Four Fresh Trends That Will Flip Bank Marketing in 2025
Economic and demographic crosscurrents will force marketers to try fresh approaches to longstanding challenges in the coming year. The Fed's return to rate cutting is just one factor; another is the growing emphasis on family banking services. And everyone wants more flexible options for handling their finances.
By Steve Cocheo, Senior Executive Editor at The Financial Brand
New research from Comperemedia, a Mintel company, argues that some longstanding key assumptions among marketers will have to be reassessed in the face of new facts and changing attitudes. As a result, marketing for consumer banking products will demand fresh ideas — in some cases, the opposite of conventional thinking.
Four trends identified by the firm are:
- Marketing to the next banking cohort will hinge on marketing to an older generation.
- Legacy brands and challenger brands will swap their preferred market channels.
- The Federal Reserve’s return to rate cutting will change consumers’ mindset on debt.
- Consumers’ increasing preference for financial flexibility will impact the design of banking products.
1. Gen Alpha and the Rise of ‘Family Banking’
Not all that long ago, traditional bankers often scoffed about millennials. "I’m not worried about them," the cliché went. "They haven’t got any money."
Surprisingly, says Lierin Melvin, director of insights at Comperemedia, she still hears that from some bankers, testimony to how viewpoints on generations can get stuck even as that generation grows older and evolves.
Melvin has news for them: Not only do millennials have enough money to lure bankers, they have something else that should interest them: Their children.
Those children are Generation Alpha, which the company defines as people born between 2010 and 2025. This cohort will be college-bound in only a few years. The time to get them into a bank or credit union’s fold is now. But how?.
"Something that many brands are mistaken about with Gen Alpha is that they have to look specifically at 14-year-olds," says Melvin. "It’s important to understand the needs of 14-year-olds, but what’s more important is to see Gen Alpha through the lens of their parents, the millennials."
Melvin says a boom is developing in family banking products and services among both traditional bank brands and challenger brands such as neobanks and fintechs.
"I’m calling this the Golden Age of Family Banking. Developing brand equity through family banking endeavors is going to pay dividends moving forward."
— Lierin Melvin, Comperemedia
A growing group of providers is marketing services to help parents teach Gen Alpha kids about money management, while giving them some autonomy to spend by accessing funds through debit cards. Melvin says research shows that millennials are much more likely to teach their kids about banking and investing and to talk about the family’s finances than their own parents were with them. As a generation, many millennials are also aggressively saving money on their Gen Alpha children’s behalf.
All this adds up to a very different generation for financial services, according to Melvin: A cohort of people who will be financially literate — and sitting on nest eggs — at an early age.
Melvin says credit unions are ahead of banks when it comes to family banking and thinks this will continue as fintechs begin to provide credit unions with white label family banking packages. Some major banking institutions however have been digging into family banking. Among these are JPMorgan Chase with Chase First Banking, Wells Fargo’s Way2Save, Bank of America’s SafeBalance Banking for Family Banking, U.S. Bank’s partnership with Greenlight, and Capital One’s Money Teen Checking Account, a joint account that is actually open to children as young as 8. In early October, Bangor Savings Bank launched "pling," a family banking app and teen debit card.
Still, Melvin says that legacy banks don’t generally advertise directly to Gen Alpha, while some fintech brands such as PayPal’s Venmo and Block’s Cash App reach out to the kids directly through digital platforms such as TikTok. Comperemedia’s research found that Cash App, for example, leans into younger teens desire to express themselves and exhibit autonomy. A Cash App Instagram promo in Melvin’s report invites teens to design the look of their debit card.
Traditional brands’ preference not to go direct to the kids may be sound reasoning. A deeper dive by Mintel, "Family Finance — U.S. — 2024," by Patrick Rahlfs, principal analyst, warns:
"Most parents, particularly mothers, prefer that financial brands do not message their children directly through digital platforms, illustrating a clear brand-to-parent-to-child messaging trajectory that must be followed to resonate with parents without overstepping."
