Capital One Cafe Harvard: A Reimagined Strategy to Banking

Ever since Capital One, which started as an online bank in 1994, it has gone on to open more bank branches across the country. 

In this digital age where most traditional banks are closing due to more digital services, this comes as a shock. So what then led Capital One down this strange but rewarding path? 

In 2001, in partnership with Peet’s coffee, the first Capital One Cafe opened in New York. Since then, it has opened several other branches, including Capital One Cafe, Harvard. 

This strategic partnership was born to create a face-to-face connection, which most digital services lack. With each branch having its unique features in terms of architecture and space, Capital One aims to make its customers live while banking. 

The Cafe strategy may seem like a thought aimed at Gen-Z to grab their attention, but millennials and boomers love it so far. Why wait in line and stare at glass windows, bored and checking your watch every 5 minutes, when you could sit down, order coffee, and work during your wait.

About Capital One

Building on its mission to help its customers succeed through an authentic, simple, and humanized approach to banking, Capital one started operations in July 1994. 

Led by its founder and CEO, Richard Fairbank, Capital One, now headquartered in McLean, Virginia, currently has more than 900 branch locations located primarily in New York, New Jersey, Texas, Louisiana, Maryland, Virginia, and the District of Columbia.

Presently, Capital One is the United States’ fifth-largest consumer bank and eighth-largest in the United States. Capital One banks on the information and technology revolutionizing the banking sector.

They offer financial products and services to consumers, small businesses, and commercial clients through multiple channels. 

They do this while measuring customer satisfaction through their enjoyable experiences and how they advocate for them.

Something unique about Capital one is its approach to banking. Although providing financial services is at the root of their services, banking is not their primary focus, but everyday living while banking. After all, most people hate bank branches and are now open to exploring more remote banking options with the digital age.

Capital One Cafe Harvard: A Bank or Cafe or Both?

A quick look at the Capital One Cafe website displays everyday banking services like insurance, banking, credit, etc. 

However, they also provide additional services like breakfast, coffee, tea, and juice, not typically offered by your typical bank, but by a cafe. Capital One Cafe Harvard aims to provide customers with a reimagined banking experience that builds a connection with customers. 

With its WeWork-y space feel, marble tops, private workrooms, and new chairs, its first branch opened at Boylston Street in Boston as 2015 was nearing its end. At this time, banks were battling the difficulty of selling loans and credit services to their customers in their uptight office spaces.

The Capital One Cafe Harvard features free WIFI, electronic banking, and a chance to sip delicious coffee and bank in a more relaxed environment.

Capital One offers additional perks to attract locals to its branches to drive its motive forward. Such extras include free pizza on certain days of the week for college students and free financial coaching, in addition to its state-of-the-art architecture and private spaces.

Capital One Cafe currently has branches extending beyond Louisiana, Texas, and Minnesota.

What Led to the Strategy?

Capital One started as a 100% online bank – but some people feel uncomfortable only interfacing with their bank online. 

So when they come into a Capital One Café Harvard, they are guided through the process by a person – but they are still banking entirely online.

This need for connection forms the bedrock of the cafe strategy. As bank traffic reduces, bank branches need to evolve in servicing their customers. 

Although customers love performing transactions like transfers, depositing checks, etc., from the comfort of their homes, they want the banks’ reassurance of its availability when needed.

Is the Cafe Strategy Disrupting Traditional Banking?

Individuals initially thought that with Capital One Cafe’s opening, marketers would occupy its spaces, most of which are trying to sell a product or financial service. This practice is common with most banking halls. 

However, this isn’t the case because reviews indicate that customers are usually left alone, without coaches or ambassadors’ interference.

With banking, acquiring new customers from most marketing campaigns and sometimes reduced rates can be costly. Most banks outweigh the pros and cons of each strategy before pushing them out to the public.

A famous marketing quote once said that your customers are your best advertisers. By creating a friendly and welcoming space for existing and non-customers, Capital One Cafe has gradually gathered emotional loyalty from its clients. 

At a glance, its community and connection-building approach seem too costly. Still, traditional banking branches may need to rethink banking design practices when we weigh the upfront cost with the lifetime value it stands to reap from it.

Capital One Cafe Harvard vs. Banking Halls 

So, what makes Capital One Cafe unique from other banks providing financial services to customers?

Imagine walking into a traditional banking hall, with the security guards positioned at strategic locations, bulletproof window glasses blocking access to tellers, and its general tense atmosphere. 

This tense atmosphere makes connection building almost impossible with the glass and walls between tellers and customers. Hence, the Capital One Cafe strategy. 

Capital One Cafe aims to provide digital banking to its customers while also giving room for fostering relationships between bankers and their customers.

With the digital age, the processing of most transactions occurs remotely through the internet with our phones, tablets, laptops, etc. However, there is the ever-present human need for connection and interaction. Yes, individuals want things done quickly and efficiently, as most digital banks offer. Still, some situations call for a solution provided by human interactions.

