• by Cory Treffiletti , Featured Contributor, September 7, 2022

There is a massive change taking place throughout the landscape of digital media and you may not be thinking about it in the same way I am. Let me explain.

I’ve spent my career in three distinct chunks.

The first chunk was building the framework for digital media and advertising across brands of all shapes and sizes.  That encompassed agency work, industry work and strategic work.

The second chunk was around data, AI and measurement and the ability for brands to not only reach an audience but engage them and measure the outcomes.  That was around DMPs, DSPs, user-generated content and social amplification.

The third chunk has been around different ways to extend engagement and help brands find new ways to work with customers and craft experiences that lead to a more fruitful, and loyal, relationship.  This has included AI technology and now fintech.

My most recent foray into fintech is probably the most fascinating area for me.  It is an area which is disrupting the landscape in a subtle way and can have a profound impact on the way consumers engage with their favorite brands.

The concept of “embedded finance” is gaining more and more steam, but the experience has been around for some time. 

Embedded finance is the action of enabling brands to offer financial services that were previously only available in a bank environment.  Apple, Google, and Facebook dove into this space, and so have brands like Uber and Shopify.

In both B2C and B2B environments, brands that know a little about their customers can offer up different solutions that further cement the relationship and make those customers more dependent on the brand they work with.

Embedded finance is typically led by embedded payments and is fast followed with other services. 

Google offers payment solutions, but they also offer personal loans to select customers.  Facebook created a cryptocurrency, and it also offers small business loans to qualified companies who are on their platform.  Uber has payments enabled in the app, but they also have pre-paid cards and other financial solutions for their drivers.  Shopify enables SMB merchants to have an online store and sell their wares, and they also offer data, marketing, and account services to their merchants so all your financial efforts can be included in one location. 

Embedded finance is important because it creates more tentacles for a brand to weave into your life, and consumers like and trust the brands they use every day.  This becomes exponentially more important when you factor in that brands are seeing declining revenues from advertising, so they need to find new ways to monetize their audiences.

If you pull on this thread, you can start to see how the brands you least think of being associated with financial solutions could become more entrenched because of embedded finance.

Apple always comes to mind.  Why can’t Apple be your primary front-end “bank” – underwritten and white-labeled, of course – by a primary financial institution?

What’s to stop Microsoft from doing the same thing and extending their investment arms into the SMB space through an established VC fund that is comprised of small business loans with favorable repayment terms?

Why can’t a lifestyle brand like Nike create loans to athletes who are on the radar nationally, especially now that college athletes are being paid for their likenesses?

What about Yeti becoming a brand that offers travel insurance to get its customers out on the open roads again?

Why couldn’t Patagonia offer the same thing, possibly even giving loans to people using BNPL (buy now pay later) to help finance global travel for qualified customers?

Why couldn’t the New York Yankees simply become a bank?

Why couldn’t the Apollo Theatre give small business loans to local businesses and help drive growth in their local community?

All these financial services can be underwritten by banks or other financial institutions and enable the brand to double down on extending its name into new areas.  These new areas drive growth and loyalty with their customer base.  They also create new revenue streams, potentially making them less dependent on ad revenue, subscription revenue, and more.  You can start to see how embedded financial solutions which are based off the initial customer relationship helps create deeper ties with your favorite brands.

This is a burgeoning area of growth for brands and will potentially have a profound impact on the media landscape for years to come because it diversifies the revenue-driving capabilities of these companies and creates new forms of customer engagement.

What types of examples do you see, or can you think of for how brands could leverage these ideas for growth?  Share them in the comments section and let’s see if anyone jumps on your ideas.