Banking on Gen Z, Pt 1

In episode one of a two-part Believe in Banking podcast series about Gen Z banking, Sean and Gina tackle the topic on the minds of every banker out there – the influence and impact of Gen Z on banking and beyond. They invite on Adrenaline’s Chief Brand Officer, Juliet D’Ambrosio, for a dynamic discussion in advance of the new report from Adrenaline called “Gen Z and the Future of Finance: A Generational Guide for Banking Leaders,” available in October. Their conversation covers what makes Gen Z such a myth-busting generation, addressing everything from how they think about money to what they think about brands. Although they have all the internet’s information right at their fingertips, they seek out financial experts and want human interaction in their banking relationships. Learn more about how banking can meet the moment with the generation that came of age in economic uncertainty and recession. 

Text Transcription

Intro: This is Believe in Banking, a podcast series for decision-makers, influencers, and leaders featuring experts taking on the financial industry’s most pressing issues with insight and empathy. The podcast features information and conversations designed to enlighten and empower. Here are your Believe in Banking hosts, Sean Keathley and Gina Bleedorn.

Sean Keathley: Welcome to our podcast for Believe in Banking. I am Sean Keathley, CEO of Adrenaline.

Gina Bleedorn: And I’m Gina Bleedorn, President of Adrenaline.

Sean Keathley: Gina, did that feel good to say?

Gina Bleedorn: Yes.

Sean Keathley: Well, if we’re honest, Chief Experience Officer, not only had you outgrown, but you kept using the abbreviation, which is also CEO. So we knew it was time.

Gina Bleedorn: Technically, Sean, it is-

Sean Keathley: CXO. In all seriousness, Gina, congratulations. A incredible career at Adrenaline, 21 years, and we couldn’t be more proud. You’ve earned this. Please, please enjoy. We are so, so excited to let you lead this company as the president of Adrenaline. Congratulations.

Gina Bleedorn: Well, Sean, thank you. I’m thrilled. I intend to do the title justice.

Sean Keathley: We know you will. And let’s also introduce our Chief Brand Officer, Juliet D’Ambrosio, who’s going to join as a subject matter expert today, given the conversation we’re going to have. Welcome, Juliet.

Juliet D’Ambrosio: Thanks so much for having me on the podcast. So one of the things that we speak with our clients most often about, whether we’re talking about brand or we’re talking about branch experiences, is Gen Z. All of our clients are interested in what is on Gen Z’s mind and how to best meet them where they are. And so, we decided to take both a long and a wide view looking at Gen Z, what their preferences are, how they bank, how they think about money, what they prioritize. And so our new report, it’s called Gen Z and The Future of Finance, is a generational guide for banking leaders for this generation.

Juliet D’Ambrosio: And again, Gen Z are those born from 1997 to 2012. It’s going to be available on Banking Dive in October and then available on Adrenaline’s own website in November. And I think what’s most surprising here is that Gen Z is able to bust all the myths that we might have about a generation that is digitally native and how much they are interested in the relationships, the in-person experiences that are at the heart of banking. You would think that their banking and financial outlook on the world is entirely digital, that there would’ve been a wholesale rejection of relationship-based banking, physical-based banking.

Juliet D’Ambrosio: But what is so stunning is that it’s the opposite. And that it’s a little bit true of millennials, but actually, and this is something in our report that is myth-busting too, is that Gen X uses digital channels. So, Sean, you and me use digital channels more than our children might when it comes to banking, or at least have preferences around that. So I think that if there is a big theme, it’s not what you think. It’s sort of counterintuitive to digital native generation and what that says about what people are looking for, what Gen Z consumers are looking for. If they’re not looking entirely for digital experiences, what are they looking for?

Sean Keathley: And Juliet, is it because you and I’s life moments are different at our stage, and they’re at a moment where the mystery of finance is overwhelming, financial literacy is paramount? Some of them are entering their first time ever not living at home, trying to manage a budget. So they’re needing advice, and we’ve got busy, hectic lives. So we’re in a more of a maintenance, everyday maintenance mode. Could you extrapolate that?

Juliet D’Ambrosio: Yeah, and one more thing, which is I actually think the driving factor, which is that Gen Z came of age in economic uncertainty and recession. They’ve sort of lived through or watched their parents live through economic recession and then COVID. And so, the idea of instability being a common thread or the norm has driven them more towards this idea of, “I just want to trust where my money is going, and I see that anything could happen at any time, therefore, I want to know what I’m doing a little bit more.”

And then, for us, for you and me, Gen X, it’s all about convenience. We’re the sandwich generation. We got busy lives. We’re at sort of the zenith of career, and so the idea of convenience has taken over.

Gina Bleedorn: Juliet, that last point you just made to me is one of the most interesting parts. Is there some truth that because Gen Z has been empowered, enabled, they’ve had people to talk through everything most of their lives, very accessible, available parents, an information age of any question can be answered, and also, you can ask any question? How much is that a factor of their approach now to finances that I shouldn’t just assume, but I should be able to talk to somebody and ask anything I want?

