Consumer Direct Marketing…Your Key to Mortgage Wealth
By Mike Baker
We all know that the quickest way between two points is a straight line. The same is true for the quickest way to achieve success and financial security in the mortgage origination business. If you create a direct, purposeful, and strategic be-line to the customer with a consistent consumer direct marketing program, you won't have to worry about changing markets because you'll always have customers.
The very foundation of your business should be intensely focused on consumer direct marketing for several reasons. First of all, there is no better place to be than close to the customer. He who is closest to the customer wins! This is the ultimate security, guarantee and insurance that you'll stay in business in any market. If you are approaching your business strategically, then you are probably tracking where your business is coming from and evaluating the results. In other words, you should know what percentage of your business is consumer direct verses referral sources such as Realtors, builders, CPAs and/or financial planners. Consumer direct marketing should be a very high percentage of your business.
Think about it, many of you are dealing with referral sources such as Realtors, builders, CPA's, financial planners, and attorneys. Yet those professionals have to master consumer direct marketing themselves because that's how they get their own business. Their success is determined by their ability to reach and keep customers. As a professional loan originator at the highest level, you should be looking at this in the same way. You can use these referral sources to maximize your marketing efforts by strategically partnering with them. Since they have non-competing services, you can team up for great results.
There are two types of consumer direct marketing. One is marketing directly to prospects and potential new customers while the other is marketing to your past customers. It is critical for you to be an expert at both if you want to achieve high volume loan production. Most loan officers are more focused on marketing to new prospects than they are on harvesting referrals and new business from past customers. Don't overlook marketing to past customers as this gives you an immediate competitive advantage. If you have a strong and consistent marketing campaign to past clients, you will elevate the number of referrals you receive on a consistent basis and it's much more cost effective. In addition, the borrowers not so focused on rates and fees because of the great job you did for them and the relationship you are developing with them through your database marketing and high-touch campaigns. In this article, I will give you some ideas and strategies for both types of consumer direct marketing.
Whether you are marketing to new customers or past customers, it's critical for you to ask these questions; How does the public view you? What image do you want to create? What kind of reputation do you have? If they know you and have heard of you, what do they think about you? What is their perception of you and your company? The answers to these questions are critical to your professional reputation and how far you will go in mortgage origination.
It's important that you have a plan of how you want your business to look and how you're going to separate yourself from the competition. Be aggressive and look for ways to go beyond what your competition is doing. There are many mainstream ideas that work such as some listed below. It's also very critical for you to be creative and think outside the box by doing things such as...give your borrowers a keychain for their house keys with your name on it at the closing table, have an annual theme party and invite all your past customers, give them something of value as well as interest to them with your name on it, to name a few.
In addition, your plan, or your mortgage business model should have some healthy balance of where your business is coming from to survive and thrive in changing times. Depending on your business strategies, you may want to consider these percentages. 50% from consumer direct, 10% Realtor, 10% Builder, 10% CPAs, 10% Financial Planners, 10% Other Professionals. Whatever percentages you choose for each source, make sure consumer direct is the highest percentile." If you evaluate most of the superstar producers today, you'll find that they have at least a 50% referral sources from directly from their customers.
You can consider specializing in specific consumer niches such as immigrants, first-time homebuyers, farm workers, baby boomers, etc.
As we have a tougher marketplace coming when interest rates go up, you'll guarantee your position in the marketplace by picking a few of these consumer direct marketing approaches and mastering them.
*Seminars: Doing home buying seminars is something that really changed my business. I specialized in first time homebuyers and had 50 to 100 people the first Tuesday evening of every month. You can hold these types of seminars with strategic partners such as title companies, escrow companies, pest control companies, financial planners, Realtors and others. Seminars are a great way to separate yourself and give you a major competitive advantage in your marketplace because most people fear public speaking. If you can deliver solid content that adds value, you'll be viewed as an expert in your marketplace and the loans will come pouring in. I know this because that exactly what happened to me.
*Radio ads and interviews: In addition to using the seminar strategy, I used to do radio interviews. I know that radio ads work for many originators, but I've never paid for a radio ad in my life. I was able to get on a local radio talk show once per quarter to talk about mortgage financing. I received at least 150 phone calls immediately following the talk show within one week of the call every time I did it. Start making calls to radio stations to let them know that you're available. This can have a huge return.
*Local TV Stations/Cable: Like radio, your local TV station and cable stations are also effective. If you can position yourself as a mortgage expert and add value to their viewers, they'll interview you and/or let you participate. They are trying to add value to their viewers so they are always looking for topics of interest to the public.
*Targeting Apartments/Renters: Send specific mailers to apartments and renters. Make sure the mailer shows the renters specifics about qualifying for a mortgage, rent vs. own financial comparisons, tax advantages, and other valuable information about owning vs. renting. Before you spend too much money on sending thousands of mail pieces out, test out everything you do. Send 200 to 500 to a specific apartment complex first and test the results. In addition to having the right apartment complex, the right location, the right customer profile, and the right mailer, it's important to target specific customers groups. You may find that one mailer works better than another. Once you find what works and you're getting a great return, then expand to several apartment complexes and start closing lots of loans.
