. But here's the flip side of how you actually reduce and save at the same time.

If you reinvest in a smart way in the other branches, enhance them in at least a minor way, so that, yes, I closed this one but I enhanced this one. It actually appears like we are putting money into our network to be make a better experience, which you are.

And also analytics can help guide how much you should spend. We always say you do not want to over renovate an existing branch. You want to only renovate as much as expected new fair share capture will support. And so that can give you some tiers of renovation.

So basically, in a simple way, an A, B and C and D, the D branches are my closures. The C branches I put a little bit of money into and just maybe a little paint, some new merchandising. Then maybe the B branches, I'm a little more than that, new carpet, new flooring, new lighting. And maybe there's one or two A branches that get a decent renovation.

And maybe if they're not up to speed with our latest branch experience of moving to universal staffing, we're bringing in new models of doing business. But certainly you don't want to over renovate. And that idea you said earlier, nothing is one size fits all. You have to be flexible and commensurate to the opportunity in the market with your spend at every branch.

Jim Marous:

It's a lot about also, as I've heard from actually Synovus, that you have to educate the employees that are being impacted, so that they buy into it before you pretty much over anywhere announce it because they've got to feel like ... Because again, branch employees feel like the enemy is the digital when it doesn't have to be. Their job can actually be enhanced by that.

But if you don't communicate it out to the employees first, it doesn't matter how good the other branches are, the employees aren't ... And they're the only front people. You come up to my window, they're going to go, "By the way, they're screwing me here." And the consumer's going to buy into that because that's the relationship. That's what we're trying to support.

So what is the biggest mistake banks are making right now in their rethinking of the distribution network?

Gina Bleedorn:

I see two big things. One is technology deployed, especially self-service technology, most notably ITMs without a solid, fully-baked strategy as to where they should go, what infrastructure should be around them, and how they should be actually encouraging both staff and customers to adopt them. So-

Jim Marous:

If you build, it does not mean they will come.

Gina Bleedorn:

If you build it, they will not come. They'll come but they won't use it.

Jim Marous:

Yeah, exactly.

Gina Bleedorn:

Absolutely. So really self-service technology, especially ITMs.

The second thing is just not being data informed enough. I continue to see in community institutions there is often real estate brokers saying we should go here and a market president says you definitely need one there. And those are inputs that matter, but having a baseline of data.

You should absolutely consider other factors beyond the data when making decisions, but at least if you have good data and good interpretation of what that data means as to key metrics like I mentioned earlier, where is the biggest fair share opportunity gap?

And in the type of business I do and I want to do, wealth, millennials, whatever it might be, those decisioning factors, letting data have a bigger seat at the table when deciding how to invest in your branch network, especially where to put branches and what type of branch format that should be. Is it a giant new flagship or is it just a smaller inline because that's more appropriate for this market? Those are two big mistakes that I'd love to see more addressed differently.

Jim Marous:

So on that mistake, do you help your clients actually do the data for them? Because again, they have the data but they certainly don't process it the way you want. And what we've seen at The Financial Brand Forum and elsewhere is a lot of the solution providers now can take care of the entire data part of it because they realize that most of the people they're trying to sell don't have that figured out, otherwise they'd do it themselves. So is that part of the services you provide?

Gina Bleedorn:

Yes. Well, yes, and it's funny you say that. Nobody needs more data. They have all the data. And in fact-

Jim Marous:

And oh, by the way, the data people don't want to do anything more than what they're doing now.

Gina Bleedorn:

Exactly. Exactly. And so when we set out to invent our analytics of practice at Adrenaline, I felt very strongly about making it immediately actionable. We found so many of our clients had data reports, consultant reports gathering dust on the shelves, literally. They didn't even know they had them. But actually all the answers were in there, they just weren't pulled out for them.

And so what we do is absolutely, yes, here's all the data, and by the way, if your data people want it, it is here, but 98 times out of a 100 they don't, they just want the answers. And so what we do very quickly because we understand branch, how to implement change, is get to those questions of wait a minute, what do I renovate, what do I close, where do I move, and how much do I spend, and in what priority order, in what market or in what place of the market in the form of a roadmap.