Juliet D’Ambrosio: Yeah, I think that’s a big sort of shift between the generations where there was, it’s not shame in not knowing what you don’t know, but there is a sense among Gen Z that they’re not supposed to do it all themselves. So the hyper independence that characterize Boomers for sure Gen X as latchkey children. I’m making big generalizations. But that sense of hyper independence, “You’ve got to take care of yourself. You need to be responsible. You’ve got it covered. You can rely on you.”

With Gen Z, it is there is more of an expectation of you’re not supposed to just rely on you. You’re supposed to rely on your friends and your family and the internet and the broader communities of which you’re apart on Instagram or Twitch or whatever. There is also the idea of crowdsourced information that has always been at the fingertips of Gen Z, which has further reduce the burden of shame for asking for financial advice and really this idea of not having to know it all, but I need to ask people who are not smarter than me, but people who know more about this subject.


Gina Bleedorn: Is it also true, Juliet, that the younger generations, yes, Gen Y, younger Gen Y, but also Gen Z, aren’t necessarily following the same traditional linear life journey that certainly boomers, certainly the Silent Generation, and somewhat Gen X and even Gen Y felt beholden to follow.

And so because of that, they’re extra emboldened to again asked these questions about what if this and what if that, it’s not traditional, get a house, get a family, have kids order of things. How much is that impacting, do you think, their view on finances and the role of financial institution could play in their lives?

Juliet D’Ambrosio: I think it’s big. I think you’re really touching on something big. What I would say for millennials, especially both older millennials and younger millennials, is that it’s not that they had some kind of, “Oh, let’s question everything and rethink how sort of the milestones of the journey of life.” It is that it is harder for them to get out of student debt to buy a home. Life is less affordable than it was. Millennials, especially, are, as a rule, in not as great financial straits as their boomer parents, although millennials have made big strides in the older millennials in the past few years.

So it’s not that they are Bohemian in their thinking. It is that they have been sort of locked out of it. The second thing I would say is that millennial generation had the age at which they became parents is older, and so they just had more time. And so their need for financial advice and the life path comes a little bit later, and you can see that play out just in the people that you know who weren’t having kids for the most part at 24. It was 34 or 37 or 40 or whatever that is. For Gen Z, Gen Z is the first generation in which… And this is really interesting to me. I just read about this, in which the notion of a gap year has become normalized.

Juliet D’Ambrosio: We are seeing year-over-year gains in people choosing to not do the thing where you graduate high school, and you go to college, and you go to college, and you go to grad school, and you go to grad school, and you have two internships, and you get a job. And so that plays into exactly, that supports exactly what you were saying, Gina, that the life path of Gen Z, it’s still too early to really know whether they are going to follow a more linear path. But it seems as if they are beginning to question that what generations before them have sort of taken as received wisdom.

Sean Keathley: Well, if you start with a skip year, you’re automatically taking a detour down tradition.

Juliet D’Ambrosio: Yeah.

Sean Keathley: If that’s more common versus less common, that’s probably the beginning of something right there.

Juliet D’Ambrosio: And also they’re comfortable. There’s this idea of the resume gap for Gen Z that the idea, not only of the gap year, Sean, that you don’t necessarily have to go straight to college, but that you can have gaps in your resume and you are unapologetic about it so that you are not driven to stick with a job that you aren’t completely satisfied with or doesn’t satisfy your work-life balance or doesn’t have the kind of purpose that you’re looking for.

“I’ll take a year. I’ll take six months. I’ll moonlight at a bakery, or I’ll be an Uber driver or whatever until I figure it out.” And they are very comfortable with that idea of gaps, which means that we’re beginning to see the signs of just a less conventional life journey where banks, credit unions, financial institutions have to rethink the role that they play. And at the same time, that the generation is saying, “I want to know more about finances. I need to ask, and I want to ask from a trusted source.”

Sean Keathley: There’s another trend that’s just shocked me to hear here in Atlanta. The power of branding is at work with universities. And you just look at the Saban Effect in Alabama. The number of out-of-state undergrads going to Alabama, post Nick Saban’s run of multiple national championships, is astonishing. The brand of Alabama is attracting students. Well, guess what? Kirby Smart at the University of Georgia, two national championships in a row. Guess what’s happening? Same thing.

Kids from California are going to Georgia, New York, all over the place, and it is getting harder to get in to the University of Georgia. They were encouraging people that don’t get in, “If you will go abroad for your first year, that will help you get accepted,” because they’ve got a funnel problem. And so literally, you’ve got universities sending people abroad. So you can see that this group is going to follow an untraditional path, probably one way or the other

Gina Bleedorn: As they get into the workplace, a recent survey by the Muse actually said that 80% of new Gen Z hires think it’s acceptable to leave a job in six months if it doesn’t meet their expectations. And so the new reality of what turnover looks like in a job market that we already know was difficult just because of this younger mentality that, “I don’t want to regret what I’m doing, and I deserve to be happy, and I can change my mind, and that’s okay.”

