By Ray Birch
OKLAHOMA CITY, Okla.—One credit union here has added Amazon Hub Lockers at a number of its branches as a means of driving additional traffic and providing a community service.
The move, says $4.1-billion Tinker FCU, is a means to keep branch traffic high and drive brand awareness as more consumers turn to digital banking and shopping. The latter has led to a surge in what is often referred to as “porch piracy,” where items ordered online are stolen from the porches of the buyers once they are delivered.
Amazon Hub Lockers are secure, self-service kiosks that allow people to pick up their packages purchased from Amazon at a place and time that's convenient for them—including evenings and weekends. Consumers get a code off the website when they set up delivery, and then stop by and punch in the numbers to open the assigned locker.
New Way to Interact
“We are looking for just any new way to interact with members and non-members in the community,” explained Matt Downing, TFCU’s vice president of research and delivery. “The physical branch network is important to us and we know digital is important as well. But it's important to connect with our communities in new ways.”
Downing acknowledged more credit unions are turning to co-branding arrangements with other businesses at their locations, such as partnering with coffee shops—an arrangement Tinker is also working on. As CUToday.info has reported, credit unions are increasingly looking to partner with other businesses in their physical branches as a means of driving traffic and cutting costs.
“What we're really hoping for with the Amazon lockers is that when people visit our branches to pick up their Amazon package, we get an opportunity to chat with them about Tinker and our offerings. And if not, we will still be building brand awareness,” Downing said. “The lockers just give someone another reason to visit the credit union.”
Lockers at 7 Branches
Tinker had Amazon lockers in place at seven of its 32 offices at the end of August, with the very first package delivered to a Tinker branch on Sept. 3.
“On the first day we had 12 different packages delivered,” said Downing, who said Tinker had planned to wait until later in the quarter to assess initial results. “So far, the traffic from the move has been high. We’re pleased with the decision.”
The decision to add the lockers made to not only attract consumers to Tinker and give members another reason to stop by an office, but to also build awareness, explained Downing. He said that when people order off Amazon, they can choose to have their package delivered to a personal address, or they can select from the dropdown menu an Amazon locker.
Tinker FCU is helping members avoid concerns around home delivery during the holidays.
“There they will see our name and our locations as a choice,” explained Downing, who added that Amazon’s website chooses the Hub Locker location closest to the buyer’s address. “Even if they don’t choose an Amazon locker for delivery, they will see the Tinker name.”
How the Deal Works
Currently most of the Amazon locker locations in Oklahoma City are at locations owned by Tinker, Downing said. The credit union contacted Amazon about the potential installations. All of the lockers are located immediately outside Tinker offices, with one in a vestibule that’s open 24 hours. Each location has between 30-50 lockers.
Amazon assesses each application to house lockers and chooses a site based on its location and appearance. Downing said Amazon visited the credit union’s locations and determined which would work best.
He said Tinker’s costs involved in clearing space for the lockers at each office—including ensuring handicap access—in addition to the cost for extending electrical service.
“The Amazon team then came in and did the rest,” said Downing. “They were fast and efficient.”
Downing said Amazon will only pay a monthly lease fee for the space if the location is highly desirable.
“And then, the payment is very nominal,” he said.
More Branch Traffic
“We're waiting until we get a little bit more data, but just anecdotally, there are more people coming to our branches now. We can see that,” said Downing. “And this is happening with no fanfare on our part. We didn’t advertise this at all.”
Downing added that as the holidays arrive Tinker expects more traffic from the lockers, adding that getting the lockers in place before Thanksgiving was intentional, as many packages tend to get stolen off porches near the end of the year.
“There was a study that came out that said there's a 7% to 9% retail uptick for locations with these lockers,” said Downing. “But we don’t expect that great of a lift, maybe 4%—as it’s harder for a financial institution to upsell a checking account than it is for a convenience store to upsell a bag of potato chips.”