Competitive Compass

Gen Z and Millennials are doing great.Gen Z and Millennials feel fantastic about their financial situation. Please re-read the previous sentence. It’s easy to get caught in the doom loop that surrounds all of us. Doom & gloom gets more clicks, and we all know this, yet we allow the negativity to cloud our judgment.This summer, I wrote The Mythbuster Memo, my worst-performing newsletter for the year. One can’t make this up. Probably it was too positive for readers?IF you believe in data, then please consider that Gen Z andMillennials are feeling much better about their financial health. This helps explain the growth across the board, including premium cards, across various experiences, and new products.Patrick has a fantastic presentation on 2026 Financial Services Marketing Predictions. I’m happy to schedule this forthe first two weeks of December or in the new year. He identifies three key themes for next year:1.      Control Amid ChaosContinued macroeconomic uncertainty, combined with adecreasing interest rate environment, will drive banking competitors to highlight budgeting tools and lenders to promote refinancing as a proactive form of reasserting control.2.      Old Money, New TricksA surge in financial confidence among the youngest segments of adults will reshape brand strategy, as financial services companies target Gen Z adults as intrafamily influencers who can steer their parents to new products and planning techniques.3.      Simpler Is SmarterPremium card relaunches are pushing the boundaries ofproduct complexity, causing competitors to use simplicity as a differentiator in marketing. As financial brands refocus on checking accounts and primary status, doing the basics better will be a recurring theme.

Targeting and Channel Strategy in Q3 2025. What the Data Tells us about Issuer Intent? Fulcrum Question: If discovery is shifting to GenAI andtrust is being built on the margins, where does competitive advantage come fromnext? I typically spend 4-6 hours putting this newsletter togethereach week. Sometimes, I take twice as much time (this happens quarterly).The reason is that these two reports I feature today capture so much incredible detail that I struggle to boil them down to the key takeaways. Pulling out just two or three takeaways is like trying to pick a favorite from a buffet where everything matters. That’s what makes this edition one of the toughest and most rewarding to write.1. Q3 2025 Credit Card Application Report2. Financial Profiles - Q3 2025I highly recommend reading both reports in full. But ifyou’re short on time, or just looking for a guided tour, here’s what you need to know. Below, I’ve laid out the key takeaways of how each issuer is playing the game.Bank of AmericaBofA hosted its investor day event this past week, markingnearly 15 years since its last one. You can view the full 300+ page deck here.My goal was to validate what I saw in Q3 activity with the broader vision, and there’s perfect alignment. BofA is focused on quality over quantity. Product cross-sell and relationship depth are key priorities.

Gen Z wants to borrow smarter, faster, and on their own terms.The opportunity? Build the tools that meet them where they are. Fulcrum Question: Does our product help a user make a smart choice right now, one they’ll feel good about tomorrow?I always smile when people say Gen Z doesn't like credit, as I know this is not true. Today, I have some statistics to back up that smile. Gen Z is reshaping credit, incorporating the best elements of debit as a component.Gen Z is not a generation of spenders or savers. It’s ageneration of choosers.They want tools that are simple, transparent, and seamlessly integrated into their existing shopping and payment processes. BNPL’s rise is about gaining control and confidence. The brands that appear at checkouts makeflexibility feel intuitive and win the current transaction, while also being front-runners in gaining long-term loyalty. BNPL’s Blueprint: Empowerment in Four TapsBNPL’s rise is not a fluke. What started as a short-term lending tool has evolved into a frictionless way for young consumers to gain greater control over their finances. And the numbers show it.The result: BNPL feels modern. It feels like it's been designedfor them.From Control to Confidence: Why This MattersDig beneath the behaviors, and a bigger motivation comes into view: control. And with it, something even more powerful: confidence. Gen Z doesn’t want to be told how to manage money. They want tools that work like the rest of their digital life: intuitive, transparent, and available instantly.That’s why the best BNPL providers are doubling down on clarity. Terms are easy to understand. Installments are visible at checkout. Alerts remind users what’s due and when. And if something slips? The UX doesn't punish, it guides.BNPL proves this: when you treat the user as capable and in control, they repay you with trust.The TakeawayThe future of credit isn’t about interest rates or APR calculators. It’s about trust at the moment of action.Whether your customer is buying sneakers or booking their dream vacation, they’re evaluating your product on one thing: Does this help me get what I want, without surprising me later?Get that right, and you don’t just win the transaction; you also win the customer.You earn the repeat. You earn the relationship. You earn the default position in their financial life.