*For Sales By Owners: This group of customers is a no-brainer. I used to call 5 FSBO's and offer the owner a package to give to every prospect that came through their home. This was very effective. My package included, loan comparison reports, a do-it-yourself pre-qualification form, tips on moving, home buyer seminar announcements, along with my contact information on piece in the kit.
*Advertising: There are several forms of advertising yourself and your business. Bus benches, billboards, shopping carts, magazines, newspapers, and other publications. You will get a better return on investment (ROI) if you are strategic with your approach to advertising. For example; advertise in things like Real Estate publications and publications through your local chamber of commerce are a direct link to customers who will use your mortgage services. When people move into your city, you want them to know who you are. If you advertise on billboards, shopping carts and bus benches, this will promote your brand, but does not usually have a direct impact on getting you another loan today. Keep this in mind because you could go broke promoting your ego.
*Direct Mail: This is very effective as a marketing campaign. Sending colored post cards with strategic information that helps customers get to know you as well as gives them some value with the information on the cards if very effective. Caution: Don't just send out one mailing. For direct mail to work, you must be consistent with sending these out on a regular basis. They work well for both new and past customers.
*Home shows: Get involved with home shows that are compatible to the types of loan programs you specialize in. Invest in a booth and display it at home shows. You will also want to position yourself to speak at breakout, educational sessions at these events. You will maximize the value, ROI and exposure you have at these events by speaking. More people will stop by your booth if they view you as an expert, not just a vendor selling something.
*Free reports: Offer free reports to the public that help them with home buying information and financing. I used reports such as, "How to improve your credit scores," "A Report About Points…what are they, how do they work, should I pay points, etc.," "What is APR," "How to maximize your Home Buying Dollar." These reports can become very popular and get you known as an expert.
*Write articles for local publications: This was something I did all the time. I positioned myself as an expert and go-to person every time the local newspaper wanted to do a story or article on mortgages. This cost nothing and the returns are huge.
*Newsletters: The more strategic you are with newsletters, the more effective they will be for you. For example, if you truly know your customer, you can send one type of newsletter to everyone in your database who likes to golf. That newsletter should talk about golfing. Send a different newsletter to everyone in your database who's interested in cooking or gardening and the like. You get the idea. Make sure all of your newsletters have specific interest to a targeted audience in addition to current mortgage loan information as well. If you do this correctly, you'll be surprise at how many referrals you get! You can also fax or email your newsletters at a much lower cost. In addition, faxing and/or emailing them may be more effective for you. It's critical that you always track and test this to see what is working best.
*Voice Broadcasting: If you haven't tried voice broadcasting yet, you're missing the boat. You can do one phone message and send it out to your entire past client database. You can also use voice broadcasting for new customer marketing as well. You can promote your seminars; tell about upcoming home buyer events, talk about interest rates and other messages that the public has interest in. Again, track your response rates and results.
*Past clients: Past clients are borrowers you've already done a loan for. Your previous customer base should be your most important target. Sales are a relationship business as opposed to a transactional business. Remember, you shouldn't be selling mortgage loans; you should be selling yourself and your expert advice. That is what people are looking for and is willing pay the most for. Your job really begins when the loan closes if you're serious about developing stronger bonds with your customers and getting referral business directly from the borrower. To do this most effectively, you will need a computerized contact management system and a presentation software application. Your contact management software can assist you in keeping track and record previous conversations so that you are always up-to-date. This is critical so that you can review relevant data that shows you care. All customers want to do business with knowledgeable, experienced professionals who really care about their needs. For example, if you know that a particular customer is interested in classic cars, your database information will remind you of this and you can start out the conversation with, "Are you working on any new classic car projects lately?" Remember, people like doing business with people they like, and people like doing business with people like them. Your contact database management system should do all of these tasks:
1. Group customers into categories
2. Let's you know important customer dates such as birthdays, anniversaries, etc.
3. An alarm system that alerts you when to call or send something to the customer
4. Record all previous conversations and relevant data
Because this topic is so broad, it's critical that you narrow the scope by mastering specific consumer direct marketing campaigns. You can't be all things to all people. If you evaluate all top mortgage producers today, you'll find that they all specialize in one or two areas. Some are experts at seminars while other are experts at direct mail campaigns or for-sale-by-owner campaigns. Some do more than one, but be careful not to spread yourself too thin trying to do them all. You must become a master at your specific business model when it comes to consumer direct marketing in order to be at the highest level. Remember, consumer direct marketing involves both reaching customers and keeping them. Don't overlook the "keeping them" as this is a huge source for building a solid business with referrals.
In conclusion, make sure that all of your marketing campaigns are strategic and targeted to specific audiences with key messages and niches. Know who you're marketing to so that you have specifically defined targets and always evaluate your results. Test your ideas and monitor to find our which works best. Always offer something of value to each customer to get maximum return. Use tools such as database management software, presentation tools, fax, phone, email and voice broadcasts. And finally, there is no better way to create credibility and social proof than testimonials and endorsements from past customers. You can put these testimonials in a binder, have them on the walls, have them in your reception area, on your web site, and in other places. You should also get letters and testimonials from your referral sources on how well you have handled their customers. This is the best way to build trust and respect into your reputation.
Mike Baker is CEO of The Mortgage Coach as well as an industry speaker and author of Mortgage Power and Loan Officer Recruiting. He can be reached at 800-499-2242 or visit his web site at www.mortgagecoach.com.
|
