“’Disney World has nothing on you’ is probably my favorite customer reaction so far.” Chad Hoffman, CEO and President of Richwood Bank says regarding customer reactions when they first enter the newly remodeled branch in Richwood, OH. The remodel is more than just an updated lobby redesign, it is a venture into the branch transformation and banking model of the future by upgrading a customer service model into the ultimate customer experience.
The Richwood Banking Company, newly branded as Richwood Bank, has six locations throughout Central Ohio. They’ve recently constructed a new operations/corporate facility and opened an 8th building – Richwood Marketing. Richwood Marketing is one of many initiatives developed by Richwood Bank to partner with local business and arm them with resources to thrive and stand out.
Richwood Bank identified in their strategic planning process the overarching goals of providing customers financial protection, social connection and life direction. The journey was set for increasing customer interaction and lobby traffic while most banking models are focused on mere transactions or automation.
While still in the early stages of their complete vision, the impact is already being recognized. Earlier this year, Richwood Bank received the 2015 Extraordinary Banker award. The process, which originates from the Emmerich Group, accepts nominations nationally based on differentiators developed in the community banking industry. An independent judge’s panel with members such as Steven Covey, review and determine finalists. Richwood Bank stood as the clear recipient this year for all of their efforts.
While receiving their award in Chicago, Hoffman stated, “This is a proud honor and surreal. The one thing I want to convey to the judges, fellow nominees and the industry we serve is that this is just the beginning. We aren’t yet where we want to be but proud of the progress we’ve made so far. This is validation that 2016 will be better yet.”
Of the three prongs within the Richwood Bank strategic plan, a new lobby destination redesign complements all of them. A conversation with both Chad Hoffman and President of K4 Architecture + Design, Jeff Klump, gives insight into the destination branch concept and how it paves the way for the banking/retail hybrid and successful branch transformation that can work for your community.
Questions for Chad Hoffman:
What was the basic impetus for starting this project? Here you are at Main and Main, the dominant/only bank in town, why go to such an undertaking?
- We had not remodeled the lobby since 1958 and wanted to drive lobby traffic. I do not have the opportunity to hire famous actors to promote our institution on TV. But I do have a lobby located in the center of town. We needed to find a way to leverage that and create an experience that the residents of the area would enjoy and visit repeatedly.
What feature(s) do your customers seem to like the most?
- The overall look of the lobby has been the biggest impact on anyone that walks in our doors. Whatever picture people may have in their heads when they come in is not what they actually experience when they walk through the door. It’s fun to watch both customers and non-customers walk in for the first time. Their expressions are priceless.
You have been in the space for a little bit of time now, what is one benefit you are getting you didn’t expect?
- To be honest, everything is working as we’d envisioned. The surprise is doing more than three times the business at the coffee shop than we had projected on the optimistic side. We are bringing in people of all ages and demographics. From 10 years old to 90 years old, the customers seems to enjoy the experience. Another positive outcome is the amount of bank business we are doing between 7 a.m. and 8:30 a.m. We started opening 90 minutes earlier to accommodate customers on their way to work and school, and it has been extremely successful.
How were the new teller pods received? Any push back from customers or employees? What about the cash recyclers?
- We had a few customers and team members that were nervous about the design being too drastic from 1958 to 2015. However, now that we are two months into the new space, I no longer hear these concerns. I feel all apprehensions were left at the grand opening door. The cash recyclers have been a huge hit. It’s a much more secure scenario. All cash is no longer in drawers and there are little to no trips to the vault. This also is a huge time saver in addition to the extra feeling of safety. There is certainly a learning curve to using the machines but I believe we will be a lot more efficient once we continue feeling more confident with the technology.
If you could change anything in the process, the materials, or the services, what would that be?
- The only thing I would have changed is the timeframe. It took us two years to take this project from idea to completion. That caused a lot of confusion in the community. Not everyone could understand what it was going to be and the conversations of perception evolved when progress was behind. Needless to say we had a handful of detractors. Once the project was finally complete and everyone could see the finished concepts we had envisioned, the detractions stopped. It’s the great space we planned for and with the success of the cafe, it’s hard to criticize the project.
Why did you choose K4 Architecture + Design as a partner to work with on this project?
- I met the individuals of K4 at the CBAO Convention and found out they designed not only banks but had designed retail space as well. Because of the uniqueness of our project, we wanted that kind of experience. We were very pleased with their design. They definitely listened to us and created something that would satisfy all of our needs.