The New Chemistry of GrowthMoney 20/20 this year was less about competition and more about connections/partnerships; everyone’s finding their element. Walking the expo floor at Money 20/20 in Las Vegas thisweek, it struck me that the word “alone” is fading from the payments vocabulary. Wallets are partnering with AI firms, banks are collaborating with crypto firms, fintechs are teaming up with banks and brands, and even credit unions are forming partnerships with one another.Fulcrum Question: If you’re in cards, retail banking, or payments, the question to be asking is, “Who will partner fastest and smartest?”Conclusion: The Chemistry LessonIf Money20/20 taught us anything this year, it’s thatgrowth is no longer a solo pursuit; it’s a shared reaction. The future of commerce won’t be written by isolated innovators but by the bonds they form.Every partnership, whether PayPal bonding with OpenAI, Amex linking with Coinbase, or Comperemedia fusing with Equifax, adds a new element to the ecosystem.The most potent compounds are those in which each elementamplifies the other.That’s the chemistry of 2025.That’s the new formula for growth.Find your element. Form your bond. Start your reaction.

Today’s edition covers two big moves in cards and banking.A deep dive with Citi’s Pam Habner on the launch of Strata Elite and the premium card renaissanceA fast read on the Q3 earnings momentum that is reshaping card marketing and product strategy Fulcrum Question: Are you building for the earn and burn of today, or the yearn and AI-driven journeys of tomorrow? Andrew interviewed Pam Habner, Head of US Branded Cards and Lending for Citi, and I’d recommend you skip reading my takeaways and watch the full video here. This conversation is a masterclass from one of the most influential voices shaping the future of cards today.1. The Premium Card Renaissance: Flexibility Over "Coupon Books" The definition of "premium" is shifting, demanding greater simplicity and user control. Affluent consumers, especially Millennials, will pay steep annual fees if the value is clear. Strata Elite proves that premium is aboutdelivering freedom, control, and experiences that matter.The "Earn, Burn, and Yearn" Hierarchy: Premium today is built on three layers. Earn is strong rewards. Burn is the ability to redeem. But it is the Yearn that now drives the category forward; exclusive access, hard-to-get reservations, and cultural experiences that resonate with younger cohorts. The future of premium lives in the Yearn.2. Strategic Partnerships as the Ultimate DifferentiatorCiti is leveraging its partnership assets to create a unique value proposition that is difficult for competitors to replicate.

