One of the most common complaints that I hear from managers is how Quicken is soliciting borrowers before the lender’s sales staff is able to do so. By reaching out first, Quicken is able to get loans from bank customers before the bank that owns the account! Lenders are frustrated and upset that their own sales force isn’t able to prevent the fast-moving mortgage company from winning at the point of sale. In my opinion, there are two reasons for this problem. One is data and the other is execution.
Determining when the borrower is looking for a home, wants to refinance or begin a home improvement project used to be an impossible task. Now, this information can be obtained with a few keystrokes. Frankly, data is everywhere and easily obtainable if a company wants to really know their customers. For companies that don’t invest in capturing and analyzing customer data, all I can say is shame on you. Data and understanding your customer’s needs are mandatory if you want to be successful in lending.
When a bank has customer data, distributing this information to the sales force and having them act on it quickly is often another big roadblock to getting the business. The problem lies with a 100% decentralized sales organization and originators’ ability to promptly call the customer while they are handling their own self-sourced customers. Time and time again, what happens is the lead gets lost in the shuffle of other sales activities and the producer fails to contact the lead fast enough. The core reason for this is clearly in how the sales structure is set up and managed. Let me explain.
In my view, Quicken’s advantage isn’t in data collection, although they are very good at it. What sets them apart from many companies is that they have a structured sales force that is centralized and managed with execution standards that are enforced. Simply put, their sales structure is in alignment with making every customer interaction fast, effective and convenient.
Many lenders have a sales force that is independently owned and operated and executes in their own interest and not the lender’s. Even lenders that assign an originator to a local branch is kidding themselves that this is enough to win in today’s mortgage origination environment. The strategy of just hoping that customers will be walking into the branch is wishful thinking. When a bank places a flyer in the teller’s window that between 9 and 3 there will be a mortgage rep available to answer any mortgage questions, what are they expecting? People are working!
Consumer marketing has undergone dramatic changes and the definition of what is convenient for the lender is not necessarily what works for the consumer. Consumers want interaction on their terms and not the other way around.
The bottom-line is that every lender needs to reevaluate their sales structure and match it to today’s consumer’s buying journey. A great example of how this worked in another industry is GEICO’s transformation.
Originally, GEICO was a mom-and-pop business with local reps who targeted federal employees because they were perceived as less risky. The following years had ups and downs. Eventually, the company decided to centralize their selling first by phone and later by the internet. In the late 90s, Warren Buffett invested in them and now their constant advertising has generated top of mind in the insurance field. Everyone knows the Gecko mascot.
Today, GEICO is one of the top-rated insurance company in policies written and they are number one in customer satisfaction. They are also recognized as a price leader in the insurance industry. GEICO does have approximately 150 local branches for those consumers who want to speak to a person face to face. But, local offices make up a small percentage of the firm’s 40,000 employees. This success story shows that when a company decides to change course they can be even more successful if they have the right vision and execution. This should be a blueprint for mortgage lenders.
Quicken is winning because they are not only getting to the customer first but are managing the customer interaction so it happens fast and effectively. If you don’t believe me, just fill out a contact form for them and see when they call you. Then do the same for your sales force and compare the results. No wonder they are stealing accounts.