The news: Branches will play an "ever stronger role" in customer acquisition over the next five to 10 years, Adrenaline Chief Experience Officer Juliet D'Ambrosio told EMARKETER in an interview. Her comments follow a new Curinos and Adrenaline report showing that US banks—led by JPMorgan Chase, Bank of America, and Wells Fargo—opened more than 1,000 new branches in each of the last three years, reversing a decade of consolidation. D'Ambrosio said those long-term investments mean today's branch expansion strategies are likely to influence customer acquisition for years.

Why this matters: The report demonstrates that national banks are expanding because branches remain powerful customer acquisition tools. D'Ambrosio argues that the strategy is being reinforced by changing consumer preferences.

• Roughly 84% of younger financial decision-makers prefer to open accounts in person, per D'Ambrosio. And branch proximity is a top-three factor in influencing where Gen Zers bank, per our survey data.
• D'Ambrosio described in-branch accounts as stickier over time. The report backs that up: Accounts opened in-branch carry higher balances and are 25% more likely to remain open after a year.
• National banks are expected to gain 8% or more in incremental branch share in select markets, translating into roughly a 10% shift in deposit share over time, per the report.
• In Boston; Washington, D.C.; and Philadelphia, Chase built branch share from near zero to 4% to 5%, with deposit share lagging before climbing steadily, per the report.

Zooming out: Regional players—bigger than community banks but smaller than the national giants—have the most ground to make up after years of contraction, per D'Ambrosio. They can't match national banks' scale or budgets and lack the local trust community banks have built over decades.

But changing consumer preferences may give them a path to compete. D'Ambrosio said 74% of Gen Zers report high financial anxiety, a byproduct of coming of age during the 2008 recession and the pandemic, fueling demand for the advisory relationships regional and community banks can offer.

Implications for banks: Branches pay off on a multiyear horizon, and banks that treat them as a quick fix misjudge their value. New branches typically underperform market benchmarks for 24 to 36 months, and D'Ambrosio said it takes 18 to 24 months of sustained marketing before a branch becomes an acquisition magnet. Regional and community banks without national budgets have accomplished this via grassroots tactics like micro-influencer campaigns, D'Ambrosio said.

In addition, D'Ambrosio said branches without a defined role within the network or mismatched to their market's size or needs struggle the longest. Banks should also resist overcutting staff, as relationships remain the ultimate source of branch value, D'Ambrosio said. And AI tools that help junior staff handle wealth management or lending questions should support bankers rather than replace them. While leading national banks have made meaningful progress, many community and regional institutions are still working to seamlessly connect digital interactions with in-branch staff, she added, making it a gap worth watching. 

This content is part of EMARKETER’s subscription Briefings, where we pair daily updates with data and analysis from forecasts and research reports. Our Briefings prepare you to start your day informed, to provide critical insights in an important meeting, and to understand the context of what’s happening in your industry. Non-clients can click here to get a demo of our full platform and coverage.