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According to Professor Martin Clarke of GMAP, there are two key elements to making branches more effective: get branches in the right location and match product mix to local population
Banks and other financial organisations want to grow their ability to generate new, profitable revenues. So it's no surprise that they should recognise that branches serve as more than transaction centres - they are their most significant sales points.
Financial organisations that effectively manage the types of products and services that are available within their branches, and are able to vary this across the country according to demand, will be the ones that can improve efficiency, customer loyalty and therefore revenues.
Detailed location and information analysis
But selecting the most profitable product mix by branch location means having access to detailed location information and analysis.
Such analysis can throw up surprising results. One is that banks might be more profitable deepening their footprint rather than expanding it. The presence of several branches in an area where a customer lives, shops and works is mutually reinforcing and improves the perceived value of the bank.
This remains true even if the local community doesn't use that branch, but other channels like ATMs or the internet. Furthermore, irrespective of local geo-demographics, it is the customers in areas where there is a...