I recently wrote about the process gap in the mortgage industry, particularly between sales and marketing. While this is a gap that exists in other industries too, it is very acute in the mortgage market, where many mortgage organizations have put their technology dollars to work to optimize the post application process, often in response to growing regulation concerns. This, unfortunately, has led to some neglect in the area of sales and marketing, two areas where even small adjustments can have a big impact on the bottom line.
In this post, I am going to go a bit deeper into this problem, following a mortgage lead from initial interest in the mortgage marketing pipeline, through to the handoff that occurs to the loan officer.
Making the Most of your Mortgage Marketing Spend
Mortgage organizations are spending vast amounts of marketing dollars to build consumer trust in their brand and generate business for loan officers. But what happens when a prospect suddenly raises his or her hand in interest?
Typically, when a lead comes in through a lender’s marketing efforts there is a rocky handoff to the loan officer. A few issues often occur, the lead may not be automatically assigned to a loan officer, and if it is assigned, it may sit for hours or even a days in the loan officer’s queue. Worse, it may fall through the cracks completely, never reaching a loan officer or getting lost in a long list of other active opportunities. In fact, our research shows that on average, it takes a loan officer 6.4 days to call back a new mortgage lead, and what’s worse, 44 percent of those new mortgage leads never receive an initial call.
According to another study, the Ultimate Contact Strategy, this is not nearly enough effort—in fact, our research shows that calling a new lead within two minutes increases conversion rates by as much as 160%. Additionally, around six “touches” has been proven ideal, yet most mortgage lenders give up after just one or two calls.
Mortgage organizations that haven’t created a lead policy and contact strategy to ensure high-quality leads are worked in an optimal way are literally throwing money away.
Creating an Effective Contact Strategy for Mortgage Leads
Mortgage call centers have done this for years and turned it into a fine science. They have strategies to cultivate Internet leads and they’ve hired hundreds of people to make hundreds of calls per day. It’s a very tightly monitored process, and it’s been proven to get results. The call center lenders have also proven that, when a lead comes in, seconds count. It’s critical to have automation in place to ensure leads (at least your high priority or currently active leads) are called back within seconds or minutes.
However, the sales reps in these call centers comprise only about 5 percent of the entire loan officer population. The question then becomes, why couldn’t a retail loan officer, begin using similar technology to get the same result?
Put It Together with Mortgage Marketing and Sales Technology
The typical loan officer may not need to make 100 calls a day, or even want to. However, given the affordability of technology it makes sense for all lenders, regardless of size or type, to arm themselves with the same technology that mortgage call centers are using. Technology can ensure that a lenders ideal sales process and contact strategy is executed diligently and consistently across the organization. This helps ensure the gap between marketing and sales stays closed.
While technology may seem like a no brainer, it does come with one major challenge, user adoption. Many loan officers are concerned that any new software is just a “black box” designed to help someone micromanage what they do. The key to adoption is transparency into the “why.”
Think about solutions like Waze or Uber, two popular apps used by consumers. The transparency these apps offer increases consumer confidence and drives adoption. In the same way, if mortgage marketers and loan officers have transparency into the “why” and also see the technology as a tool to do more business, they’re in.
And technology truly does enable loan officers to do more business, one of the ways it does this is by creating more efficiency for loan officers by automating routine tasks. For example, taking something like creating a loan file down from several hours of time populating fields manually to a few seconds, or as long as it takes you to click your mouse. That mouse click generates an error-free file that is auto-filled based on data already available in the loan origination system, such as Encompass.
The more dominant purchase market gives the advantage to lenders who embrace technology. In the purchase environment, the lead to application time can be six months or more, there are tons of opportunities for mortgage leads to fall through the cracks. This is going to be particularly true in 2016, when the sales cycle is expected to be longer because of compliance hurdles. We now have a situation in which the gap between marketing and sales is getting longer, and without some sort of technology to bridge it, lenders will continue to lose opportunities.
When all is said and done, every lender and every mortgage professional wants to maximize lead conversion rates. The only way to do this is to identify your own marketing and sales gaps, creating a process for overcoming them, and then ensure that process is followed. Once you accomplish these three things, you will no longer need to mind the gap. The gap will simply disappear.About the author: Chris Backe is the director of financial services at Velocify, and a sales automation expert with more than 20 years of experience offering technology solutions to multiple industries. Chris has spent the last 10 years in the financial services industry, holding various positions at industry leading technology companies including Ellie Mae and Salesforce. He can be reached at firstname.lastname@example.org.