With 27 branches across Minnesota and one hefty addition on tap for this year, Affinity Plus Federal Credit Union ($1.6B, St. Paul, MN) is not afraid to share its passion and belief in the capabilities of the branch model.
“There’s a lot of discussion on whether branches are too expensive or too costly, but people like to be able to come and see us if they have a question or concern,” says David Larson, senior vice president at Affinity Plus.
“They know that we’ll actually be excited to see them and talk to them. We don’t push the cheapest channel because getting to know a member as a person is so critical to building a relationship.”
Getting More From Branch Interactions
Member advisors that staff the branches can assist with any product and service the credit union offers. This also allows branch managers to focus more on culture and branch-wide leadership rather than assisting with individual issues.
One successful branch sales strategy has been to print the multi-page fee disclosures and rates from a competing bank and display those alongside the streamlined options from Affinity Plus, either on desks or in other prominent locations.
“Through that one step, we’ve seen a lot more penetration in products and services with our members, along with some very strong ROA,” Larson says.
Individual branches are scored not just on performance data, but on member experience and culture, and this is measured by a series of surveys about things like the likelihood of referring a friend or family member to the institution.
Positioning For The Future
The credit union currently owns about 30% of its branch locations and leases the rest, especially in new markets.
The credit union recently added three new call center locations each with around 20 employees and is building a new 20,000 square-foot, two-story location in Roseville, MN due to open this fall. The ground floor of this location will house the branch activities, but as traffic increases, expansion to the second floor is a possibility.
The second floor could also potentially house a call center expansion, a community room, offices, or other features, depending on the demands of the organization. The drive-thru area at this location will also be stacked, meaning the credit union can assist two members in the same line at the same time.
“The magnitude of this branch, in terms of size, isn’t typically what we’re looking at with expansions, but we’re putting a lot of attention and focus on this opportunity,” Larson says. “Next year and beyond, we will indentify new markets and be active in branch expansion.”
One prime market for Affinity now and in the future is the neighborhoods surrounding a state college or university.
“On campus there’s a lot of competition,” Larson says. “However, there are also a lot of people who live or work off campus in the community, so around every campus location we serve there’s also at least one branch.”
In July, 67,000 members used an Affinity Plus branch, while 80,000 used the call center, and 68,000 used the virtual channel. In all, the credit union is growing by around 2,000 new members a month, and more than 83% of that activity comes through referrals.
“Our branch traffic is fairly consistent, with people joining mainly through that channel and then recognizing our remote options,” Larson says. “Members know we want to talk to them and won’t overtly push them toward online channels, our website, or a menu.”
The credit union has a demonstrated ability for picking fruitful locations, fueled by a large state-wide advertising campaign and anti-bank sentiments that prime potential communities even before the credit union has a presence there.
“Our CEO always says one of the positives about branch expansion in this market, and one of the negatives, is that you can pretty much put a branch anywhere and it’s going to have success,” Larson says.
Rethinking The Branch Experience
All new branches are designed to avoid what Larson calls the “continental divide,” where customers are wrangled into a teller area, loan officer area, or other line based on the purpose of their visit.
“We want it to be free flowing and fun,” he says. “As employees become available they’ll be able to help members with whatever their need is.”
The credit union is also keenly aware of how branch activity impacts people outside the institution.
“Branch expansion gives us visibility in the community, which in itself helps promote the brand,” Larson says. “But it also allows us to impact local communities and improve the look and feel of these locations. We’re hiring local employees, vendors, and partners for things like cleaning or snow removal, and that business is very well received in the community.”
ATMs today can also provide much more of an enhanced experience, including remote deposit capture abilities and customization of message, he says. In some locations, the credit union is considering relying on high-end ATMs to fill any gaps in the footprint that it can’t reach with brick-and-mortar.