Taking CPG Brands to the Bank: Financial Media Networks and the Reinvention of Cash Back Rewards 

As the digital media and ad tech landscape continues to evolve and progress, a new kind of ad network called a Financial Media Network (FMN), built by – ya, you guessed it – financial institutions (FI’s) are emerging as an alternative to Retail Media Networks (RMN). This newfound FMN channel represents untapped marketing opportunities for consumer package goods manufacturing (CPG) brands increasingly relying on retailer-owned RMNs, their first-party (1P) data, and their digital ecosystems. 

Retail media networks have surged in popularity as major retailers like Walmart, Amazon, and Target have developed advanced advertising solutions leveraging their vast shopper purchase data, allowing CPG brands to reach in-market shoppers at the moment of purchase. This has been a boon for these margin-constrained businesses constantly searching for innovative ways to garner new revenue streams and shopper marketing opportunities funded by their CPG vendors.

In digital, money follows performance, and retail media is living proof:

Retail Media’s spend is estimated to be $140 billion, with an annual growth rate of 21.8%.

Emarketer

Keeping a keen eye on the growth in retail media networks, US consumer banks are rethinking how to monetize their own rich digital assets and customer data. This comes when regulatory pressure is real and competitive threats are chipping away at bank’s profit margins. In response, FI’s are launching their own advertising networks and reinventing legacy products that connect consumer banking customers with money-saving cash-back rewards from retailers and CPGs.

FMNs are being touted as the banking world’s equivalent of RMNs but besting RMNs in a few key areas. Live examples of FMNs include Chase Media Solutions launched in April, PayPal, and even bank’s long-standing cash-back rewards like Bank of America’s BankAmeriDeals are falling under the FMN umbrella. In AdTech it’s the new new thing:

FMN Ad Spend To Quadruple In Next Two Years

RMNs vs FMNs: What’s the Difference? 

The difference is in the data: Banks have a broader view of shopper habits. They see consumer purchase behaviors in more places across more stores, more categories, and in more industries. FMNs also see money flowing in and out of consumer’s accounts, paychecks, loans – everything. Retailer data, however, is restricted to what happens within their own four walls. Also, with demand outstripping supply on most RMNs, CPG advertisers now have an alternative outlet for high-quality offsite reach from an ad network of highly trusted publishers – who’s more trustworthy than your bank?

FNM’s and a New Twist on Cashback Rewards 

Banners on bank home pages? Not exactly. FMN programs are a natural innovation of existing cardholder benefits. You see, digitally engaged banking customers are not just checking their balances – they’re browsing their cashback rewards programs that feature money-saving deals. These programs have been around for years and were initially introduced by the banks to help drive credit/debit card usage with offers from brick-and-mortar and online retailers like Gap, Panera Bread, and Ross Simons. 

So, what’s new? Well, until very recently, these programs have struggled with one significant limitation – all the rewards are funded exclusively by the merchant, never by a vendor brand or offered on individual products at the item level. Plus, these deals don’t include items in everyday spending categories consumers want, like grocery, primarily because up to now, banks haven’t been able to track item-level spending, limiting the type of available offers to a percentage off the entire basket. The net result is the same ho-hum offers on merchant-level discounts. No item-level deals equal no CPG brand funding equals no item-level rewards in major categories like grocery, health, and beauty.

Enter Item-level Cashback Rewards for FMNs 

Breathing new life into a well-traveled but kinda same old cash-back rewards experience, several US banks are now offering CPG brand-funded item-level rewards, which adds a whole new level of consumer value and engagement. It works like this: Banks like PNC and Bank of America promote Grocery Deals cash-back rewards. These offers are powered by companies that serve as a source of first-party data and have brand-funded items available for purchase at any retailer where the CPG advertiser’s products are sold. For example, Nestle’s DiGiorno brand currently offers a $2 reward on any frozen pizza on Bank of America’s BankAmeriDeals app. Depending on the rules of the promotion the shopper makes their purchase, and either snaps a picture of their receipt, scans a bar code, or simply checks out to receive their reward. 

