PERSON OF THE WEEK: How can mortgage lenders improve their marketing strategies to better market to borrowers? To find out, MortgageOrb recently interviewed Kieran Mital, marketing analyst for Tavant Technologies.
Q: What are some of the obstacles that impair adoption of marketing techniques across lending channels?
Kieran: A big obstacle for mortgage lenders is narrowing down your target market and determining where to invest limited time and resources. Engaging with existing customers and building a foundation is vital to maintaining a healthy business. However, attracting new customers is just as important in terms of expanding market reach and ensuring future growth.
Identifying a target market and determining which borrowers to lend to is crucial to ensuring future success. Once a lender defines its target market, it is much easier to determine which marketing techniques will be most effective, as well as identify any possible niche segments that may require a different approach.
An example is direct communication. To cultivate a loyal customer base, it is important to provide existing customers with direct communication that is personalized and engaging. Ask questions to better understand each borrower’s unique situation. This knowledge enables loan officers to better serve that customer and build trust.
Additionally, lending institutions struggle with maintaining customer relationships, and content marketing is one of the primary solutions and channels that marketers can utilize to improve these relationships. Content should first and foremost inform customers, and informational content should be a primary tool as a marketing channel for lenders to update and inform customers about their products.
Another channel, pay per click, is a direct marketing strategy that should be used no matter what the objective is. Unfortunately, pay per click is not utilized enough. When a lender trying to build brands, it needs to have a strong presence online that comes from content and comes from pay per click.
People spend a lot of time on the internet and use search engines every single day regardless of age or profession. The challenge is, it’s a marketing strategy that can feel impersonal or unnecessary. Regardless of whether a lender is trying to market to new or old customers – or whether it is a new or older lending institution – pay per click is vital.
One final obstacle that makes it difficult, as far as adoption, is deciding which legacy systems and which newer digital systems to use to optimize your outreach to existing customers, and then subsequently to getting new customers. It’s difficult to tell whether it’s more useful to be using newer digital marketing channels, such as pay per click, SEO, SEM, or using older, more legacy marketing channels, like email campaigns and sending direct mail that can be beneficial in terms of building your brand in a community.
Q: In order to fully realize the opportunity that marketing and selling online has, where should lenders start?
Kieran: In order to fully realize the opportunity that marketing and selling online has, a lender must start by asking two questions: Where do you feel like you’re going to be building the most revenue from loan volume and where does that increase in loan volume come from? If an increase in loan volume comes from leveraging existing relationships, then that’s exactly what marketing needs to know in order to begin picking which channels to target. If a lender is increasing loan revenue from building on existing relationships, and leveraging those to gain more loans, then it is going to want to use more traditional lending channels. Does using more in-person marketing strategies, like having a larger presence at lending conferences and events and building brand recognition, less through digital places and more through face-to-face methods, increase revenue? If a lender decides that the future is for the lending institution to get more borrowers to join its customer base, and that’s the way it wants to increase loan volume and revenue, then marketing can determine what lending channels are best to use to accomplish that objective.
Q: Does branded marketing and thought leadership matter? Or should lenders focus on generating leads from marketing activities?
Kieran: Oftentimes, it makes sense for marketing to play less of an active role in developing brands and acting more as sales enablement – because at the end of the day, generating leads, getting more customers and building relationships, is what makes the company money. If a lender wants to build a foundation for the future and increase loan volume by building more loyal wallet borrowers, then branded marketing is the way to go. A lot of value comes from honing in on branded marketing. Thought leadership is also a major means of building a brand that customers and borrowers understand to be trustworthy, technologically advanced, and even customer centric.
Thus, branded marketing and thought leadership absolutely matter. It’s how a lender builds a foundation for the company and the brand. When talking about generating leads, and doing branded marketing as one or the other, they’re necessarily mutually exclusive. A lender can do both – and can succeed doing both.
Q: Which marketing channels should lenders focus on to gain the most traction?
Kieran: Lenders should focus on the channels that make sense for their overall marketing objectives. Therefore, it’s important to begin by defining what the objective is. Once as a lender done that, it can choose the channel that makes the most sense to accomplish that objective, whether it’s leveraging and increasing brand awareness, marketing to existing customers, or conducting outreach to gain new customers and new borrowers in order to build long term relationships.
Whatever the objectives are, once they are defined, a lender must choose the channels that make the most sense. Sometimes that means focusing on more digital marketing channels and sometimes that means focusing on more direct marketing channels. Content, email, and mail marketing as well as pay per click are all marketing channels that lenders have access to and should be using, but it all comes down to focusing on the right ones.
Q: How should lenders measure the success of their marketing activities?
Kieran: In order to grow their business, lenders first need to define what that measure of success is within their own business for that to happen. Once that is defined, then a lender can formulate marketing strategy and allocate marketing budget accordingly to be able to accomplish what the overall objective is.
The industry standard across all businesses should be that one can measure the success of one’s marketing efforts in a spreadsheet. Marketing strategies should always be measured, and data is the fuel that drives any engine that measures success. It is how one breaks down what one does as a marketing unit, to ascertain whether or not, on an incremental level, something is defined as a success or a failure. Fortunately, failure and success can coexist simultaneously in marketing. For example, a marketing campaign that initially seemed like a failure can be turned around into incremental successes that a lender can learn from, thus helping the lender develop new strategies and techniques.