Characteristics of Closed Branches - Trade Area Lifestyles

Last week, we began our analysis of closed bank branches, suggesting that the next steps are profiling the trade areas involved, in terms of demography and lifestyle, business mix, primary site characteristics and several other key metrics. 

Demography and lifestyle turns out to be quite telling.  Using ESRI Tapestry, we find that the top 5 of the 65 Tapestry segments account for over 42% of these trade areas. 

Laptops & Lattes are nearly 16 times as likely to be in one of these trade areas than in the U.S. as a whole; Metro Renters, nearly 12 times as likely.  Further, 4 of the 5 segments are in the Solo Acts lifemode or uber-category.  We also note that of 11 Urbanization areas, 45% are in just one, Principal Urban Centers I.

And, the plot thickens.

Average household size is quite small, at just 2.19 - reflecting all those Solo Acts.  And income is upscale, at a median AHI of nearly $60,000.  Though 58% of occupied units are renters, those who do own homes have home values well above the U.S. average.  The trade areas are also about 2/3 White.

Not exactly what one might have expected.  That is, until you consider that the people we are talking about - young upscale singles and couples and some very young families - don't rely on branches to do their banking.  So, while they are dynamite prospects for financial services - just the kind of people that American Express targets and courts early and often - branches may not necessarily be the way to make them customers.

That is, branches as we now know them.