Indie Banker

Julie V. Mayrant on in-store retail banking

By Judith Sears

Julie Mayrant and Woodforest National Bank’s branch network grew up together—professionally, at least.

Mayrant joined the $3.9 billion-asset community bank in The Woodlands, Texas, in 1996 as the bank’s first in-store branch manager, managing a location in a Wal-Mart Super Center. As a result of leading the bank’s retail initiative, she was promoted 18 years later to president of the bank’s retail division which oversees 732 in-store locations.

Woodforest National’s foray into in-store branches began nearly 20 years ago when Wal-Mart approached the bank about leasing space in a new retail center. The offer looked like an opportunity to fortify the bank’s branding presence in the community, so the bank decided to give it a try.

What started as an experiment, turned into a great rocketing success, and Woodforest National has continued to pursue in-store branching as a major part of its growth strategy. The bank’s success in this area, Mayrant believes, has been due to its willingness to learn from and incorporate some practices of its retail partners. “There’s retail banking and then there is the retail business,” she says. “Woodforest has tried to align ourselves with the true retail elements of Wal-Mart and Kroger.”

At the most basic level, this has meant listening carefully to customers, learning the details of their shopping and banking habits and preferences. “We started understanding how to operate in that environment and that made us more successful year over year,” Mayrant says.

Woodforest National soon adjusted its in-store branch hours to more closely match the retail locations that housed them. Today, most of the community bank’s in-store branches are open seven days a week. What’s more, in its home market in and around Houston’s metropolis, the bank has four locations that never close except for Christmas Day.

Other changes were made to “sync up” with the retail environment. For example, the community bank aligned its paydays with those of its retailer partners. It might seem like a small detail, but Mayrant believes that putting Woodforest National employees on the same cycle as their retail partners has had a subtle impact on their mindsets.

“Now every single employee in the company understands the dynamic with our retail partners,” she explains. “Paydays are important to everybody. In retail, if your payday is different from those you’re serving, there’s a disconnect.”

Besides operational changes, in-store branch employees have learned to make the most of the retail environment. They wear branded uniforms and get out from behind the counter to engage roving shoppers.

“Customers going through the cash registers will run into Woodforest simply because of where we’re located within the store,” Mayrant says. “Our folks engage customers as the traffic goes by, talking about our bank and giving out marketing literature.”

Branch managers are critical to branch success, whether it be an in-store or brick-and-mortar location, Mayrant believes. She attributes much of Woodforest National’s branch network success to the autonomy of its branch managers. “We ask them to be business owners, to treat that branch as their own. They’re the face of Woodforest in every community we serve.”

For example, local branches determine their hours of operation. “We ask branch managers to tell us what hours they should be open for their customers,” Mayrant says. “They need the autonomy to voice what they think should happen. This helps both large and small branch networks.”

Mayrant believes that the future of bank branches will be governed by two disparate customer preferences: 1) Consumers like having high-touch financial services available, and 2) they are also increasingly using mobile and Internet banking.

There’s no question that customers want the reassurance of personal contact when their finances are at stake. “Banking and finance are still relationship businesses,” Mayrant notes. “Most customers enjoy the fact that you can come in and talk to somebody about growing your small business. That can’t happen as effectively online.”

Nevertheless, in practice there’s a decline in the volume of teller transactions and a rise in mobile and Internet banking. And, here again, consumers expect banks to meet their needs for innovative and secure mobile and online banking.

Mayrant foresees a mix of solutions to accommodate these somewhat contrary consumer preferences. The first is for community banks to take a very strategic approach to branch locations. Woodforest National’s brick-and-mortar branches, for example, are placed in counties where the bank has a strong market share and presence. This allows the bank to provide a physical presence where concentrated numbers of customers live and work.

Given reduced teller transactions, however, another alternative may be to switch to smaller, more economically feasible brick-and-mortar branches. “Large physical structures will downsize,” Mayrant predicts. “Twenty-five teller windows just aren’t necessary.” Finally, Mayrant doesn’t rule out closing branches in the future as part of an overall strategy. “For the bank to maintain its strength, sometimes consolidation may have to happen. Tough decisions may be the right ones,” she concludes.

In the end, Mayrant thinks that the “people” element of either small or large branch networks create their success. It’s especially critical, she believes, for community banks to move away from silos of expertise—whether teller, lender or personal banker positions—limited to knowledge in one specific operational function. “We’ll see more of ‘everybody can do everything.’ Due to innovations in technology and consumer adoption, rote teller transactions will eventually not be as prevalent throughout the industry.”

Mayrant points instead to the concept of the “universal banker,” who can deal with a wide range of issues and products. This is crucial, she believes, since customers today can do so much research online. When they consult someone in person, they expect to get additional expertise. “If customers take the time to come in and visit, it’s important that our teams are prepared to answer questions,” she says.

To achieve such wide-ranging expertise will require significant training. Mayrant acknowledges the logistical challenge, but also believes it’s inevitable. The universal banker concept reinforces the importance of the autonomy of employees in building a bank’s success, which Woodforest National and Mayrant see as its way forward.

“We strive to empower people to make decisions in the best interest of the customer and the business,” she says. “Empower your team and have the right people running the branches.”

Judith Sears is a writer in Colorado.