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Diversify your products and people

National Mortgage Professional
Aug 08, 2006

Finding relationship sales treasure buried in the depths of customer dataCindy Heximertips and tools, customer retention, increasing database There are "intelligence treasures" buried within your customer data files. Chances are that you are not mining these fertile sources of profitable relationships sales and service opportunities. That treasure chest includes your data about payment histories, loan types, interest rates and origination dates. This data tells a story of future customer needs and the timing of those needs that smart lenders have learned to mine. Those who understand how to use those treasures productively have been able to increase their mortgage or home equity sales volume at approximately one-fifth the cost of a traditional campaign. They are able to move leads through to funding at a fraction of the time that they used to and are also able to reduce annual customer defections by up to 25 percent. The key is using the analytics as the basis for relationship selling. Lenders who excel at relationship selling profit do so because they learn to consistently meet their customers' needs over time. They use their data to understand what their customers want and when they want it, not to push products indiscriminately. Relationship selling is a way of doing business through conversations and relationship building. It's based upon information, knowledge and trust. This translates into powerful selling and long-term relationships with customers. The value of customer data involves not only developing additional sales opportunities, but also identifying the warning signs of impending customer defection. Competition within financial services is at an all-time high. Today's typical financial services customer uses 10 or more financial services from four different institutions, and only three of those services are with what these consumers consider their primary banks. You can prevent defections by actively "listening" to your data, because your data can tell you if and when your customers will be going elsewhere. It's a critical part of developing a customer-for-life approach. Lenders who are adept at engraining this philosophy throughout their organizations are more likely to excel at the following relationship measures. Minimizing defections Maintaining a positive open/close account ratio is a sign of a healthy sales and service culture, which is knowledgeable of its customer base and aligned with its needs. Stabilizing and growing market share Creating a healthy sales and service culture gives lenders the ability to maintain their portfolios while also acquiring new originations. Increasing cross-sell penetration per relationship Having a high-performing organization means striving for six or more services per customer relationship. By the way, this is 100 percent greater than the three services most lenders cultivate. Minimizing do-not-call requests Cultivating an environment in which your customers view you as a partner in their financial success is the sign of a healthy organization. The size of your do-not-call list is an indication of how your customers see you. If they give you the message that they don't want to hear from you, that's a serious problem. It tells you that your list is not being managed well. Lenders can live with 10 percent of the customers on their lists falling into the do-not-call category, but keep an eye on how your list is being managed if it starts to creep up beyond that. Identifying a customer's future needs or milestones Establishing a culture based on relationship selling means not only securing a sale today, but also planting a seed for a future sale. Our experience has taught us that a "no" response today does not mean "no forever." By probing behind the "no," you can gather valuable insight into a customer's future needs and prepare for them. And, by developing a systematic process to act on those future needs, you anticipate and respond to them before your competitors. The key is a robust sales technology platform that allows you to store and use that data from every customer contact you have. Improving direct response marketing results Developing tighter, more targeted selection screens for direct mail campaigns enhances response and sales conversion rates. Lenders should not be satisfied with the industrys traditional low response rates. They often come from broad, loosely defined selection criteria that result in home equity offers to renters, students and the elderly. In todays information-rich environment, such things should be unacceptable. Enhancing branch and call center efficiency Taking advantage of relationship selling and analytics allows branch and call center staff to be more successful. It helps them to effectively balance the demands of timely and accurate service with the need for enhanced sales and referrals. Here's the bottom line: Your data is only the beginning, not an end unto itself. Use it to enhance your retention, growth and acquisition possibilities, and you'll be able to mine the treasure that's buried in your customer data files. Cindy Heximer is vice president of business development and marketing for the relationship selling and analytics business unit of Fiserv Lending Solutions. She may be reached at (716) 564-4631 or e-mail cindy.heximer@fiserv.com.
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