Getting personal with a customer relationship management programEric J. ChristopherCRM, customer relationship management, increasing business and referrals You may have heard the term "Customer Relationship Management" (CRM) in the late 1990s during the dot-com craze. But CRM is as much a sales philosophy as it is a dot-com buzzword or software topic. What is CRM? It's a fancy way to define how efficiently and effectively you interact with your clients in order to increase business and referrals. In the mortgage industry, CRM will prove to be a necessity for individuals and companies that have aspirations to prosper like they did during the refinance boom of the last few years. We all know that market changes have taken the easy money out of the industry. The refinance "order taking" days are gone and more of your loans will need to be engineered with creative, efficient selling tactics. You will not only need to work harder, but also smarter. Implementing a strong CRM program is the first step toward working smarter. Lead Management The good news for individual originators and small broker shops is that a solid CRM program does not have to be complicated or expensive. CRM is multi-faceted, but to keep it simple, we will focus on lead management and the cycles between lead acquisition, funded loan and repeat sales. The tighter you make the system between these three events, the higher your level of prosperity. It's that simple. Where to Start The first step in your CRM process is to start using contact management/CRM software to manage all of your prospect and client activity. Import all of your past clients and prospects into the database and classify them into three to five similar groups (i.e. past clients, warm prospects, cold prospects). In addition to the basic organizational benefit of a contact management application, there is also huge value in every bit of prospect and client data you gather along your journey. With client data organized efficiently, the next step is to create action plans for the three to five groups you classified. An action plan is nothing more than a consistent set of "touch points" or client interactions that you will implement with each group. The reason we do this at the lead acquisition stage is that there are only three dispositions with any prospect in any sales cycle. The response to your offering will be either yes, no or maybe. Since less than 10 percent of your initial contacts will be "yes" answers in the short run, a huge part of CRM is to focus on harvesting the "no" and "maybe" prospects. A solid action plan will anchor you to a good percentage of these prospects and many will end up as clients. Specific action plans will allow you to use the information that you have gathered and to focus time on the prospects closest to the pay line, while simultaneously growing and harvesting the lesser prospects into future sales. Designing Your Action Plan Action plans are highly creative and there are no rules about what you can use as an effective touch point. Real estate agents are wildly creative with their touch points. How many branded note pads, free garage sale signs or Halloween pumpkins have you seen delivered to homeowners over the years? As silly as some of these seem, they are all touch points. Whatever touch points you enlist, always keep in mind that the goal is to leverage your time to the greatest degree while still being on the mind of as many past clients and prospects as possible. Spice up your touch points by using personalized data you have gathered in your contact management system. Over time, if you're observant, you will learn which individuals are the seasoned homeowners, those who will become empty nesters soon, and prospective business owners needing venture capital. Listen for who is retiring, getting divorced and who has had a death in the family. To be even fancier, learn their birthdays, anniversaries and favorite sports teams. Your software will keep this data ready for you to load into your discussions and correspondence. As an easy example, part of your action plan may be to send a birthday card to your clients. An Action Plan Case Study You receive a referral from a previous client. At initial contact, the referral is relatively indifferent to your ideas. Even though there seems to be a need for the prospect to tap into some of their home equity, you notice no excitement or buying signals and you wonder why they agreed to meet with you at all. The essence of your CRM program is to seed, grow and harvest these types of prospects when other originators would have given up. Your action plan will lay out an entire event chain to keep the prospect thinking about you over time. Notice that most of the activities are automated and require little of your time, yet the personalized nature of these items will appear as though they were written on an individual basis. You may be sending out 100 personalized e-mails at one time! After the initial meeting, the sequence will probably look like this: *The Day After Initial Meeting: Send a form letter with your offer and business card. *Three to Five Days After: Send a follow-up e-mail. *Seven to 10 Days After: Make a follow-up phone call to gain additional information, check for buying signals, time frames, etc. *Sixty to 90 Days After: Place another follow-up phone call. *Four to Five Months After: Send your newsletter. *Send cards on annual events such as birthdays or at Christmas. Obviously, not every prospect will fund a loan, but how many times have you closed a loan with a prospect who initially showed a low level of interest? CRM will turn every scenario into a system. Invent other action plans for warmer prospects and past clients. Advantages From the single-user standpoint, time leverage is the essence of sales success. A CRM program will provide that leverage and automatically warm prospects up to the point of sale. Small broker shops are always tasked with retaining good producers. A management-backed CRM program and leads to feed that program are excellent ways to show key producers you are willing to invest in them for the long term. How to Implement a CRM Program While we have only skimmed the surface of the CRM ocean, the key is to start implementing a system today! Take the initial step forward and then build upon it. There are companies such as XL Marketing that have packages geared toward single originators and broker shops with fewer than 10 producing originators. However, no matter the size of the application, CRM success requires a commitment from the individuals who are actually prospecting and closing sales. Eric J. Christopher is a managing partner of Huntington Beach Calif.-based XL Marketing. He can be reached at (877) 842-7300 or e-mail [email protected].
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