Your Mortgage Decisions
Leads are the Marmite of the mortgage industry – they can be your bread and butter or leave a bitter taste in your mouth. But as the market shrinks and it becomes increasingly difficult to find and place clients, can lead generators really be a waste of time and money? Yes and no.
Without doubt there are brokers who throw good money after bad on poor quality leads. It can be particularly difficult for those with limited resources, including small companies and one-man bands.
On the other hand, companies like mine spend an average of £50,000 a month on leads. We don’t hand over that sort of money for anything less than a healthy return.
So what makes lead buying a palatable and profitable process? There is a simple formula for success:
FOCUS: Choose your market and stick to it. Don’t veer off course for a tempting cheap lead here or a wild card there. Consistent leads make for happy brokers.
TIME: It’s of the essence. It’s crucial that clients are called within minutes of them placing an enquiry.
Our telemarketing department is open seven days a week for that reason. Leads have a short shelf life – your clients will either lose interest or have already spoken to a competitor if you leave it too long.
DELEGATE: I believe brokers should stick to what they do best – face-to-face mortgage advice. That’s why a specially trained telemarketing team is vital to take care of converting leads to appointments.
Returning to the Marmite analogy for a moment, making staff multitask spreads their skills and their time too thinly. Brokers should concentrate on giving advice to clients, telemarketers on the bookings.
QUALITY: You get what you pay for. Too many people sacrifice quality in search of the cheapest leads.
I only allow our telemarketers to book leads that meet our tried and tested criteria. They spend half an hour on the phone and ask 70 to 80 qualifying questions. Only then can they book an appointment with our brokers.
SHOP: Make sure you shop around for leads to get the best deal. Use several suppliers and monitor their quality and conversion rates. Let them know if you’re not happy.
VOLUME: Make room for leads in your budget – the more valuable leads to pursue the greater the financial reward. As long as you separate the wheat from the chaff, there’s no need to hold back, volume is key, even in a trial you need to buy a sizeable number to assess their quality.
Love them or hate them, for me, purchasing leads is a crucial part of the mortgage business. Invest in them wisely and a little can go a long way.
It’s getting it wrong that gives lead buying a bad name. Cutting off the leads supply entirely makes the potential client pool much smaller which many companies can ill afford at present.
Buying leads could become a necessity in an online world
Association of mortgage intermediaries
All of us in the mortgage industry have had to adapt to a different world over the past decade. How customers arrive at us is liable to be the biggest change over the next. The use of the internet by a new generation of house buyers and its use by those looking to move home or remortgage will forever change our marketing approaches.
As people search, assess and enquire on loans, firms will need either a smart online presence or have to accept that they will be in a bidding war for leads from aggregators or prime websites.
This change in how consumers look to locate and fund their property aspirations will mean many brokers will have to be ready to change how they acquire business. Building a website that delivers what customers need to know, is relevant, current and ranked high enough to gain traffic, will be beyond more than a handful of firms.
We will need to find a way of validating the lead generators we can trust to deliver the right quality
As the world migrates online, a willingness to buy leads could become a necessity rather than an election to sustain a business. In doing that, once bought, the process of making contact in a timely manner, making the right enquires and persuading the customer that you are the one to trade with is a fresh set of techniques.
I am sure that there will be many who have found buying leads a less than satisfactory experience, as unfortunately there are a number of unscrupulous operators out there. I am also certain however that this is not going to stop the inexorable drift from the consumer’s perspective.
Gaining the process and skills to convert online leads into successful sales requires a contact discipline and follow-up that is new and needs training in.
As an industry we will need to find a way of validating the lead generators and aggregators we can trust to deliver the right quality of leads at an economic price.
A strategic part of business
Director of marketing and partnerships
Any mortgage adviser not using online lead generation to source business is missing out on a valuable opportunity to reach an increasing number of consumers going online every day looking for financial advice.
A recent report by Greenlight Search showed that there are some 550,000 searches online for mortgage related keywords in just one month with a further 666,000 for loan related searches. That’s a lot of people going online looking for mortgage advice.
While it is possible for advisers to generate leads from their own websites, buying leads is undoubtedly the most effective way to reach mortgage customers going online.
With so few products available and tight lending criteria advisers need to drill down to a more targeted customer such as those with sub-70% LTVs and clean credit histories.
It is expensive and difficult to target these consumers through a small website. Lead providers aggregate thousands of enquiries each day so can supply more filtered leads at reasonable prices.
Despite the thousands of advisers that buy leads, lead generation still gets a lot of negative press. When you talk to those who have had bad experiences once you dig into the details it is not the actual lead performance that is the issue – it is the adviser’s expectations.
Lead generation like any form of marketing is about generating a return on investment. Success or failure should be measured in these terms not by conversion rates or any other metric.
While it is possible to generate a healthy ROI from even a modest spend, successful lead buyers will have spent months refining their processes to maximise the value of every lead, from creating an optimum contact management strategy to objection handling once they have got the consumer on the phone. Advisers new to lead generation shouldn’t expect to generate thousands of pounds in business from the first £100 they spend.
At the same time lead providers would be foolish to think all advisers will be successful with lead generation. But the majority of lead buyers can make a good return if they follow best practice recommendation. Unfortunately, there is little sharing of best practice between advisers.
Successful lead buyers see lead generation as a strategic part of their business and take a long-term view rather than looking to generate a quick return.
For example, rather than trying to find the supplier of the cheapest first-time buyer leads, it is better to start out with how much mortgage business you want to generate over a certain period and work with the provider to find out how many leads are needed to achieve this. You can then come up with different scenarios to determine whether lead generation will work for you.