Winning Gen Z in a Relationship Economy

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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.

Gina Bleedorn (00:18): Welcome to our Believe in Banking podcast. I’m Gina Bleedorn, president and CEO of Adrenaline.

Juliet D’Ambrosio (00:24): And I’m Juliet D’Ambrosio, Chief Experience Officer at Adrenaline.

Gina Bleedorn (00:28): Today we are going to talk about Gen Z. The generation that you thought was little children, but is actually in their teenage years and as old as up to 29. So, this generation is very real in a business context and in the workforce, and in a lot of ways is misunderstood. For that reason, Adrenaline has just published a new report. We call it Winning Gen Z: A Data-Driven Brand To Branch Playbook For Financial Leaders. And Juliet is really our key force behind the data in this report, which included original research across the country that we have put into the context of what it means for what our clients are facing.

So Juliet, I want to open it up to you to begin talking about this generation. They are here now. It’s not the future. It is a current need to figure out they’re already driving growth. They’re beginning to enter peak earning, borrowing, and spending years. Talk to us about Gen Z.

Juliet D’Ambrosio (01:42): Well, sure. I would love to. I’m happy to share what I’ve learned and a data-driven insight for financial leaders, but I’d also love to preface this by saying that Gen Z is near and dear to my personal heart because I have two, count them two, actually, I think I have three children that fall within the Gen Z parameters, which to give some context are born anywhere between 1996 and 1997 and 2012.

So Gina, you’re absolutely right. We are looking at my high school freshman qualifies for Gen Z, but so does my 22-year-old who is very much in that Gen Z curve. And the other way I’d like to preface this is by saying I joined Adrenaline seven years ago. And so 2019, pre- COVID, different era, and at the time, every conversation that we had with banking leaders was about Millennials. How are we going to position to attract Millennials?

And over time, I would say in the past four years, that conversation has shifted because Millennials are older now. They’re in their 40s. They’re making VP in their roles, and Gen Z is the future and that’s what everyone has their eyes on. So the need to understand this generation, both anecdotally, as I do, just having them in my house, but also from a very objective way… What drives their behaviors? How are they similar to Millennials, Gen X and the generations that came before? How have they completely upended banking behaviors, not only being digital natives, but digital everything generation? So this report was eye-opening to us for a lot of reasons. And as we’ve begun to share it with the industry, a lot of it comes down to busting some myths. So I’d love to have just a conversation about that.

To preface all of this, I do want to say these are not kids living in their parents’ basements. Seventy-one percent 71% of Gen Z is actually financially independent. They are not also just with allowance money rolling around in their pocket. Gen Z is the recipient of the greatest intergenerational transfer of wealth. Over the next seven years, there will be $85 trillion – that is T trillion – in wealth transfer from Boomers and older Gen X to this generation. And their spending power is projected to reach $12 trillion globally just in the next four years. Thirty percent of the workforce will be Gen Z by 2030.

As this generation comes into their own, they are the ones that are making big life choices, spending choices. It’s just imperative to understand some of those things that make them tick. And so I can’t wait to talk with you about busting some of these myths.

Gina Bleedorn (05:05): Thank you, Juliet. As we get into how they feel about finances, we have found that their financial influence is rising faster than their financial confidence, and they don’t feel particularly confident or are confused. Talk to us about that dynamic.

Juliet D’Ambrosio (05:24): Yeah, it’s really interesting. That’s one of the defining tensions of the generation, but also one of the biggest opportunities for community banking, especially to meet a need. So Gen Z is, first of all, we need to say they’re very digitally connected, full stop. And that drives a lot of their behavior. But you’re right in this idea that there’s a lot of optimism this generation has. Fifty percent feel optimistic about their financial future. I’m going to be doing better five years, 10 years from now than I’m doing today. I’ll do better than my parents are doing today. At the same time, 36% of the generation scratches their head around the idea of financial planning. They say it’s very confusing. And 70% reports feeling not just a little anxious, but high anxiety around the concept of finance.

So on the one hand, you have a generation that feels very confident about their financial future. On the other hand, you have a generation that feels anxious, and anxiety is one of the key defining factors of this generation. They feel anxious about making good choices, and they are confused about the topic of finance. What’s really interesting from a digitally-driven generation is where they’re looking to get some confidence and some real expertise that can help them to balance that tension and turn the anxiety into true solutions and plans for the future.

Gina Bleedorn (07:13): So we’ve got a paradox here on a few levels. Some are confident, some are anxious, but all of them are digitally native and digitally connected, yet emotionally disconnected. Talk to us about that.