Capital One Cafes aims to provide its customers a space to relax and recharge while banking. Their meetups and workspaces, with free Wi-Fi, give customers plenty of room to get comfortable and get some work done. 

Their full-service coffee bar also serves coffee, beverages, and snacks to their customers, with a 50% discount to its credit cardholders.

These features create a friendly and comfortable space that helps evoke an emotional connection with their customers.

Additionally, while traditional banks have tellers and marketers to market and attend to customers’ needs, Capital One Cafes have ambassadors to help their customers.

Capital One Cafe Is a Pretty ‘Sick’ Place: Here’s What Their Customers Have to Say.

It’s the little things that make a huge difference. For example, a Capital One customer, banking with them for over 25 years, recalled an ordinary day where he visited one of their Capital One Cafe to perform a banking transaction. 

The transaction went smoothly, with the bankers doing financial transactions and tellers performing their duty, all of which didn’t stick with him. What he did recall was warming his hands with a mug of hot coffee while he waited in line for his turn. 

This seemingly small thing made him feel like Capital One cared for him, not just as a paying customer but also as a human being. He has since gone on to refer new clients to Capital one.

Another customer says Capital One Cafe is impressive and fosters loyalty through its different but caring approach. Customers also love Capital One Cafe because they let their customers stay as long as they like, without disturbing or making them comfortable.

Not all reviews are positive, although reviews help with growth. For example, a customer once said the Capital One Cafe branch she entered did not instill confidence and trust as the bank intended. 

She described the setting as confusing, with the banking area not correctly labeled and customers having to do some exploring to know its true purpose.

Here’s How Capital One Cafe Harvard Can Help Small Businesses

On yet another brighter note, the Cafe approach adopted by Capital One can help grow communities in various ways. From acting as investment providers to using its space to organizing meetups and activities involving community members.

Due to the rise in digital services and the pandemic, bank branches are closing at an increasing rate. Over 4,000 banks have shut down operations in the United Kingdom alone in the past six years. 

Large banks like Wells Fargo, JP Morgan, and Citigroup closed more than 250 branches, accounting for one to five percent of their networks. This decline reduces customers who prefer traditional banking to the newer digital methods, access to financial services and offerings. Businesses that rely on it are left to provide an alternate solution to retain their customers; solutions like adopting mobile methods and collaborating with other service providers. 

The safe, warm spaces supplied by Capital One Cafe can provide an alternate way for small and medium businesses to these traditional banks.

Also, with Capital One acting as a sponsor to small and medium businesses and providing loans for local businesses like cafes, restaurants, and stores, it then acts as an investment provider. 

Capital One, in return, hosts these local businesses in their branch and provides repayment plans at interest rates they can afford.

They could also host their retail banking services in-store until the company is well-established. Then, these businesses move on to helping other small businesses, thus creating a constant investment cycle in the community. 

By creating such inclusive opportunities for small and medium businesses to grow and thrive, people development and income growth in the community occurs. In addition, Capital One can provide its different but somewhat familiar space to existing customers.

By launching initiatives that educate and improve awareness about entrepreneurship, money, and business growth, Capital One Cafe can also help young businesses. 

The Capital One Back Bay Cafe is an example of this, which teaches the locals about money management. In addition to serving the community and providing free meeting space for non-profits, Back Bay Cafe conducts community gatherings to increase awareness of tools, trends, and innovation with locals. 

Another example is the partnership with Junior Achievement and BUILD to educate the youth. The collaboration with Junior Achievement aims to teach local students about money management and BUILD to use entrepreneurship to motivate low-income students.

Another way Capital One can help drive innovation in communities is by partnering with brands to educate community members. In addition, the Capital One cafes also host monthly community talks, again providing further learning opportunities and investment in the local community.

With all these initiatives and events in place, Capital One can create job opportunities for individuals affected by the shift to digital ways of banking.

The Cafe strategy creates an opportunity to build on the skills of its workers. This partnership presents a massive career opportunity for workers in the Capital One Cafe like baristas, wait staff, and other cafe workers. 

With no knowledge of banking, technology, and finance, they can train under Capital One Cafe experts to develop skills to transition/grow to new careers. 

Thus, assisting such individuals in building new skills and opportunities for new jobs to handle the day-to-day aspects of the business and the work related to the retail bank within the company.

So Far. So Good: Capital One Cafe

The bank-cafe strategy seems to be working for Capital One Cafe as Capital One Cafes are opening in new cities. Boylston was the first location Capital One laid its first Cafe in Boston. 

At the opening of the branch, Jim Kelly, Head of Direct Banking for Capital One, described Boston as a digitally advanced, lively city with residents who love technology and innovation. These qualities made the town an excellent choice for Capital One expansion.

Their commitment to providing a unique banking experience has led to more physical locations, which is unusual as it began as an online bank. In addition, their environment provides an atmosphere where customers can come in, grab a coffee, have a money coaching session, or review their money relationship by asking questions. All of which happens while sipping great coffee.


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