Pic from Bloomberg
NEW YORK: Whether you’re riding the subway, walking to an airport gate or waiting for the bus, there’s a certain kind of advertisement that has become increasingly difficult to miss: pitches for technology-based financial services, from credit cards to online payment platforms to digital banking.
Financial technology (fintech) companies are increasing their marketing efforts in metropolitan hubs such as New York, San Francisco and London as part of a concentrated effort to reach a wider range of consumers.
Over the past three years, fintech ad spend has grown an average of more than 45% year-on-year (y-o-y), according to Outfront Media Inc, an advertising company whose clients include fintechs such as Mercury, Brex, Inter & Co, Klarna, CashApp, PayPal and Venmo.
The growth in spending comes during a time when fintechs, from payment firms to so-called neobanks, are becoming increasingly popular among everyday users and no longer just the ambitions of founders and venture capitalists to create a high-tech future of financial infrastructure.
They are reaching a level of maturity ripe not only for expanding their customer bases and product lines, but also setting the stage for potential initial public offerings or acquisitions.
“For forever, fintech companies were very aligned with digital-native businesses,” said Jeff Titterton, chief marketing officer at payments company Stripe Inc, which was founded in 2010 by now-billionaire brothers Patrick and John Collison and forayed into brand advertising for the first time last year.
“But what we’re seeing right now is that they’re taking on a broader purview.
“Their addressable market is continuing to grow, which is why you see us showing up in places where we might not have before.”
Fintech company Brex, known for its corporate credit cards and expense-management capabilities, is no stranger to out-of-home marketing strategies, and has been launching billboard campaigns since early in its inception in 2017.
But the San Francisco-based firm said that its out-of-home advertising spend has consistently increased 30% y-o-y and the company recently pivoted the focus of its messaging from serving startups to business across segments and sizes.
“Before I joined Brex, we never targeted the enterprise audience specifically in our out-of-home efforts,” said Scott Holden, chief marketing officer at Brex, who joined the company in 2023.
“We really focused on using that medium to sell our corporate card to startups. Then when I joined, we launched our out-of-home messaging to be about Brex being a unified spend platform.”
Digital banking platform Mercury, founded the same year as Brex, has also expanded its messaging to market the company as doing more than just providing banking software to companies.
In April 2024, Mercury launched a new consumer banking product called Mercury Personal for founders and investors, providing them access to advanced digital banking tools, such as free wire-transfers and access to multiple debit cards.
“I’d say the first couple of years we were focused on communicating that Mercury is banking for startups,” said Heather MacKinnon, head of brand at Mercury.
But in 2024, “our goal was to reposition Mercury as more than a bank account and associate the company with banking in general and financial software”.
Mercury’s 2024 campaign touts phrases such as, Banking should do more. Now it can, and Powerful banking. Simplified finances.
It’s already a stark contrast to the company’s startup-targeted advertisements the year prior, which included messaging like, The foundation startups bank on, and How 100,000 startups bank.
Fintechs’ push towards appealing to more of a mass market comes during a time where many are facing increasing regulatory scrutiny, particularly around bank partnerships, compliance and customer deception around hidden fees.
Last year, one of the largest fintech middlemen companies, Synapse Financial Technologies Inc, collapsed, setting off a cascade of problems for firms that used the now-bankrupt company to transfer funds to banks and drawing regulatory attention to the industry.
Mercury, which sued Synapse in 2023, also faced scrutiny for letting foreign companies open accounts through one of its banking partners, Choice Bank. — Bloomberg
