Virginterritory – Paul Titterton, Virgin Money
If anyone knows anything about building a successful brand, it’s Sir Richard Branson.
Who remembers now that the trademark, pillar box red Virgin Money logos covered up the former Northern Rock fascias after the company bought the North East bank eight years ago, so forceful is its presence.
Now, the ultimate challenger brand, which itself was bought in 2018 by Clydesdale and Yorkshire Bank’s owners in a £1.7billion deal that leaves Branson with a 13 per cent stake, is planning to become the ultimate challenger bank on the high street. Following the banks’ integration, it is the Virgin Money marque that will drive development from now on. And that future is big, bold, and radically different to anything its nearest rivals – the Big Five – have to offer, by the look of its first flagship money stores.
Having disrupted everything from travel to telecoms, the record to the retailing industry, it’s no surprise that Manchester, Birmingham and London woke up in December to find that next-generation branch banking looks radically different when it’s undergone a Virgin Money transformation. All previously run under CYB’s B brand, the Manchester makeover includes a platform for concerts, a social media studio for vloggers and influencers, and after-hours co-working spaces with advice and mentoring for would-be entrepreneurs. However, it’s not just for Generation Z-ers.
“I think pretty much everyone’s trying to solve the same problem. We are seeing more and more customers use online banking, with basic transactions migrating away from the store and, therefore, what is the role of the branch?” says Paul Titterton, head of retail distribution at Virgin Money, which launched its first digital account and mobile app around the same time as it’s big High Street reveal.
The rest of the Virgin Money store roll out in 2020 will see all Virgin Money and CYB branches across the country brought under the same signature. The city centre flagships – some in new locations – will operate with hours to suit the locality, and offer facilities matched to their community – from early-morning yoga to late-night private business functions.
Titterton explains that one of the main challenges for banks in the digital era is striking a balance between innovating and maintaining a high standard of service with face-to-face contact for customers. He points to notable efforts by banks around the world to solve that conundrum.
“In Hong Kong, Standard Chartered has a very technology-based branch. At Umpqua Bank in the US, they’ve gone more down a very community-based model. I like some of the things Barclays, HSBC and Nordea Bank are doing around guidance and advice, focussed on a very targeted customer segment .
“Customers do a lot online, but at some point they need a bit of reassurance to give them the confidence to complete. Quite often that will be speaking to a human who they see as having expertise in that field. That’s what I see, more and more, as being the role of the branch.”
The Virgin brand, of course, has a major advantage over many banks: namely, its 43 years of global retail experience. Its groundbreaking Megastore brand, which remains mega in the Middle East, and its empire of disruptive cross-industry interests, all operating under its ‘changing business for good’ ethos, allows it to offer a unique mix when it comes to redesigning the branch experience.
For Virgin Money customers and non-customers (yes, they are also welcome into its revamped stores), there are comfortable spaces where they can stretch out with complimentary refreshments, socialise, read newspapers, use iPads and enjoy exclusive events.
This physical presence, Virgin Money says, will remain central to the company’s offering as it looks to disrupt the UK banking status quo across all segments.
“We’ve spent quite a lot of time researching what small business owners want from their high street bank, particularly in light of us launching a new branch format in Manchester that was very much targeted at SMEs,” says Titterton.
“They wanted a place where they could learn from and get access to people like them that have similar roles in the local community, and own similar types of businesses, and an ability to network and learn from industry experts. They wanted a place where small business owners could work from, because getting office space in big cities is an expensive business. And then, finally, they wanted somewhere they can go and do all their banking.
“It’s a combination of those three things that we’ve put together for our store format in Manchester, and it’s proving to be very successful with small business owners.” This kind of experiential retailing for finance is all about creating a USP and using a physical presence to drive digital usage.
“I think most of the things that you could ever possibly want to do with a bank, you’ll be able to do via your mobile banking app at some point in the near future; in fact, you can pretty much do most things today,” says Titterton. “But the caveat is that it’s quite difficult to deliver a very human service via your mobile banking app. There are some traits that are just absolutely human that people value, and they are empathy, understanding, creativity, passion; all those things that people can deliver face to face, I don’t think you’ll ever be able to replicate through a machine.”
Virgin Money stores are, then, where the bank’s digital propositions can be ‘brought to life’.
“We want a place where we can showcase that and create advocates for it through our people. That is what I’d say building conversations with our customers, that actually add value.”
Great brands have the ability to drive cultural change and redefine how we do business. No one thought the first Virgin Megastore, which was replicated across the world, would be as phenomenally successful as it was. The brand’s latest space-bound venture, Virgin Galactic, will likely transform the travel industry. And for Virgin Money’s now six million personal and small business customers, it’s just crossed another frontier.
“We’re a really purpose-led organisation and incredibly customer centric,” says Titterton. “We give our people licence to surprise and delight customers, and that extends all the way through the history of the Virgin brand. That’s quite difficult to replicate in other organisations. That’s what sets us apart from the competition.”