Improvements in technology breed change. For example, the rise of online and mobile banking channels has forced credit unions to reconsider the role of the branch.
Of course, technology — more specifically, digital channels — have impacted industries beyond financial services. Consider Lego.
The company best known for producing colorful, interlocking, plastic bricks hasn't struggled to hold the attention of its youthful market despite the availability of sophisticated, life-like video games. In fact, as the chart below illustrates, Lego has increased revenue and profits and has even hired an additional 4,000 employees since 2009, according to an article in Fast Company.
Image courtesy of Fast Company
The Fast Company article details the successful programs and initiatives the Danish company has put into place to achieve this growth. Of note for credit unions is an ongoing forward-thinking, high-level experiment called One Reality, which operates on an important insight gleaned from study data.
“[Lego] research has shown that kids no longer make meaningful distinctions between digital play ... and physical play,” Jonathan Ringen writes for Fast Company.
One Reality combines playing with a set of Lego bricks with software running on a phone, tablet, or computer, creating a joint digital-physical experience.
In the summer of 2013, the company introduced Lego Fusion. The play experience is as follows: players build a model of a house or castle with Lego bricks, take a photo of the model with a tablet, and watch as their creation becomes part of a virtual world inside an accompanying app. Lego released four versions with different themes. One of the versions made the Toys “R” Us 2013 15 hottest Christmas toys list.
Still, Lego is in the beginning stages of understanding what this product can be.
In one version of Fusion, players build a flattened outline that becomes 3-D once it appears in the app, rather than allowing users to build a 3-D model from the start. And Lego shuttered another version once tests showed its bricks were of little importance to the overall experience.
The company will continue to experiment with technologies — it’s due to release Portal Racers, a digital hovercraft game that works with Intel’s RealSense 3-D laptop camera, in February — and study how kids and other consumers use its products.
Lessons For Credit Unions
More so lately, but the past year has been dedicated to stories showcasing so-called “branches of the future.”
I’ll let you debate among yourselves whether a branch of any kind is viable in a world where foot traffic is declining — take it up with Brett King on Linkedin — but the technology investments that many credit unions are making set up these locations to be, at the very least, complementary to mobile banking.
This is why what Lego is trying feels so relevant and translatable. Adults and credit unions clearly know the difference between digital and physical — unlike the kids who play with Legos — and each option provides a different value to a member. Branches offer consultative services and answers to complex questions; digital offers access to just about anything else.
But can these exist in concert? Can we use our physical spaces to add value to the digital, and vice versa? Part of the answer lies in better understanding all the banking channels — a topic we’re writing about in detail in February. Another part lies in reality. The way members use the branch has evolved; it’s time for the way credit unions use their branches to evolve as well.