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Mortgage Lenders and Direct Mail: A Successful and Rewarding Partnership

Michelle B. Peel
Mar 22, 2014

Direct mail is one of most viable marketing channels available, according to the Direct Marketing Association (DMA). Direct mail continues to outperform electronic channels in acquiring new customers. In fact, statistics from the DMA comparing the performance of direct mail and electronic channels show consumers readily accept direct mail as a vehicle companies use to market their products and services. But most importantly, direct mail is measurable, and the return on investment (ROI) is strong.

Direct mail proves to be a successful and rewarding marketing tool for the mortgage industry. In fact, more and more mortgage lenders are returning to direct mail and taking advantage of its tangible, measurable and effective qualities.

Direct mail and the mortgage industry
According to market research firm Mintel Comperemedia, mortgage providers mailed nearly 1.8 billion pieces of mail in 2012. When comparing 2013 to 2012, there was a 40.5 percent increase in mortgage mail volume year-over-year. For 2013, mortgage-related direct mail offers totaled nearly 2.5 billion pieces of mail. The top mortgage acquisition mailers were Bank of America, Chase, Discover, Embrace Home Loans, and Quicken Loans.

Mintel Comperemedia identifies the following direct mail acquisition package trends from the mortgage industry:

►Sophisticated database and digital printing technology is allowing lenders to provide more relevant and timely mortgage offers.

Mortgage lenders are using calls to action that drive response to call centers or Web sites.

Marketers are using the Intelligent Mail barcode (IMb) to manage in-home dates and prepare call centers for increased call volumes in response to their offers.

Messaging is focused on building brand recognition and loyalty with themes that include urgency, offer flexibility and cost savings.

Lenders must take advantage of today’s sophisticated database and digital printing technology, which allows for more relevant and timely offers and integration with digital channels.

Recommendations to make your mortgage direct mail efforts more effective
If you’re looking for effective direct mail techniques to drive open and response rates, consider implementing these proven best practices to elevate the performance of your next mortgage direct mail campaign.

Open rates
Smart and creative design of your direct mail piece demands attention in the mailbox and increases open rates.

Avoid the typical envelope size: Select an alternative, non-traditional size envelope and avoid the typical #10 or 6x9 mailer. When your direct mail piece is different, it will easily get the attention of the recipient.

Keep it simple: A simply-designed outer envelope does not allow the recipient to make a decision about the mail piece without at least opening it first. A white envelope with a return address is more intriguing and “official” than a colorful envelope. Add a simple headline on the envelope that is personal and specific such as, “Information You Requested Regarding Your Mortgage Is Enclosed!”

Create a distinct feel: When the recipient notices that the direct mail piece has something inside, they are intrigued to open it. A heavy stock insert, plastic card or magnet create interest as your recipient determines which mail pieces to review and which to discard. More about the ROI of plastic cards a bit later …

Response rates
Now that your mortgage direct mail piece was opened by the recipient, the offer and call to action really need to grab their attention to drive response and turn that recipient into an applicant and finally into a customer. Since the offer is one of the most important things to consider when designing a direct mail campaign, consider these techniques to enhance your offer and call to action.

Highlight the offer
Let’s face it, readers are busy, multi-taskers who tend to scan rather than read. Incorporate bullets to highlight the key benefits of your offer–they’re great for capturing your recipients’ attention.

Personalize the offer
Mortgage lenders are delivering more personal, relevant offers that are tailored to the interests of each recipient through the use of the latest personalization technology. For example, highlight the recipient’s specific qualifying APR or the anticipated mortgage amount for which they qualify.

Optimize the call to action
The call to action should be clear, simple and easy-to-use.

WWWdot: Integrate cross-channel marketing by directing an applicant to the mortgage lender’s call center or Web site. Better yet, set up a personalized URL (PURL) or specific landing page with content tailored to each applicant’s needs.

Here’s my card: Affix a “pre-approved” card with the mortgage lender’s call center or Web site as a call to action. Card packages are proven to lift response.

Check this out: Enclose a “pre-approved” check in the dollar amount of the potential mortgage loan offer with the mortgage lender’s call center or Web site as a call to action.

Color is cool
Color has proven to increase response rates. Direct-mail recipients are 55 percent more likely to pick up a color piece of mail first, according to Xerox. Other cool color stats include:

Color documents are as much as 80 percent more likely to be read.

Increases reader attention and recall by as much as 82 percent.

Boosts reader motivation to respond by 80 percent.

Improves brand recognition by as much as 80 percent.

P.S. read me
In the Handbook of Direct Mail, Siegfried Vogele suggests that 90 percent of recipients read the P.S. first, and sometimes that’s all they’ll read. Think of it as a summary–reinforce your call to action and tell your readers why they should follow through. A thoughtful P.S. always lifts response rates. Always.

Target an in-home date
Sophisticated marketers have moved from thinking about when to drop mail to when mail should be received; the conversation has shifted from drop date to in-home date. Data available through the Intelligent Mail barcode (IMb) enables marketers (who use the appropriate services) to know precisely when mail is delivered so they can staff call centers or integrate other channels like email, text or outbound telemarketing as an additional touch point for their offer.

Plans for the weekend?
With all that said, some marketers have found the end of the week to be most effective for delivery. This is based on the tested and proven theory that many people spend time on the weekend going through mail that was put aside to look at again. Targeting an in-home date closer to the weekend puts your mail on top of the pile.

Mortgage lenders are successfully using direct mail to grow their business through partnership with experienced and knowledgeable direct marketing specialists, creative designs that demand attention, and offers that drive a strong call-to-action. Combining these best practices into your next direct mail campaign is destined to increase open and response rates of your mortgage offers.

Michelle B. Peel, marketing services specialist at IWCO Direct, has nearly 20 years of direct marketing industry experience. IWCO Direct is one of the largest direct mail printers in North America and works with many leading brands in the mortgage industry. Michelle may be reached by e-mail at [email protected] or call (610) 562-1065.

This article originally appeared in the February 2014 print edition of National Mortgage Professional Magazine. 

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