FleetBoston Financial plans to reconfigure its entire Massachusetts branch footprint in a $47 million project that will take place over an 18-month period.
In a move industry watchers say is an attempt to reconnect with customers irked by FleetBoston Financial’s recent move toward monolithism, Fleet is reconfiguring its entire Massachusetts branch footprint in a massive $47 million, 18-month project.
“We have been watching and studying the traffic patterns of our customers, both where they go as well as when they go, to the branch or ATM [to find out] what it is, the nature of the transaction or the nature of the service requirement,” said Robert B. Hedges Jr., managing director of the retail distribution group at Fleet.
“We know from all the work we’ve been doing that in Eastern Massachusetts in particular, we clearly have the need to put more branches [and] ATM coverage in the marketplace because we don’t have enough capacity to service our customers the way we’d like to,” he said.
A completion date of spring 2003 will include 28 new branches and 27 upgrades and renovations to existing branches.
“It is a lot of money to be dedicated to this type of project in one shot, but relative to Fleet’s size, the dollar amount is pretty small, probably representing about 0.25 percent of revenue over the 18-month time frame they plan,” said Kevin T. Timmons, senior analyst at CL King & Assoc. in New York.
“The timing issue is one that’s really driven by marketplace demand or customers’ need and a recognition that the way that we’re configured today needs to change and evolve so that it better matches with the service level we’re trying to deliver for our customers,” said Hedges.
During the last five years, Fleet has undergone major merger and acquisition activity, not the least of which was the recent Fleet/BankBoston merger and resulting divestiture of 285 branches that went to Sovereign Bank alone. As a result of the mergers and the ensuing customer-related confusion and technical problems that come with such a large undertaking, FleetBoston received a smattering of bad press on the subject, including a radio call-in program that dedicated an hour to customer complaints.
“I do think it is a fairly important symbolic move for the company, which has taken criticism about its level of customer service,” said Timmons. “A public move like this demonstrates the company’s commitment to its customer base, and to the geographic region,” he said.
‘Being Accessible’
Hedges said the reconfiguration reflects the bank taking a good look at how it wants to be viewed by customers.
“We want to be able to provide more ability to do investment business with our customers,” said Hedges. That means more space in branches for Quick & Reilly, the bank’s brokerage arm.
“We want to be able to do more in the small business front with our customers – both their service and credit needs – and a lot of the branches we have, quite frankly, don’t have enough room. They were designed for a different era when the service needs were simpler and what a customer would do when they came in was more basic,” he said.
Although sites for the 28 new branches have not yet been released, Fleet promises each will be 3,000 to 4,000 square feet. It expects to open 14 new branches in Eastern Massachusetts inside the Interstate 495 belt, three on the North Shore, six in Southeastern Massachusetts, two in the central part of the state and three in the western region. Additionally, the bank plans to add 16 new remote ATM units inside I-495, and seven in other areas of the state.
“Part of what we’re doing with this whole project is really updating our model for what we want one of our branches to look like,” said Hedges.
“The brand we’re trying to build, the image we’re trying to build, is very much one of being accessible, and easy to do business with and convenient, having expertise available,” he said.
Much of that has to do with the ease of entry and exit from the facility; therefore, parking lots will be reconfigured as well. Signage will be redesigned and merchandizing will be unified, he said.
“It puts a real premium on layout and workflow, particularly since we have a number of different types of customers that are in the branch, in some of our smaller locations – it just doesn’t work,” said Hedges.
Fleet is working with Interbrand, a New York-based firm, for design. Fleet will still use the green-and-blue color scheme, along with the eagle design, that has become familiar on Fleet’s newest logos.
The Massachusetts effort marks the first statewide rollout of the new branch design. “We’ve done smaller pieces of work like this … On Long Island, we’ve done about a dozen locations with the updated look and feel. Those were mostly all renovations,” he said.
“Conceptually, the new offices sound as if they could be a tangible benefit for both the company and consumers. In order for those benefits to be recognized, it will be important for the company to staff the offices with strong people dedicated to providing top-notch service and willing to be proactive sales agents,” said Timmons. “Done right, it should be received favorably by customers, although even a major success won’t have a material impact on overall corporate earnings.”
