Focus on the quality, quantity and cost of your mortgage leads
Joey Liner, vice president of sales, DoublePositive Marketing Group
As published in Scotsman Guide's Residential Edition, January 2007.
Most loan officers would agree that marketing is the main driver that puts their businesses in motion. Finding and attracting new borrowers is the lifeblood of any mortgage originator.
Because a full-time commitment to marketing typically is not an option for individuals or for small to medium-sized organizations, many choose to outsource their marketing functions. Outsourcing can take many different shapes and forms. Historically, one of the most-common methods of buying and selling marketing services is on a per-lead basis.
Buying marketing services on a per-lead basis is attractive when compared to the cost and risk of buying lists, buying media, buying direct-mail materials or hiring telemarketers.
There are many online and paper mortgage leads, and all the sellers of these leads claim they have "the good leads." Most mortgage-lead buyers, however, may not know how to measure exactly what "good" means. Moreover, there are endless debates about how to define and quantify "lead quality."
There are three items, though, that should be examined to measure the total effectiveness of any lead-supply channel: quality, quantity and cost.
1. Quality is defined by the total number of leads that will convert into funded loans, ultimately bringing in money instead of costing money.
2. Quantity is an indicator of whether a lead-supply channel can provide enough leads (and ultimately loans) to support the business objectives.
3. Cost is the price paid per lead.
No assessment of any lead-supply channel is complete without an examination of all three of these dimensions. Having only two of the three pillars is unfavorable. The true lead-buying optimization process requires a delicate balance of quantity, quality and cost. It's difficult to adjust just one of these items without directly affecting the other two.
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