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Cash-out refi share falls modestly in Q4 '04

National Mortgage Professional
Jun 05, 2005

Building a Marketing Plan Utilizing Advanced TechnologyAeron StedmannInternet, online, e-commerce, web-based originations, lending technology We are in the midst of momentous opportunity and change in perhaps the fastest moving revolution to reach virtually every part of the globe. The revolution and opportunity created by the Internet and E-commerce calls for a unique, strategic, and well-focused marketing business plan in order to compete in the mortgage market, both locally and globally. With increasing competition and access to information, consumers are able to explore and invest with companies at the touch of a keyboard or click of a mouse. What this means for you as a business person is that you will have to carefully plan and design your approach to avoid getting caught in the many pitfalls and traps that exist in the new virtual marketplace. This article will attempt to provide you with a concrete marketing plan to guide your business successfully into a technology-driven, moneymaking machine. Deciding Where to Start There are several things to keep in mind from the start and throughout the Internet business planning process. First, the needs of the online consumer are different. Consumers are becoming more adept at locating information and making informed choices regarding their purchases. They are also looking for solutions that are convenient and offer the lowest prices. To be successful, you must orient your services so that the consumer receives efficient service and competitive prices to ensure future and potential business. You will also want to incorporate benchmarks and evaluation tools from the beginning to remain on track and headed in the right direction. One of the toughest parts of designing a business plan is deciding where to start. This is especially true when the marketplace is constantly changing, and when careful planning is essential to keep marketing cost-effective. For example, new technology and investment opportunities such as palmtops, IPO money, automated marketing solutions, search engines, and E-partnerships all make for a complicated scenario. So, assessing and determining the starting point for the business plan itself is the crucial first step. The most logical way to approach the assessment process is to start with the fundamental goals. Then, collaborate with your business partners and consultants to bring in the skills and understanding on how to get there. This involves a thorough analysis of the capabilities of the technology, personnel, and market that you chose. Many times, people are unaware of the full capabilities of technology such as newer javascript or other interactive features that will make your Web site stand out above the rest. Cost-Effective Marketing Performing an analysis of the origination of your clients will assist you in determining the most cost-effective means to increase business, and will also assist you in accurate budget planning. For instance, what percentage of your business is procured through referrals from networking, real estate agents or CPA's? What percentage is repeat business or referrals from previous clients, and how much of your business is drawn in from advertising or telemarketing? A good suggestion is to assign codes in your database so that this information will be easily retrieved to assist your future planning. Increasing your ability to be cost-effective first involves determining your actual costs. This is the point where you want to do an assessment of the previous year's clients. Investigate where they came from and how much you spent on each type of marketing, such as direct mail, telemarketing, or other active marketing programs. Then, figure your costs for each, and calculate how many loans you actually closed for clients who were acquired via each of those means. That is your customer acquisition cost for those segments of your business. Now, figure what your acquisition cost was for clients who came to you as repeat customers or from referrals. You may find that you spent more time getting a new customer than, for instance, getting a customer you obtained through a referral. Given these figures and your income goals, where does it make the most sense to invest your energy and marketing dollars to increase your business? This is an important step in the business plan, especially when you consider that now there are many more opportunities for marketing, generating leads, and closing deals that may prove to be as or more cost-effective than these traditional methods. Interactivity and Access to Information E-commerce and interactive technology provide tremendous opportunities for the mortgage business planner. Imagine recruiting 25 loan agents in a week using net branching as a model, and then having a loan agent in the field equipped with a palmtop or laptop with a complete 1003, DO/DU, and LP credit reporting system. Then, suppose the customer is able to sign documents online using digital signatures. You may never end up sending another loan package or tracking down the customer in order to close the deal. In addition to the connections and marketing capabilities of the Internet, wireless communication, and other technology that has expedited and improved marketing capabilities, there are other marketing solutions that utilize automated telemarketing to create niche markets, affinity groups, or referral sources. Other marketing possibilities involve having the loan agent interface with the client online. This is feasible by utilizing your Web site as a storefront, and by using processing software behind the 1003, a mini application in front of that, and access to credit reports online or through your Web page, with the capability to send it directly to Freddie Mac or Fannie Mae. Co-Marketing Online One company that combines these technologies into a comprehensive easy-to-use system is, which locates lenders for loans. We have many clients using the system who find this to be an easy lender solution. It saves the broker time, and helps them boost their productivity through: * A search engine that instantly matches the right loan to their customers * Searching through real-time rates for more than 50,000 loan programs * Giving the broker information on more than 50,000 loan programs by displaying the underwriting guidelines for all programs at the time of search LoanCity enables the broker to be more efficient because it is a one-stop shop for loan selection, matching, underwriting, docs, and funding. The broker can get access to virtually the entire mortgage marketplace, but is also able to focus on doing business electronically. LoanCity coordinates the technology, so that the brokers can choose to do business in a method that is either all electronic or traditional. Efficient Automated Marketing There are new automated marketing solutions that provide leads and generate marketing automatically. For instance, a 24-line GoldSprint automated voice mail broadcasting system will call 200,000 individuals per month, directing them to your loan agents at a 0.5 percent response rate, or to your Web solution with a three to five percent average response rate. You can also use the same system for business-to-business marketing to market business partnerships. In addition, you can add an interface that aids your Web site solution for business-to-business marketing and for recruiting E-partnerships. Data mining is also facilitated with the collaboration of other company's databases while also co-marketing and creating mutual benefits between customer bases. Furthermore, there are different laws regarding E-commerce and electronic transfer fees that allow you to give income to the referring E-partnerships. Summary Successful Internet and advanced technology marketing can be accomplished with hard work and close attention to detail. It is important to keep up to date on not only the technology but also the degree to which the technology is generating the leads and deals that facilitate increased business. While marketing is still based on the same principles it was 10 years ago, the tools in your hands today are much more valuable. Aeron Stedmann is a nationally-known keynote speaker on technology, e-commerce, and marketing. He is the author of Database Marketing, and has developed automated telemarketing systems and unique e-commerce business solutions. He is currently vice president of marketing for Green Lizard LLC, a Napa Valley, Calif.-based Internet business. Mr. Stedmann may be reached at (707) 942-1469,, or e-mail [email protected]
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