Bank of America is witnessing the value of delivering grocery items to banking customers:

Every day spend items are key engagement drivers for our BankAmeriDeals program. Prior to our partnership with Snipp, grocery offers had been limited in availability to us. Even though we are still in early stages, and we are working to secure more CPG participation across a greater range of categories, engagement with the offers we do have has been high and we are looking forward to growing the program in the near future.

Melissa Rowland SVP of Bank of America

What’s Driving this Demand for Item-level Rewards? 

Several colliding factors are driving FMNs’ item-level cashback rewards programs into the spotlight, ranging from technological advancements to the current economic woes facing today’s consumers. 

• CPG brands are the US’s second-largest advertiser, estimated to spend $48.79 billion dollars in 2024 growing 15.5% annually. These dollars are driving the growth of RMNs to their granular targeting capabilities at the merchant level. However, FMNs enable brands to leverage shopper marketing dollars with more holistic data and expanded reach outside of a retailer’s walled garden to target competitive retailer’s shoppers and national dollars to cover a broader audience across the bank’s national footprints. 
• American consumers are facing escalating food costs. The average American household spends more than $1000 per month on groceries, according to the US Census Bureau’s Household Pulse survey – that number varies depending on geography and the number of children in the home – families with kids spend 41% more on groceries than those without. In 2022, food-at-home prices increased by 11.4%, adding to consumer frustration about rising costs. Bottom line: Consumers want new ways to save on everyday spending items like groceries and drugs. Coupon redemption is on the rise increasing 10.4% from 2022 to 2023, this is the first increase since the financial meltdown of 2008. 
• Banks want top-of-wallet status. Credit and debit card issuing banks collect and analyze vast amounts of consumer spending data, including dollars spent by shopping category and when and how frequently they shop. Also, they recognize that if their customers regularly use their credit cards in major spending categories like grocery, they have a stronger chance of capturing a larger share of their overall spending. For banks, top-of-wallet use of credit cards equates to higher customer loyalty and retention. In efforts to save money, grocery shoppers are shopping around. According to data company Dunnhumby, 40% of consumers surveyed shop multiple grocery stores to find the lowest prices – up 9% yearly. Advertisers on FMNs can target shoppers based on a wider view of consumer spending across multiple retailers, by store and category, compared to RMNs’ view of purchases, which are limited purchases made only at specific retailers. 
• Banks have trusted high digital engagement. Digital engagement at banks has come a long way since the days of free toasters. According to the American Bankers Association, 97% of consumers rate their bank’s online and mobile app experience as excellent, very good, or good as reported in a recent survey. Does Banking Association saying bank apps are awesome sound slightly suspect? Well, the engagement numbers tell the rest of the story. According to SimilarWeb, bank digital engagement is strong, Chase leads the way with 44.62 million monthly unique visitors in May of 23, Capital One 37.2 million and Bank of America 26.4 million round out the top three. Additionally, 81% of consumers used a mobile device to manage their bank account at least once in the previous month, and 59% did so more than three times. The ABA data also indicated that U.S. adults trust banks more than any other entity to keep their information secure and private. 

The Opportunity for CPG’s

For CPG advertisers, FMNs and their cashback rewards siblings represent a significant opportunity in digital marketing, combining high consumer engagement on trusted digital platforms with precise targeting capabilities. Participating CPGs are finding a new way to reach incremental, high-value consumers outside of restrictive RMNs and shoppers that aren’t the typical extreme couponers, instead driving sales with regular folk who want to save money on everyday purchases. Compared to third-party savings apps like Ibotta and Fetch, consumer bank’s audiences are in the 100’s of millions, representing a larger swath of a CPG brand’s addressable market. 

Financial Media Networks are emerging as the new media channel that CPG marketers can leverage to reach millions of banking customers across the U.S. With the ability to deliver personalized, easily redeemed, item-level cash-back rewards on everyday purchases like groceries, FMNs offer a compelling value proposition for both consumers and brands. Unlike traditional retail media, FMNs benefit from consumers’ high engagement and trust in their banking platforms, coupled with a broader view of consumer spending behavior across multiple retailers. As FMNs gain traction, they represent an innovative way for CPG advertisers to connect with high-value, savings-minded consumers that they (forgive the bad pun) can bank on.