Retail Strategy Fundamentals for Financial Institutions

Retail Banking Strategy at a Glance:

• As a part of retail strategy, banks must navigate how to operate more efficiently and deepen personal connections at the same time
• Cross-departmental collaboration ensures strategy is as all-inclusive as it is achievable
• Using a four factor model that outlines grow, fix, harvest, and rationalize ensures recommendations are grounded in reality

With rising consumer expectations and increasing competition from challengers, today’s banks and credit unions have to deliver greater value, faster transactions, and better experiences than ever before. That means navigating two core priorities: operating more efficiently while also deepening personal connections. “Most banks globally have been cutting down their physical footprint,” according to McKinsey’s State of Retail Banking. “But many are doing so without a clear strategy for balancing the cost savings and the revenue impact [of closures].” This is especially important given that branches drive the majority of account openings and balances.

Even today, the branch remains the linchpin of banking activity, so having a solid strategy for the retail channel is a must. That strategy should stem from a comprehensive framework that guides decisions about delivering cost efficiency and high-value, human centered experiences. Ben Hopper, Managing Director of Retail Strategy at Adrenaline says this “full transformation playbook” uses deep market analysis, detailed customer data, experience design, and financial forecasting. “What we’re creating in retail strategy is something leaders can use immediately, whether they’re onboarding a teller or making a boardroom presentation.”

Right Stakeholders, Right Data

Successful retail strategy starts with the right inputs from across the organization. While the head of retail typically leads the effort, cross-departmental collaboration is essential. “Retail touches everyone, from human resources and technology to marketing and finance,” as Ben explains. “But while we want to foster dialogue to generate meaningful perspectives, it’s up to us to identify which stakeholders have only a voice and which ones also have a vote.” Core decision-makers often include retail and finance, while HR and IT ensure the strategy is feasible, an approach that ensures all relevant viewpoints are reflected in the final plan.

A strong strategy relies on strong data. Adrenaline’s approach to retail planning for financial institutions combines performance data that clients provide and proprietary banking data from the Optimizer platform, available through the company’s strategic partnership with Curinos. The insights are plotted into a four-factor model that measures market potential, competitive intensity, branch performance, and network positioning. “This foundational anchor point allows us to see what’s working and what’s not,” according to Ben. “A market only has so much money in it. Using this model helps to know where and what to prioritize.”

To support smarter decision-making at the branch level, data is plotted along a performance-potential framework to categorize each location based on its current productivity and future opportunity. “Maximizing branch effectiveness and efficiency is less about design per se than customer experience,” according to “Strategic Retail Planning – Five Takeaways” from a recent Curinos-Adrenaline webinar. And the most effective branches have moved from transactions to engagement. “The performance of the branch will tell us how it’s doing today – it’s profitability, efficiency, and deposit and loan growth,” according to Ben. “While potential tells us what’s possible in the market.”

Purposeful Planning, Smart Strategy

Once the data is gathered and aligned with organizational priorities, it’s time to translate insight into action. Using a four factor model ensures recommendations aren’t just data-informed, but grounded in reality. By plotting variables, branches are grouped four strategic quadrants. Grow is high performance, high potential. Fix is low performance, high potential. Harvest is high performance, low potential. And Rationalize is low performance, low potential. “You wouldn’t invest in a low-performing branch with limited upside,” as Ben notes. “But if the market potential is high, we might recommend relocation, redesign, or a new format entirely.”

Decisions follow strategy, not the other way around. A low-performing branch in a high-potential area might need a new location or rightsized format. Conversely, a high-performing branch in a saturated market needs differentiation, so institutions may focus on marketing support or functional upgrades. For branches between quadrants, additional filters like Selective Investment or Defend guide more nuanced decisions. “It’s not about jumping straight to design,” Ben says. “It’s about agreeing on the why before deciding the how.” Ultimately, the four factor model gives institutions a data-backed way to understand their options.

Retail strategy offers more than answers – it creates alignment across departments, builds consensus among stakeholders, and empowers action, now and in the future. The end result is a five-year roadmap, built for implementation. The plan outlines market prioritization, branch-level recommendations, and phased actions that can be acted on with confidence. Just as important as the plan itself is how it’s created. A collaborative, coauthored approach ensures the strategy isn’t simply handed over to decision-makers, but reflects the institution’s own culture and goals. “Our clients take these pages into board meetings,” Hopper says. “Not because they’re our work, but because they reflect the institution’s own vision and priorities.”

To learn more about retail strategies for financial institutions, or to speak with one of Adrenaline’s experts, contact us today.

Adrenaline is an end-to-end brand experience company serving the financial industry. We move brands and businesses ahead by delivering on every aspect of their experience across digital and physical channels, from strategy through implementation. Our multi-disciplinary team works with leadership to advise on purpose, position, culture, and retail growth strategies. We create brands people love and engage audiences from employees to customers with story-led design and insights-driven marketing; and we design and build transformative brand experiences across branch networks, leading the construction and implementation of physical spaces that drive business advantage and make the brand experience real.