Juliet D’Ambrosio (07:29): It’s really interesting. And I think anyone of any generation who has spent time, too much time getting sucked into social media or digital platforms can likely relate to this, but Gen Z is particularly affected. They spend seven hours a day on their phone. They run an average of 10 core platforms every single day, but a majority of them – almost 60% – report feeling lonely, disconnected, or isolated.

On the one hand, they have every platform on earth connecting them just in their pocket on a handheld device. And on the other hand, they’re seeking relationships. They’re seeking connection. And in fact, the statistic that we learned that is most stunning to me is that 50% of them wish social media did not exist. If we think about a lot of the assumptions that we make about Gen Z, or they just want to take photos that look good on Instagram, or this is the TikTok generation, they can’t interact in the real world. That’s actually not true. They are absolutely engaging digitally, but they’re seeking relationships.

And where community banking plays a role here is that I want all of our listeners to hear this loud and clear: Gen Z is not looking for another app. They are not looking for anything other than a bank or a credit union to establish a relationship with. And in fact, we know that one-third of them are planning to switch financial institutions just in this next year. They’re seeking a new financial relationship with a bank or credit union. Eighty percent of them have their PFI with those banks or credit unions. And that doesn’t mean that the Chimes of the world, the SoFi’s of the world don’t take pieces of that. They have a product with those brands, but their primary relationship where they’re looking to get advice and to establish and maintain trust is still very relevant.

And if we think about where they’re turning to get this advice now, it’s really interesting. First of all, a lot of them turn to mom and dad, grandma, grandpa, to friends, but a huge percentage of them are going to TikTok, actually called FinTok. So you have these creators that are producing highly influential content around financial advice geared to Gen Z. But Gen Z is smart and they’ve been on their digital devices long enough to know what’s fake and what’s real and to have that meter built in. So while they’re getting this advice there, they actually, I think 50% of them don’t trust it. They’re like, “Yep, I hear it, but I know that I need to have some healthy skepticism of it.” And 64% of Gen Z say that they more trust advice and financial intelligence when they get it from an advisor, from a true financial advisor, that they can get as they walk into a credit union or a banking branch that they establish that relationship with.

And I think it’s important that we begin to understand that motivation that digital is table stakes. They’re going to want to be able to have the convenience of digital in their hand. But when it comes to things like opening an account, problem resolution, absolutely having conversations around savings, around buying their first home, around just learning more, they still are looking for that to happen with a bank or credit union with people that they believe in and that they trust.

Gina Bleedorn (11:41): So you’ve said that they’re smart. And I think what you mean by that is not just intellectually smart or that they’re necessarily smarter than other generations, but smart about digital, digitally discerning because they have grown up with it. So they are quicker to see through what people are really doing. And when an influencer is really selling something what that is versus is this genuine advice? So that’s the kind of the distrust. That’s really interesting along with that stat that half of them wish major social platforms didn’t even exist. That says a lot and is also in alignment with a lot of the research over the last few decades, even around just the impact of social media on the temperaments and ultimately emotional wellbeing of younger people – although we’re talking not just teenagers, but people in their 20s. But all of that leads to, I think, this important, almost critically necessary role that banks and credit unions can step up into to give the right advice for the betterment of their lives.

When digital becomes truly table stakes, which it is, they don’t wonder who has the best app. They just assume you have an app and that it will work, and they can do whatever on it. So trust becomes the differentiator. With these high stakes financial decisions, Gen Z knows they need human guidance, not just digital tools. So that’s very interesting and also counterintuitive to what most would assume the digital people want to do things digitally. But actually the digital people are smart enough to know what they can’t just do digitally. So what do you think financial institutions need to be doing about this? How should they rethink their role and what are some of the implications of how that shows up in things like their brand and things like their branches, the two areas that we typically touch on in this podcast?

Juliet D’Ambrosio (13:53): Yeah, that’s a great question. And I’m glad that you clarified what we mean by this generation is smart. I think if I had to choose a word, it is this generation is discerning. They have grown up with so much information at their fingertips, literally historic amounts of information that is exponentially growing every day, and they have learned to be discerning about it. And I feel so proud of younger people when I see examples of that discernment. And so from the brand side, that discernment looks like a few things. One, there is, and I feel like we might sound a little bit like a broken record here, but the idea that Gen Z cares about a brand’s purpose. They do so more than any generation previous, even more so than Millennials. They want to know that the brand, any brand, but especially their bank or credit union stands for something, and that it has values that align with their own.

