It’s Time for a Shift: From Transactional to Relational

by Tim Klatt, Director of Retail Strategies


For the most part, until recently the banking industry has leaned traditional, championing the expectation that transactions drive the business, and thus drive the branch. But as more financial institutions understand that change is essential for survival, they join the growing ideology that while transactions are important, they will never be the primary driver for one reason: Relationships are not built through transactions.

Yes, you can complete just about any transaction via mobile banking that you can in a branch. But we don’t see that as a threat - we see it as an opportunity.

The ability to complete transactions online doesn't depreciate the value of the branch, rather, it redefines its focus and purpose.

Financial institutions that are getting it right understand that branches have taken on a whole different personality, and are shifting focus to prioritize the creation of consultative spaces, designed specifically for their customer base to engage in in-branch collaboration that can’t be replicated online.

Ready for a change, but don’t know where to start? Here are three guiding principles to consider.

1. Understand Your Audience

Whether you are entering new markets or overhauling existing branches, the industry has changed, and so have your customers. Before you can shift a culture to truly fit those you serve, you have to thoroughly understand who they are, and the community they are a part of.

A tailored Strategic Market Analysis can help you identify your best growth opportunities by evaluating the risk and potential return of each opportunity in current and future markets using the latest market information and your own performance data. By analyzing the conditions and consumer profiles in each of your target markets, gathering unique perceptions of your audience and evaluating them in the context of your business performance, you’re able to weigh the risks and potential return of a variety of moves to ensure the best ROI long before pens hit paper or shovels hit dirt on your project.

For example, when C&F Bank started the transformation journey for its branch network of over 30 locations, they understood that as bankers, one of their biggest objectives was to support their customers and communities at large. They recognized that they couldn’t effectively do that based on assumptions or long-held beliefs steeped in the way things have always been done before.

La Macchia Group helped them develop a prototype design and kit of parts to bring consistency to the aesthetic and a plan to get started that could balance high impact with smart investments, tailored for each market segment. The first step was a market analysis that allowed C&F Bank to truly understand not only what drives their customers now, but what will matter to them down the road.

The way that La Macchia Group approaches these crucial market analyses is to achieve a deep understanding of both the operating model and customer base, and mesh them together in a way that empowers employees, serves customers and creates efficiencies for everyone involved.

A lot of our clients also find that one in three of their customers is over the age of 65. While that’s not really who they are trying to serve, there are certain motivational factors and unique psychographic elements that are connecting that organization with their customer base. Market analysis identifies those elements, empowering you to go out into a market with the goal of finding a younger version of your findings – same motivational structure, same reason for choosing the things they do – by leveraging your accessible data sources. Ultimately, this helps you find the right fit for development; a good area or population base that will connect with you on the same emotional level that your existing customer base does. 

As C&F Bank Executive Vice President and Director of Retail Banking Matthew Steilberg defines it, “A key to our long-term growth and independence rests on two things. Staying true to our current customers to give them exactly what they want/need, and attracting customers in new markets. We have to present a location, people, behaviors and products that all speak to a customer base that’s been loyal to us for many years, while still helping us transform into a bank for future, different generations.”

2. Shift Your Resources

A market analysis isn’t a formality that collects dust upon completion, rather it is a living/breathing tool that guides everything that comes next.

“The master planning project is a guidebook for me, and something I pull out at strategic planning meetings,” notes Steilberg. “It’s a way for me to look at a forest-level view of all of my locations and be able to figure out where we get the best return on scarce resources.”

The first application comes in connecting the findings with an experience your organization can facilitate in person that can’t be replicated in an online environment. At that intersection, you’ll find ways to meet the transactional needs of consumers in low friction, efficient ways and discover where to invest your time, talent and resources to grow the relational banking aspects that make the branch experience irreplaceable. To do that, culture, location and business strategy must all be well integrated.

For C&F Bank’s second project in a series of updates, the bank focused on downtown Richmond, building out a high-traffic financial center to serve as a hub for operations, mortgage and commercial lending, and their wealth management group. This high-traffic, downtown location also provided high visibility to a younger demographic that is not only tech-savvy but looking for a preferred financial institution to serve all of their needs today and well into the future.

3. Branding: Walk the Talk

A brand is not what you say, it’s what you do. It requires you to constantly evaluate where you are, in relation to where you want to be. How do you make changes, how do you do the right thing? How do you integrate tech in a way that supports employees and isn’t overwhelming to customers, while meeting needs and creating efficiencies?

C&F Bank worked with La Macchia Group to bring their customers into an interactive, engaging in-branch experience that communicates the C&F brand in a way that’s both comfortable for customers, but also a lot more engaging. This was accomplished by infusing the right messages at the right time, with the right intentions.

“It’s not just about having more screens,” Steilberg shares. “It’s about understanding the content that needs to be around customers. You have to connect with the motivations and insights of the market right around you.”

To align the C&F Bank brand with the unique needs of its diverse customers, La Macchia Group’s designers and its Vivalociti team worked together to provide custom brand integration, equipment and furniture, technology, and custom content solutions. All of these elements within one banking facility bring together the transactional and relational - taking each customer on a unique, personalized journey.

The end result is a modern, yet familiar-feeling operations center that gives C&F Bank the presence needed to sustain its bright future, attracting new talent and clients to fuel growth. As its assets continue to grow, remaining a powerhouse in its region will be an objective that this bank will continue to serve.

Bank transformation in Richmond, Virginia


Looking for more? See how the whole C&F Bank project turned out here.


Ready to take your next step? Let's connect on what a culture change could like like for your organization. 


Tim Klatt | Director of Retail Strategies

Tim Klatt | La Macchia Group

With a background in Geography and Geographic Information Systems (GIS), Tim began his career 15 years ago with MapInfo Corp, consulting for Home Depot as well as national restaurant chains such as Burger King, KFC, Taco Bell, and Pollo Tropical. As Director of Retail Strategies & Head of Vivalociti at La Macchia Group, he brings an increased understanding of how successful national retailers view markets. Tim believes in the power of data supported by in-market intelligence to predict viability of new branch locations. Since joining La Macchia Group, Tim has become an expert in the industry, participating in industry colloquiums, focus groups, and round tables.