Anti-Algorithm: Empowerment Over EfficiencyConsumers are pushing back against black-box systems. They don’t want to be told “the algorithm knows best.” They want personalization with transparency and control over their choices.In finance, this shift is stark. Algorithms drive credit decisions and product recommendations, but today’s consumer asks: are you empowering me, or just automating me? That’s the fulcrum every CMO faces.Flexibility is winning loyalty.Programs that let people pick their own rewards outperform one-size-fits-all offers. That’s why customizable rewards cards and subscription-style memberships like SoFi Plus, Robinhood Gold, or, like we discussed last week, Coinbase One resonate: they monetize loyalty while giving consumers agency.The future will go further. Imagine a banking app where you can tweak the algorithm yourself: setting the parameters for your robo-advisor or your budgeting tips. Mintel forecasts consumers will demand this level of explainability and co-creation.Strategic takeaway: Highlight empowerment. Make transparency, choice, and explainability visible features.The brands that invite customers into the process will feel like partners. The ones that don’t risk feeling manipulative.Will your customers sense a guiding hand, or invisiblestrings?The New Young: The Ageless ConsumerLife stages are blurring. Longevity is rising, milestones are shifting, and consumers are redefining what it means to be “young.” The old playbook: designing products by age bracket, no longer holds.A retiree might open a robo-advisor account for the first time. A millennial might delay homeownership into their 40s. A 65-year-old could be starting a business. The message is clear: design for life needs, not life stages.This shift shows up in credit cards. Premium cards are simplifying, not complicating. Citi Strata Elite and Capital One Venture X succeed with clarity. Simplicity resonates across generations, whether you’re 25 or 55.Another example is intergenerational money flow. Cash App thrives by making value exchange seamless across ages, from splitting dinner with friends to sending money to family. Consumers want brands that work across their entire lives, not just one chapter.Strategic takeaway: Retire the retirement talk. Position products around mindsets and moments, not birth years. Build offerings that flex as customers evolve.Are your products built for life stages that no longer exist?The Affection Deficit: Craving Connection in a Digital WorldIn a world optimized for speed and automation, consumers are lonely. Mintel calls it an affection deficit. Efficiency has stripped away human touch, leaving people craving warmth and recognition, even in financial services.Banking is no exception. Seamless digital apps are wonderful, but they risk invisibility.When a fraud scare hits or a savings milestone is reached, people don’t just want efficiency; they want reassurance, empathy, and acknowledgment.Even digital-first players recognize this. Robinhood added 24/7 live support after realizing chatbots couldn’t calm customers in moments of panic. American Express leans on its “membership” ethos to cultivate belonging. These examplesremind us that trust is emotional currency.Design for affection. A proactive note congratulating a retiree. A celebratory message when a savings goal is reached. A human advisor call at key stress points. These aren’t extras: they’re signals that your brand sees the person, not just the account number.Strategic takeaway:Reintroduce humanity into digital services. Blend tech and touch.Can empathy become a part of your KPIs?

Fifteen seconds change everything.Once you feel instant access, you expect it everywhere. After that speed, you don't want to go back to the old way.Last week, I tried something that left me genuinely amazed. I applied for the Coinbase Card, expecting the usual processof filling out details, approvals, and delays. Instead, what I got was a journey that lasted all of fifteen seconds. A few screens later, I had a brand-new credit card ready in my Apple Wallet; no waiting for plastic (or metal, in this case) to arrive in the mail. BTW, the card is beautifully designed, and I could spend a newsletter on just the story behind it and itsdesign. Fulcrum Question: When instant becomes normal, what becomes the moment only you can own? Behind the curtain, this experience is crafted by Cardless, Coinbase, and Amex, and it is how financial services should feel. It’s quick, it’s seamless, and it makes you wonder whyall cards aren’t issued this way already.Yes, I know “tech” is expensive, and we move with caution. However, here’s the deal: Amex’s Agile Partnership Platform, Cardless, Coinbase, and, don’t forget, First Electronic Bank all had to come together to create this seamless experience.

For decades, marketers believed story came first. Today, a new generation has flipped the script: the product speaks first, the brand follows.What drives brand love today? For younger consumers, the answer starts with product. Gen Z is reshaping the credit card market, expecting their card to be more thanjust a means of payment.They want simplicity, design that doubles as self-expression, and a digital experience that feels like second nature.Cashback is the starting point, but what they are really after is a product that helps them build their financial identity, safely, transparently, and with a touch of personalization.That’s where we see the contrast: Millennials have mastered the rewards game, moving seamlessly between points, perks, and partnerships. Gen Z is just entering the arena, but with very different instincts. Winning with them means rethinking how the product shows up in their daily lives before the brand narrative takes hold.Fulcrum Question: How do you build a brand that feels premium when your youngest customers believe the product itself is the brand?“Brand Follows Product” is a bold statement, and for the readers of this newsletter, who are mainly marketing executives, perhaps even a controversial one. Yet theevidence is mounting. The next generation of consumers is not waiting to be told what a brand stands for: they are deciding for themselves based on how the product shows up in their daily lives.This is not a generational quirk. It is the early signal of astructural shift in how loyalty is earned and how brands are built.The key points are clear. First, loyalty is being built less through storytelling and more through utility. Second, design and digital experience have become extensions of personal identity. Third, premium is no longer just a price pointbut a signal of purpose and belonging.If the product itself is the brand, then the real challenge is not crafting the narrative after launch but engineering the product so that it tells the story from the start.This is both a shift in mindset and a call to action. Ask yourself: is your brand still leading with story, or is your product ready to speak for itself?