All of which are good things. But they manifest as some real difficulties for businesses, especially for financial institutions that require frontline staff, often of whom tend to be younger, and the impacts of just talent recruiting for all parts of the business with the changing circumstances of how Gen Z is living their life. It just has impacts all around.

Juliet D’Ambrosio: And a lot goes back to this is the beating heart, I feel like. If I think about all of our podcast conversations, everything that we’ve explored, it pulls us back time and again to the idea of purpose. And in this case, it’s the financial institution’s purpose that is rethought or calibrated to meet the changing idea and expectations of purpose for a generation for whom purpose is everything.

The idea of gap year, the idea of leaving a job, the idea of finding your own path is really another way of saying, “I want to live in accordance to my values or in accordance with my values and towards the purpose to which I personally am aligned, not necessarily society’s expectations. And I want to be empowered to be able to do that.”

And the truth is to do that, it takes money, and money takes thought and planning and access and tools and resources and all of that. And so there’s such a big opportunity, I think, to connect the dots between the purpose of Gen Z and how they are rethinking and reshaping what their future means and the purpose of the financial institutions that serve them and how they communicate around purpose, but really how they show up around that purpose.

Sean Keathley: Well, of course, because if they’re willing to leave a job in six months, how loyal are they going to be to a financial institution, especially one they’ve not had the chance to actually build any loyalty with over time? So it is not going to be one that was rate-driven or had just a digital ad that caught their attention. They’re going to need to have relationships advice.

So I think that’s a new challenge where we’ve got someone, Gina, 21 years with a company that’s not how her kids are going to be thinking about their career. And so it is a new conundrum for an ever-complex banking relationship. But the patterns are something you can react to, and it’s time to determine your strategy now because if you are working on your branch network as those branches actually open, this is a key client that you need and want, and they’re going to interact with you differently.

Gina Bleedorn: One thing we have stuck to the beating heart, Juliet mentioned really over the past decade and a half or so with branding in regards to purpose. As you think about, as a financial institution, how to appeal to this younger generation, now the Gen Z, both from a recruitment standpoint and from a customer standpoint think about your purpose and your values as being almost identically internally and externally reflected.

So there’s not some policy that is in an annual report that then doesn’t have any actual relevance to the way you treat employees, or there’s not some internal values that are secret that you don’t make manifest in how your employees treat customers. So if you think about having that solidified purpose and then having it reflect externally and internally, that can use purpose to your advantage in both ways.

Sean Keathley: Inauthentically because if it’s something that some marketing team or agency created for you and now it’s getting dust, and it’s not how you’re living the culture of your institution, people will see right through it.

Gina Bleedorn: The Credit Union Times actually reported recently, Gen Z is young enough that they haven’t actually built loyalty to a specific financial institution. They certainly may have an account somewhere, but they are more willing to switch to a better alternative if one presents itself than any other generation before them. So they’re not afraid. The idea of even perhaps the digital hassle of doing so, no big deal. So it is both a threat to incumbent young customers as it is also to staff as it is an opportunity to attract new.

In fact, more than 4 million new accounts will be opened by Gen Z in the next three years. That’s more than 12 million new customers. So this is an up-and-coming generation that we haven’t thought perhaps as much about in the past as we need to now. And nearly half of them already have a transaction account. So they are already doing business with a traditional bank or credit union or maybe a neobank that they’re in there. You just haven’t paid that much attention to them yet.

Sean Keathley: Gina, you mentioned the percentage of Gen Zs that have an account already nearing half. But even most of those is more than one because those were started through a digital relationship, probably a transaction, a purchase through Instagram, a purchase through TikTok, and so that is probably not going to be enough to make them loyal. But I think what’s going to benefit banking systems, traditional ones that use branches, these people also went through the pandemic at really key times.

Did anyone hear about the Zoom CEO recently telling everybody to get back to work at his company? He was zoomed out. I was like, “Wow, that’s like Coca-Cola saying, ‘Quit drinking Coke.'” But it’s so true. The fatigue is absolutely real. And if you’re already attached to your device, friends tell you where they are through Snapchat, and you get advice through TikTok, and then you get deprived of in-person through a pandemic. When money becomes scary, and you need advice, guess what they want?

Not just an account opening that you could get through some digital app or some website. They want advice. And we are hearing that from more and more CEOs. They are concerned that their branches are staffed with people that are serving up transactions and order-taking. But the people walking in, especially this generation, wants to open that account with advice, and you need to be able to meet them at the moment to really create a meaningful relationship.

Outro: You’ve been listening to Believe in Banking, a podcast series created to empower decision-makers, influencers, and industry leaders in financial services. Be sure to also join us on our flagship site,