By Andrew Stevens, Principal, Banking and Financial Services, Quadient
The pressure on financial service organisations to win and retain customers is nothing new, with over 250 banks in the UK alone vying for consumers’ business. But in 2025, banks will face new standards of accountability that will shape their relationship with customers.
The new Consumer Duty rules are testing banks like never before as they face fines for failing to provide clear, readable communication. At the same time, banks are keeping pace with the changing demands of consumers, who are increasingly selective about where they take their custom, as they look for the best value for money in an uncertain economy.
In the next year, we will see banks and financial services employ new communication strategies to ensure compliance with regulatory bodies while keeping up with consumer demand.
Ending the era of ‘sell, sell, sell’
Traditionally, banks marketed products in a one-size-fits-all manner, for instance offering mortgages to customers in their 20s and wedding loans to those in their 30s, regardless of individual needs. The reality in 2025 is that the personal and financial circumstances of the average customer have become increasingly varied. This requires a more personalised and nuanced approach. For example, the proportion of 25 to 34-year-olds living with their parents has increased by more than one-third since 2006, meaning more customers may lack the financial means to afford a mortgage, or wedding. Banks therefore need to adjust their communications strategy to offer products that are beneficial for their individual circumstances.
A product-first, customer-second approach is no longer sustainable. To ensure customers are with them for the long haul, banks must prioritise providing meaningful, personalised advice, rather than chasing short-term sales. This shift demands a complete rethink of how financial institutions segment their customer base and tailor their messaging.
Instead of relying on outdated, generalised marketing tactics, banks will leverage data analytics to adopt a truly customer-centric strategy. By offering personalised insights, such as actionable tips on reducing recurring expenses from commonly used platforms, banks can demonstrate real value in everyday financial management. This could include alerting a customer to potential savings on subscriptions or spending patterns that can deepen engagement and trust.
Abandoning the ‘one-size-fits-all’ segmentation model will enhance customer satisfaction and build long-term loyalty. Additionally, positive word-of-mouth, which drives decisions for more than one in four consumers when selecting financial products, will fuel organic growth and strengthen the bank’s competitive edge.
From boring to bold: banking’s new look
This need for continuous engagement signals a broader shift in banking communication. With the immediacy of online shopping sites and social media platforms like Tik Tok and Instagram shortening public attention spans, consumers now want information in as few words, as quickly and engagingly as possible. Banks are now playing communications catch up with industries such as retail, where players such as Intermarche doubled their click rate by adding interactive features such as GIFs, videos and images to its customer communications. In 2025, banks will capture the attention spans of consumers in their own way, using more eye-catching methods to share critical information such as mortgages or interest rate changes.
Like interactive news alerts on a customers’ smartphone, banks will feed information through rich communication services (RCS), which incorporate hi-res imagery and interactive features into messages that prioritise readability. The use of RCS features will now be a mainstay among the nearly 20 apps now on the average customer’s phone. As organisations all compete for the eyeballs of customers, not leveraging RCS will put businesses at a competitive disadvantage.
However, if not implemented effectively, RCS could hinder the customer experience for banks. With operating system providers like Apple and Google typically releasing new software versions annually, banks will need to incorporate with the latest features into their offering, or risk being overlooked by more demanding consumers. Additionally, banks that use RCS to engage customers at the start will have raised customer experience expectations throughout their journey. Banks must ensure the end-to-end customer experience remains consistently engaging so that trust, loyalty, and long-term customer satisfaction are fostered, ultimately driving sustainable growth and competitive differentiation.
Drivers for Banking Growth
Money matters, and consumers increasingly prefer to bank with institutions that demonstrate a genuine commitment to their financial well-being. As banks and financial institutions continue to enjoy the highest profit margins of any industry, the moment has come to shift priorities toward consumer-centric strategies rather than a relentless focus on profit maximisation.
Customer growth remains a vital component of banking success, but today’s well-informed consumers are more discerning. They are drawn to banks that prioritise transparency, meaningful engagement, and trust. Institutions that fail to meet the evolving demands of 2025 risk being left behind by competitors better aligned with customer expectations and values.