We are in a moment where the Top 10% continue to remain strong, and the Bottom 10% have seen the most significant increase in their wages. I like to think of this as a moment where the edges are defining the next leg of the credit cardjourney. I touched on this idea in “Strength at the Edges,” and today we build on it.The Amex Platinum Refresh is setting the tone. That said, the center, prime and mainstream cashback are helping set the pace. And finally, the other edge, subprime, reveals where the next wave of product design may emerge.My goal is to identify the signals that matter so you can connect them to your reality. Fulcrum Question: If status is the spark and cashback is the engine, what keeps customers with you?

Fulcrum Question: How do we pivot from being SEO-obsessed to AIO-obsessed? Andrew and I were invited to a Fireside Chat at Meta’sFinancial Services Summit, and as a result, social media has been top of mind for me. It’s fascinating to see the progress Meta has made on the regulatory and policy front, which confirms to me that social media will be responsiblefor a significantly larger share of acquisitions in the future. I recently wrote about this trend in "Strength at the Edges," before my time at Meta, based on our data.Add in the progress made on AI, and RayBan’s, and I thinkMeta is unstoppable.Social + AI is now the new performance engine.What has blown my mind are these stats from Amr’s much-awaited upcoming consumer research report:62%of GenZs are using AI-powered tools (e.g., ChatGPT) to get a recommendation for which Credit Card to applyThis number is 60% for Millennials and 33% for the GeneralPopulation.Curious about what consumers are seeing, I tested three major AI platforms: Chat GPT 5.0, Gemini 2.5 Flash, and Perplexity Pro, with a variety of common financial questions. The results are eye-opening.The Tipping Point Is Already HereFor the last twenty years, the game has been Search Engine Optimization (SEO). We’ve all worked tirelessly to climb Google's rankings. However, a seismic shift in consumer behavior is currently underway, driven by AI.With a third to two-thirds of consumers using AIrecommendations, please identify how few products are being served up to the consumer.This isn't just a new channel; it's a new paradigm. WithSEO, the goal was to appear on a list of options for a user to research. With AI Optimization (AIO), the goal is to be the single best answer the AI provides. If your product doesn't appear, you will be completely invisible to this massive and growing audience. [I am considering Answer Engine Optimization (AEO) as part of your larger AIO strategy] Why AIO Is the Great EqualizerThe immediate reaction to this might be panic, but thereality is that AIO presents a monumental opportunity for every financial institution. Unlike SEO, which often favors incumbents with decades of domain authority, AIO levels the playing field.The time to act is now. We must shift our focus from the oldrules of SEO to the new, dynamic world of AIO. Start by asking these simple questions on today's AI platforms and see if you appear. If you don't, you've found your most crucial project for the rest of the year. ChatGPT is now a verb.By the time Google became a verb, consumer habits hadalready undergone significant changes. We knew Google had achieved escape velocity, and as one would expect, the trend continued to grow exponentially.We “photoshop” pictures, “Instagram” them, and “WhatsApp” folks.I feel we’re on the cusp of ChatGPT becoming a verb, if it hasn’t already. At the very least, ChatGPT now occupies that space in daily conversations. I use this as a proxy to reiterate why this trend is not optional. I recently saw an excellent podcast titled “AI or DIE.” There’s more truth in that title than not.