Read more: How to Define the Generations: The Ultimate Guide for Marketers
2. Banks and Challengers Swap Digital Advertising Strategies
In another trend highlighted by Melvin, traditional financial brands and fintechs have been pushing into the marketing channels once favored by each other.
Comperemedia tracks spending by financial brands in various channels and has found growing emphasis on traditional channels such as national TV and direct mail in marketing budgets of some challenger brands like SoFi. She sees this as a bid to build more mainstream brand recognition, in part to attract more business from older consumers who have tended to favor traditional providers.
While many fintech and challenger brands have stressed paid social media advertising in reaching younger audiences, Melvin says that their tightening marketing budgets, with the greater emphasis on traditional channels, will necessitate more use of organic social media posts instead.
On the other hand, traditional institutions have been trying to increase their trust and recognition among younger consumers, according to Melvin. As a result, they have been pushing further into paid social, and on platforms banking brands haven’t made much use of in the past. She adds that these brands have larger marketing budgets and thus have flexibility to spend on paid social campaigns.
Read more: Digital is Draining Banks’ Emotional Connections with Customers. GenAI May Make Things Worse
3. As Fed Cuts Rates, Consumer Views on Debt Will Evolve
Credit card borrowing continues at record levels. As the Fed pushes forward with its strategy to reduce rates, some consumers will be inclined to turn to credit cards to spend more, in cases where the price of credit is falling. However, Melvin’s report predicts that other consumers’ increasing caution about incurring more debt will draw more efforts by providers to play to these consumers’ budget-mindedness. Many are already overextended or simply don’t want to get in any deeper.
Melvin predicts that some financial institutions will try to promote alternatives to credit cards, including debit cards that pay cashback rewards and variations on the buy now, pay later theme.
Melvin sees this as a financial wellness play. "Financial institutions can provide services where consumers can capitalize on lower borrowing costs to pay off debt and avoid growing credit debt in the meantime," she says. She predicts more marketing that promotes cashback debit as a payment method with the convenience of a credit card but with the responsibility of only spending funds that you have. More players will introduce cashback debit cards.
"There will be an increase in marketing for this product line as the target audience broadens beyond thin-credit or credit-weary consumers," Melvin predicts.
Helping to drive this trend will be influential players who are already pushing cashback debit. Melvin says PayPal’s PayPal Everywhere push, which is encouraging shoppers to use its cashback debit card both online and at point of sale, is a strong example.
Melvin says the buy now, pay later category, broadly, has seen some scaling back in promotion, but she sees this changing as consumers seek alternatives to credit cards.
Read more: Why Cardholders Are Ditching Miles and Points in Favor of Cashback
4. Consumers’ Need for Financial Flexibility Will Drive Product Innovation
The lines between product categories continue to blur, one example being credit card purchases that can be split into buy now, pay later installment plans. Another is debit card purchases that can be converted to installment plans.
The desire for financial flexibility has become particularly strong among millennials, according to the Comperemedia report. Company surveys found that flexibility moved to the top priority among millennials in 2024, whereas it was in seventh place in 2023. Across all consumers, demand for financial flexibility increased significantly from 2023 to 2024.
In 2025, Melvin thinks this trend will coincide with financial marketers’ efforts to get consumers to consolidate their financial accounts, both through product families and loyalty programs that play to a membership mentality.
"We can expect brands to foster deeper customer relationships with integrated, multipurpose financial solutions and marketing that shift control into the hands of the consumer," says Melvin.
One tool that some institutions may use is the Visa Flexible Credential, scheduled for rollout by the end of 2024. Melvin points out that the first organization out of the gate with the "one card to rule them all" will not be a bank but rather Affirm.
Melvin says product design that incorporates flexibility will be an advantage in 2025.
"It provides more autonomy and respect to the consumer, based on what exactly is going on with their financial situation at the time," says Melvin.