And I want to make a very clear point that two out of three Gen Z consumers who are looking to switch, by the way, two out of three of them would choose a financial institution for values alignment. So that’s how important that idea of not only having a purpose that shows up on your boardroom walls or on your website as a statement, but a purpose that is lived and expressed in every area of your organization internally, driving your culture externally throughout your brand presence, your marketing, your community, involvement, who you are and how you show up. So the brands that are winning with Gen Z have a really strong purpose.

Just as an aside, one of the key things that we learned by looking at some of this research is that Gen Z loves brands with purpose, not just financial brands. And the one that I think kind of blows my mind when I think about it, the number four most beloved brand by Gen Z, you would think, is it a digital brand? Is it a gaming brand? Is it Switch? Is it Twitch? Is it whatever? It’s Crocs. I mean, Crocs, they are rubber clogs with holes in them. Gen Z loves it not because of the fashion that it represents, but because Crocs is who it says it is. It has a purpose. That purpose is to provide comfort and to do so in a way that is accessible to everyone. And so because they have not changed, they’ve lived up to that purpose, they’re still just rubber clogs with holes in them. Gen Z absolutely loves that brand. And of course, we are not recommending that your bank or credit union makes some kind of ugly shoe that attracts Gen Z, but the idea that you stand for something and that something becomes your DNA and it doesn’t change over time and that you demonstrate commitment to that purpose.

The second thing that I think is really critical is the idea of authenticity. And this gets back to that idea of discernment, that brands especially and branches, which we’ll talk about in a minute, but brands that are able to express who they are, what they believe, and who they serve in real and authentic ways, not trying too hard, not putting on too much of a sales pitch, creating content that is both educational. There’s a meaning, there’s a purpose behind it, but also feels real. There is a definite shift from the idea of polished and perfect to authentic and real. So the brands that are embracing that part of their expression, showing and reflecting back real regionality and differences in both their brands and their branches, in the idea of photography and how they reflect back, who their customers and their communities and their members are and what that looks like versus smiling happy people in stock photography, those kind of brands are winning.

And for financial brands, especially that serve communities, there’s a real opportunity to leap in and show what you believe in and how you live that belief through service, through expertise, through helping communities, through your customer relationships that I think is unexplored.

Gina Bleedorn (18:47): I want to underscore something you said, Juliet, for listeners about how brand shows up or how purpose shows up through brand. So many of our clients have purpose and usually good purpose, legitimate purpose, but what Juliet is describing in the way that in particular discerning Gen Z expect to see culture is imbued in every aspect of how you show up. So the purpose that may honestly be drilled down to your core culturally, if you don’t look like that and sound like that and act like that in everything you do publicly through your brand, marketing, social comms and products and services, that’s what they sniff through. So just an underscore on that purpose and how it manifests in every aspect of the brand has to be apparent for it to be real, in particular to Gen Z.

Switching then to the branch side of the house, the idea of being the trusted advisor is what we want to get to. And I think most of us would admit that most banks and credit unions are not getting an A+ on how they show up in doing that today in the branch. And a lot of that is because the branch purpose itself has been shifting from being a place where transactions happen to being a place where advice happens. And that advice is everything – from problem resolution to how to open an account to how to expand and spend my money with accounts that I have. So talk to us, Juliet, about Gen Z’s use of branches, which is also counterintuitive. What are they using them for today and what do we need to plan for to keep them tomorrow?

Juliet D’Ambrosio (20:36): Great question. And this is one of the biggest myth-busting learnings that we got from this report and other industry tracking reports that look at Gen Z’s behavior. So Gen Z uses the branch. Not only do they use the branch, they use it at least as much as generations before them, which is again, this idea that we can go back to that idea of being hyper-connected digitally, knowing that you have that convenience in your hand, but seeking connection, relationships, and belonging. We know that 65% of Gen Z want to open accounts in person, full stop. And we also know that those accounts that are opened in person are stickier than accounts that are open online. If we look at just the retaining of those relationships over 12 months, there’s much higher loyalty when they’re opened in person. So Gen Z wants to open accounts in person.

They also, 25% of them want in-person advisors for those big life moments, key financial milestones that there is a real path to be tread one way or the other. However, there’s a delivery gap right now between how banking institutions are showing up and delivering for Gen Z. So we know they want to come in, they want to have these more advisory conversations, but 66% of their in- branch interactions, they come away feeling like it was a sales pitch. And remember, Gen Z, they really thrive on that idea or seek out authenticity and purpose. So it’s okay to have a product and to promote that product in the right way, but when they’re having these conversations, they really are seeking learning and guidance. And what they’re really looking for is what generations before have, which is the idea of personalized advice. So I’m not selling you something because I want to sell you something.

