A bank? A café? Capital One asks, How about both?

The Capital One 360 location in Chicago's Gold Coast neighborhood.

The Capital One 360 location in Chicago’s Gold Coast neighborhood.

by Dan Rafter

How often do you actually walk into your bank’s lobby these days? If you’re like most people? Rarely. Customers today do much of their banking online. When they need quick cash, they head to an ATM. Bank lobbies are becoming increasingly irrelevant to customers.

Mercator Advisory Group in a recent study found that the percentage of customers who reported visiting a bank branch to speak to a customer-service representative at least once in the previous year fell from 62 percent in 2011 to 45 percent in 2014. And earlier this year, the Washington Post reported on a recent speech from the former chief executive of Barclays who said that the global banking industry will cut employment and bank branches by 20 percent to 50 percent during the next decade.

It’s little surprise, then, that some banks are getting creative when it comes to revamping their physical storefront locations. In the Midwest, this is exemplified by Capital One, a bank that is increasingly focusing on digital banking itself. The bank 10 years ago opened its first Capital One 360 café in Chicago, a location in the city’s wealthy Gold Coast neighborhood. The café is exactly what it sounds like, a place for Chicago diners to get coffee, pastries and snacks in what really does look like a cafe. The space also comes with a few low-key financial services, such as a Capital One ATM and on-site banker.

The goal of the cafe was simple, said Antonio Wilson, Capital One’s Chicago Café Coach: It’s about building new relationships and retaining existing ones with Chicago customers.

“Our goal as a company is to reimagine banking in a different way. The café approach fits in with this,” Wilson said. “The goal is to get people to come in for coffee or pastries. This is not a place where they feel like they are instantly going to have a banker in their face talking about our products. So initially, people use the site as a full-fledged café. Over time, though, they might bring up the conversation with our on-site bankers about our products.”

The café has proven so successful in its Gold Coast location at 21 E. Chestnut St., Capital One is now opening two new Capital One 360 cafés in Chicago, one in the New City development at 1538 N. Halsted St. in the Lincoln Park neighborhood and a second at 3435 N. Southport Ave. in the Southport neighborhood. Both cafes will open in early 2017.

Capital One started the expansion of its café locations in Boston, and the bank now operates five in that city. Wilson said that Chicago was a logical choice in the Midwest for more café locations.

“Chicago is ready for it,” Wilson said. “Chicago is one of the up-and-coming digital tech hubs in the country.”

Mike Friedman, market lead at Capital One, said that the cafés are a result of changes in the way people bank. Studies back up Friedman when he says that a growing number of consumers prefers banking online. That’s why Capital One offers a range of apps and online services that allow its customers to create budgets, access their credit scores and, of course, deposit money and make payments online, often from their phones.

The Capital One 360 locations fit into this by providing customers with the opportunity to make a human connection with the bank if they want one. That human connection takes place in a low-key setting, Friedman said.

“We have all the tools that allow us to be a great online bank, but then we have our ambassadors in the café who can focus on human connections rather than sales quotas,” Friedman said. “It’s a lot more than just providing the community a coffee shop. It’s about allowing the café to provide those human connections.”

The Capital One 360 locations have worked out an arrangement with Peet’s Coffee & Tea, a national coffee chain. Peet’s provides the coffee and pastries and hires the workers to staff the cafe area. Capital One provides the locations, of course, and the financial representatives who are on site.

The question, though, is whether other banks, as they face their own branch closings, will take similar steps to entice customers to visit their remaining locations.

Wilson wouldn’t make a direct prediction. But he did say that Capital One’s model is working and might inspire others.

“If I had a crystal ball to predict something like that, that would be awesome,” Wilson said. “But we think it’s such a great model, I’d be surprised if others didn’t attempt something along the same lines.”

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