Short, medium, and long-term roadmaps, that's how we approach it and that's how I would encourage anyone to approach. From data, truly, find a partner that's getting out what you really need to know to answer questions about how you should spend your money in retail delivery.

Jim Marous:

And probably even the companies that have the data and are using the data, you can probably bring insights because they have their track record, you have the track record of all your clients that you can say we've seen a lot of people do that also, that really is a false positive or is a false negative.

Gina Bleedorn:

Yes. Yes. We find with some of the consultancies out there, they're wonderful at what they do, but there is a gap in understanding realistic deployment. And so they may give a perfect picture of, well, your network should look like this. And that's not possible in a 100 years perhaps because it takes a lot of change and the human factor and the technology, and yes, the things that we've seen that work and don't. So we bring that to bear and try to make data mean something.

Jim Marous:

So we're getting into 2023, we're all having to look at the economic outlook and say we're not really sure what's going to happen. So we have to prioritize. If you had to give one general recommendation for the marketplace, knowing that every institution's different, but if you said, man, if I can get one message out ... You had a panel today. You also did a presentation on these subjects. If you're trying to get that one message out, what is it to the marketplace as a whole?

Gina Bleedorn:

Embrace change, embrace it. I know it is scary, but in working with so many banks and credit unions, what I continue to be often surprised at but shouldn't be at this point, is the true lack of awareness of what the competitive landscape really is and really is doing.

And between the competition in the traditional markets with non-bank competition, with consumer expectation and just in general elevation of experience expectations, change is happening.

And if you don't get on the bandwagon of realizing that and making organizational moves to skate where the puck is going, you are going to be left. And so embracing change. What got you here and the way you've always done it maybe isn't the way you need to do it in the future to get where you want to go.

Jim Marous:

That's a great message because it really transcends more than just distribution. But if they don't embrace change, and then the other part of it, which you kept on referencing, and do something about it to understand ... I mean we know the mark. The bankers and the credit unions here at The Financial Brand Forum really have a really good idea what they need to do, but they need that push.

I mean it's like, I use it all the time, the analogy of the doctor that says you got to eat different, you got to work out differently. And you go through about maybe a month and it goes well and then you go back, you do it again the next year. But it's not until you get that warning sign that you actually take action. You can't wait till that long because what happens is the whole cycle could end up playing out.

And the learning of it, I mean, I know working with you and working with some of your clients, one of the biggest gaps is how much you learn in the process. Most organizations don't have the funding to say we're going to completely convert our whole branch network. It's going to come in stages. Those stages have to be cycled shorter, but the reality is it's the learning you do as you evolve to say oh, we might have missed this a little bit here, let's adjust on the next stage.

So I think that's important. And we can't underestimate, as you said from the very beginning, the power of the network, the power of the distribution in any format and how they have to work together. It's not a either or, this is [inaudible 00:41:55].

Gina Bleedorn:

Exactly. Exactly. And even McKinsey just published a study, and many of the consultancies published it's going digital, transform. And it is, but they've now said the future is physical and digital together.

Jim Marous:

It's interesting because people say they never need it until they do. And you may make it, you may be able to drive farther to get to the place you want to go. If you're not going to go total digital, you can't go dark in the meantime.

Gina Bleedorn:

Yeah.

Jim Marous:

Thank you so much for being on the show. I really appreciate it. And good to see you at The Financial Brand Forum again.

Gina Bleedorn:

You too. You too.

Jim Marous:

Thanks for listening to Banking Transformed the winner of three international awards for podcast excellence. If you enjoyed today's show, please be sure to give our show a five star rating on your favorite podcast app. Also, be sure to catch my recent articles on The Financial Brand and the research we're doing for the Digital Banking Report.

This has been a production of Evergreen Podcasts. A special thank you to our producer, Leah Haslage, audio engineer, Sean Rule-Hoffman and Dave Douglas, and our video producer, Will Pritts. I'm your host, Jim Marous.

Until next time, remember, it's not about physical or digital when it comes to bank distribution, it's physical and digital driven by data and analytics.