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Customer experience:Lounging not slouching
The Virgin group has a reputation for doing things differently. The new Virgin Money Lounges continue that custom. Sarah Perrin reports.
Imagine a comfortable space, owned by your ISA or credit card provider, where you can relax on a sofa, enjoy a free coffee and check your emails while the kids play in their own dedicated area; where no one asks you when your house insurance is up for renewal or whether your stakeholder pension is adequate.
This is Virgin Money’s Lounge vision – a concept being brought to life in four UK locations: Edinburgh, Manchester, Norwich and London.
“We have always had an online and telephone direct presence,” says Virgin Money spokesman Scott Mowbray, “but the lounges are our first opportunity to offer our customers a physical presence.” He likens them to “a bridge” ahead of Virgin Money’s planned branch roll-out in its drive to bring some Virgin innovation to high street personal banking.
The lounges are designed to be “non-sales” environments. “In the first instance we are not going to be selling products or services,” Mowbray says. “Each lounge is purely for customers to grab a coffee and relax, check emails, charge mobile phones, possibly have a meeting – whatever they want. There will be no hard sell whatsoever. Of course, we will have iPads and wi-fi connection, so customers could access the Virgin Money website – or any website. But the lounge is really meant to be a nice space for customers to use ahead of the branch roll-out.” Customers will have access to TVs, newspapers, magazines and complimentary light refreshments.
However, all the lounges, apart from Edinburgh’s, could ultimately evolve into branches, offering usual banking functionality in addition to relaxation space. The Edinburgh lounge, based in the same building as Virgin Money’s new HQ at 28 St Andrew Square and expected to open in September, is the exception. “The Edinburgh lounge will remain a place for customers to relax or work,” Mowbray says.
Out of business hours all the lounges will be made available to community and charity groups. “Maybe a local artist might want to hold an exhibition,” Mowbray speculates. “The lounges can be used for that, too. We want to be involved in the communities where we are based.”
He credits the lounge idea to Jayne-Anne Gadhia, Virgin Money’s chief executive. “She’s been doing a lot of thinking – as have our whole management team – in terms of what we can do that is different to attract customers away from their current banking arrangements. It’s a well-known fact that customers are more likely to get divorced than they are to change their current account. Apathy rules. But off the back of the financial crisis, we believe we are a brand and a business that can restore some trust, deliver something different and attract people. The lounges are part of that first step.
“A lot of people are a little disenchanted with their usual bank. New branches can look great and futuristic, but most are very clinical. They are about getting in and out quickly, transacting and leaving.” By contrast, Virgin Money wants to get back to a more “traditional branch model” where customers don’t automatically need or want to rush away, where they may even know their banking manager. “That’s what we are aiming for – a traditional model with customer experience and service at the heart of it, but delivered through any channel or access point our customers choose – online, by phone or face to face in the branch,” Mowbray says. “Although [with the lounges] we are looking at a model that will provide a place for customers to linger if they want to, it’s important not to forget that some customers do just want to get in and out quickly. We think we can deliver the mix.”
Are the costs associated with the lounges justifiable? “We believe the costs attached to our lounges, and in investing in the customer experience, will pay dividends back into the business in terms of loyalty and customers wanting to be part of our club. Potentially they will take out another product, for example. If you can deliver customer service and satisfaction, then the profit will follow from that.”
The lounge sites will also provide some powerful brand reinforcement opportunities. “Virgin Money has been around for around 16 years, so quite a short time for a financial institution,” Mowbray says. “Through the lounge concept, we will be able to illustrate a lot of the Virgin heritage.” Artwork or photographs displayed on the walls will remind customers of the links with the Virgin Group and Richard Branson’s achievements in, for example, shaking up the airline industry.
Virgin Atlantic wanted to “provide something different” Mowbray explains “and that’s what any Virgin company does. We are no different. We wanted to get our banking licence, which we achieved in January 2010, in order to take on the banking establishment, provide something different and start serving under-served customers.”
Bringing the concept to life
Virgin Money engaged strategic design consultancy allen international to help it create the desired lounge environment. “This was a unique opportunity to design a space on the high street which is about giving something back to Virgin Money customers,” says design director Richard Benson. “We felt it was important to design a space that created a sense of occasion.”
Classical details and touches were therefore used, such as bespoke wallpaper and rug designs, all with an ornate monogram pattern based on the Virgin Money initials to create a witty take on more “regal period” design.
“It was important to create a timeless quality to the interior,” Benson adds. “Elements such as the furniture have been carefully selected for their contemporary twist on classic pieces. For example, armchairs that are a modern take on the traditional wingback chair covered in contemporary and colourful fabrics, bespoke seating booths combining deep buttoned upholstery with simple contemporary lighting features – all combining to create a purposely eclectic feel which we hope will make the customer feel relaxed and at home.”
The lounges’ potential use for community events has also been accommodated through “simple details” such as individual cafe tables designed to specially interlock to create larger meeting tables. Pianos have been incorporated for performances, and furniture in the lounges can be easily moved to create open spaces.
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