Deutsche Postbank is looking to revamp its network in an
effort to draw more people into its branches and increase sales. As
part of the initiative, the bank is trying out three different
methods to reduce waiting times; the best system will be adopted
and applied to all its branches. William Cain reports.
Deutsche Postbank, Germany’s largest commercial retail bank, is
trialling a new branch layout that could lead to a nationwide
revamp of the company’s banking outlets. The first of the branches
was unveiled at the end of October in Berlin, where Postbank has
its strongest foothold, with around 1 million customers.
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The bank has opened additional revamped branches in Augsburg,
Aachen, Garbsen, Constance and Regensburg. It also plans to open
two new finance centres in the greater Munich area and says phased
conversions will take place across the country from the beginning
of 2008.
A Postbank spokesman said the renewal of all branches could take
several years, but would not reveal the overall cost. However, he
said the bank was assuming the costs of the revamp will be covered
by improved sales. “We’re aiming for a modern design, more service
and better information for customers, streamlined processes, better
cross-selling, less queuing time, more positive shopping
experiences, higher satisfaction of customers and a better
atmosphere for counselling talks… We will measure success by sales
counts and we will ask customers and staff for their opinions on
the renewals,” he said.
Postbank has given priority to functionality over design to cope
with the demands of offering banking products alongside postal
services through its partner, Deutsche Post. It already offers
other retail services, including the sale of mobile phone
contracts. The bank has extended the range of products it offers by
signing a deal with Ticketcorner, one of Europe’s top ticketing
companies, meaning it will sell tickets to concerts, exhibitions
and sports events across the country. The idea is that these
services will bring people into branches, which Postbank believes
allows it to sell more products and gain more customers.
The Postbank spokesman added: “It is a question of keeping costs
down. If you manage to do more business in existing selling units
without enhancing the costs, this will add value. Of course, we
have linked up with Ticketcorner to increase revenues. But this is
only one point. The other is that tickets add a quality of shopping
experience to our branches that banking products do not provide – a
kind of emotion. In addition to this, the offering of non-banking
products increases the frequency of customers visiting the branch.
This enhances the opportunities to offer banking products as
well.”
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By GlobalDataThe strategy comes in the midst of difficult times for retail banks
in Germany. Competition in the sector is fierce and some of the
country’s banks have also been hit heavily by their exposure to
problems in the US subprime market, although the effects on
Postbank have so far been limited. The bank posted a profit of €806
million ($1.18 billion) in the third quarter, an increase of 24.6
percent compared to the same period last year. The retail side of
the business improved 4.4 percent year-on-year, to €684
million.
Postbank’s focus on improving profitability at its existing
locations is in part a recognition of the difficulties the bank
faces expanding organically. The German three-pillar system keeps
Postbank from acquiring German savings banks (Sparkassen),
which make up a substantial part of the market. That leaves it with
limited opportunities for further consolidation.
As well as profitability, consumer satisfaction is at the heart of
the redesign strategy. The bank is trying out three different
methods in different branches to try to reduce waiting times:
central waiting points, queuing systems and a decentralised waiting
system. The best system will be adopted and applied to the other
branches. In a statement, Postbank’s head of branch sales,
Hans-Peter Schmid, said: “Our aim is to have served 93 percent of
our customers within five minutes. The figure is currently 90
percent.”
The Postbank spokesman added: “The German market structures are
very favourable for customers. Germany is over-banked. There is a
high density of banks and branches, each competing with the others.
This intense competition squeezes prices and pushes up the quality
and quantity of services.”
Postbank said its new strategy was not aimed specifically at
improving market share outside the capital, but to raise standards
across its branch network. “The idea is not to spread branches
across Germany, but to make more and better business in the
branches still existing,” said the spokesman.