Do you foresee rolling this concept out to your other branches? Could this concept become a prototype for future branches?
- This is a new concept and we want to watch the activity before committing to more locations. But our intention is to make this a new prototype for all branches. Obviously each branch will be handled differently because of the space, demographic or location but the experience we provide is vital to our relevance as a financial institution.
Questions for Jeff Klump
What were you initial thoughts when Richwood Bank approached you with this project?
- K4 was excited to work with a team that had an entrepreneurial spirit and forward thinking approach to branch transformation. It was exciting to be a part of the creation of a more retail-oriented branch facility, breaking the mold of the traditional branch model and combining the typical branch functions with other services to make it a destination and a place for social interaction.
What concepts did Richwood Bank implement that lend well to the future of branch transformation and configuration?
- The POD concept – Viewed as more personal, progressive, and retail oriented; gets away from the traditional model and makes room for a more “personal” interaction.
- The cash recyclers –increases efficiency, safety, and security of the POD concept.
- Mixed used branch – cafe, meeting space, social interaction, etc. In the digital age, many industries are trying new ways to get customers into their locations and increase their time spent there to foster relationship building and enhance customer service opportunities.
What elements of the Richwood Project do you think reinforce the branch as the #1 touch point in the customer experience?
- The Bank Branch is not just the place where customers come to open accounts, it is the place where the relationship begins and the first impression or touch point of the brand experience. It has become a place where people can interact with your brand. I think the café, modern design, and eye catching graphics that Richwood has implemented create the ultimate first impression for the customer, and the new environment and positive customer experience of the branch as a whole encourages repeat use. Your buildings are your physical space and are your presence within the community and Richwood made their branch a destination, where people still value personal interactions and relationships. I think Richwood has created something that not only compliments the community, but offers a place to bring the community together.
In combining factors such as spatial relationships between the offices and the transaction areas to allow cross selling opportunities, how did you see the cafe fitting into the flow of the branch?
- First, I thought the cafe would allow for more relationship building opportunities rather than a quick transaction would and I think solid customer relationships set the tone for cross-selling. The better the relationship, the more opportunity to sell and meet the needs of the customers. I also think the café and the meeting areas within the branch create a more casual and comfortable feel to the environment, which alleviates the sales pressure and allows conversations to take place, while adding to branch experience.
Have you seen a general trend in the industry of banking combining with retail successfully, and how is Richwood Bank at the forefront of this movement?
- Today, retail design is all about the customer experience and I think adding this element to the bank branch adds a new dynamic. We were intrigued with Richwood’s goal of making this branch a community destination while keeping a keen focus on their brand, history, significance, and prominence in the community. Although the Franklin Street location is the Main Office Branch, the strategy was to create separately defined areas but make the overall space a cohesive whole. The similarities in the design and the materials in the café counter and the POD’s, the proper placement of the graphics, and the combination of the finishes and the furniture make the space a focal point and attractive to their customer base of all ages. Not only was it important to Richwood Bank that they addressed the demographic make-up of their customer base, but the importance that their employees bought into the concept to make this successful transition.
How does adding the cafe foster the importance of promoting a sales culture and cross channel integration, blending personal touch with technology?
- I think it adds a side of customer service that nothing else can offer, and can turn a boring wait in a teller line into an opportunity to socialize, build relationships, and service and upsell your current customers. As transactions are continuing to decline, it is important to get people into your facilities in order to maintain an on-going relationship.
What do you think are critical dynamics of new markets considering this concept?
- The non-traditional bank branch can do well in different markets because it promotes and introduces new opportunities for cross-selling and interaction within the facility. For a smaller, rural community or one with older customers, this concept can work as it offers a new place for social interaction. Normally a smaller branch may have fewer customers so forming strong relationships and emphasizing the relationships with key customers is important. Changing the environment of the branch to increase time spent there and allowing for mixed used space can enhance the community feel and solidify the branch’s place within the community. For more urban areas – creating a café feel with free Wi-Fi and coffee is definitely appealing to the younger target market, but also the opportunity to rekindle the personal relationship of banking that people may feel is lost or being replaced by technology. There is an opportunity to engage customers and increase the value of your services. This concept naturally does well in areas with a lot of foot traffic. However, don’t make changes across the board to all branches without first examining markets individually and testing the concept first.
Read more about this project in the 4th quarter edition of The Ohio Community Banker.