They’re coming into the branch to have a conversation. They are getting guidance and information around what the possibilities are, and those possibilities are personalized to them. The great news is that when this gap is filled, 76% of them will actually act on that advice. If they get great guidance, it doesn’t feel salesy, it feels personalized to their needs, they will actually follow that advice and transact. So this idea that the industry has known and has been moving towards for years, I think the good news is that you’re moving in a direction already that Gen Z is absolutely seeking. How can I think about the branch as a place less around transaction, although that will still happen and can happen in self-service ways, in ways that Gen Z happens to love the drive up. We know that also just because of the convenience, but when they’re coming in for advisory and guidance, how does the branch, how is it designed to support conversation, consultation, real connection? How does it support learning? This idea that we have a generation that’s optimistic, but feels nervous and doesn’t know what they need to know around finance, how do we become a real resource for the community and use our branches as connection hubs and relationship hubs for a generation that is so hungry and seeking those kind of relationships?

Gina Bleedorn (24:29): To bring all that data and these insights into what do we do, in a way, it affects so much everything from brand to marketing, to product, to service, to delivery in every channel. So no big deal. But instead of going into all of the tactics, some high level takeaways that I’ve learned from Juliet and from our research in this report, they want experiences that are meaningful and relevant to them. And that shows up in the highest level as trust. So anything you can do to build trust, much more so than anything digital or products, service moments are building trust. And not that products and digital don’t do that too, but think about how to create a premium service experience. That is a strategic imperative. Ultimately, winning is when you are positioning the branch as an advisory hub, not a transaction center. And I know that this isn’t the first time you’ve heard that, but that’s what you have to do and you have to get there.

Digital is not replacing human connection. So think about how you’re positioning digital. Again, it’s how banking gets done. It’s where they’re doing the banking. It’s not replacing the idea for human and the idea of you want to migrate them for transactions to digital, but if they have real needs, you don’t want them to feel you’re pushing them into digital for more complex service questions and advice. And then thinking about key life moments. That’s the advisory gold. Key life moments where banking and financial advice is needed – first kid, first home, first job, or uncertain financial times, what’s happening in the market, what’s happening in my life. Ultimately through transparency, through personalization, through consistency, all of these things will build trust, but success is no longer about just getting them to sign up for the products or the services, but giving them access to ultimately have clarity, confidence, and connection.

And banking is not a bad word to Gen Z. So as you think about particularly those of us in marketing trying to make something that we think they don’t think is cool, they don’t not think it’s cool. They know they need it. They don’t want less banking. They want better banking. Give them more guidance, give them more personalization, give them more connection to humans. That’s what I’ve learned that Gen Z wants from banking. It is not what I would’ve intuitively thought. So with that, we are, as we always are around this time of year, Q1 and Q2 in the throes of heavy event season, as you all likely know. Adrenaline is very much committed to being a thought leader and disseminating everything we know to help the industry. We’re very active during event season and this will mark 2026 as our most active to date. Juliet, can you share where we’ll be, where many of these themes are going to be touched on?

Juliet D’Ambrosio (27:48): Sure. First of all, we have our big event at Financial Brand Forum. That’s April 13^th through the 15^th. I will be leading not a one, not a two, but a three-hour workshop on winning Gen Z and a very practical playbook for today’s banking leaders. And Gina, you’ll be talking about the strategic value of differentiation through naming. So two big, juicy topics coming up for Financial Brand Forum. You’re turning right around April 19^th through the 21^st, and you’ll be speaking at BankSpaces in Bonita Springs, Florida with banking leaders that are thinking about the future of retail through the lens of everything – through real estate, design, technology, etc. And both of these, by the way, will be inclusive of a lot of these insights that we’ve been sharing today. And then finally, just in the month of April, we have two more events. One is called Eltropy Emerge. It’s April 21^st through the 24^th. It’s in Santa Clara, California, and there will be Adrenaline people there to talk about really the idea of new opportunities and growth for innovation. Then closing out just the month of April 27^th through the 28^th, I will be presenting to the Bank C-Suite Summit in Nashville, Tennessee to look at the future growth opportunities and the way to capture next gen for banking leaders. So I’m tired out just walking through our upcoming itinerary, but thrilled to start having some of these conversations and sharing everything that we know and also keeping our learning ears wide open.

Gina Bleedorn (29:36): Thank you, Juliet. Thank you for listening to this podcast. Hope to see you at some of these upcoming events. And until the next one, we’ll keep believing in banking. Hope you guys do too.

Outro: You’ve been listening to Believe in Banking, a podcast series created to empower decision makers, influencers, and industry leaders in financial services.

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