As published in Scotsman Guide's Residential Edition, July 2008.
Clearly, the mortgage industry took a huge hit in the past year. But I don't think anyone expected the repercussions to be so drastic.
The fallout of the nonprime industry and the ensuing credit crunch certainly cast a negative light on the mortgage industry. Consumers have been shell-shocked by the damage created by adjustable-rate loans. The foreclosure rate is skyrocketing, and the real estate market is reeling from the downturn in home values and from reduced equity positions.
Further, in the past few years, many mortgage companies closed their doors. Every aspect of the mortgage community has been affected to one degree or another.
Obviously, it's not business as usual any longer. Now is a good time to look at your marketing methods, however. What worked for you previously may not work today.
All forms of marketing have certain pitfalls in terms of perceived credibility to consumers, but they also can be successful when used properly. Here are the pros and cons of a few popular marketing methods.
More than 75 percent of U.S. households are on the federal Do Not Call Registry, according to a 2006 Harris Interactive poll. As such, telemarketing is used less for mortgage-lead generation than before.
It is hard enough to survive when you have a large client base, but it's even harder when you can reach out to only 25 percent of the market.
Some telemarketers who generate leads for mortgage brokers have questionable practices. Their methods only add to the skepticism about mortgage brokers among consumers.
For instance, once a homeowner is on the phone, an unscrupulous telemarketer will look for some area within that homeowner's profile and within the loan program's criteria to exploit. This will not generate successful loan prospects for you.
There is a solution, though. Many telemarketing companies offer live-transfer-lead programs. These leads can produce higher-than-average close ratios because they are produced in real time and are transferred directly to you at the time of contact -- hence the name.
When done properly, a good telemarketing live-transfer lead can be an effective tool to have in your marketing toolbox.
Even if you can get by the spam filters and enhanced security features in people's e-mails, your response rate to blast e-mails likely will be next to nothing. There are several reasons for this.
First, data -- i.e., e-mail addresses -- can be difficult to find. Additionally, people are skeptical of e-mail marketing because of the multitude of e-mail scams in the past few years. Although this type of marketing sometimes can be useful for lead generation, e-mail's return on investment is inherently low because of the restrictions associated with this form of coummunication.
To make this work for you, find an e-mail-marketing company that lets you test its e-mail-blast program on a small scale before you commit to a larger program. When you test the waters, pay particular attention to how data are obtained.
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