The Top Three Things That Changed While TRID Consumed the Mortgage Industry
For many of us, 2015 was the year of compliance. Every institutional lender was obsessing over TRID and watching every move the CFPB made. This necessary distraction took a lot of the energy out of innovation at many of our companies. When you are spending millions to overhaul a banking platform, you aren’t focused on helping Originators generate more business.
January 2016 provides us clear air and a perch from which to witness the industry shifting. Three of the most significant changes that will impact your business are: Your clients are online and mobile (more than you realize), sales funnels are getting good, and adding value is complicated.
Your Clients Are Online And Mobile
Over the past two years, total digital media usage has grown 49% with mobile apps having grown 90% and contributing to 77% of the total increase in time spent. That trend impacts us because 94% of home buyers started their search online in 2014. The technology isn’t sticky enough yet to pull those 94 of 100 buyers into a lead funnel, but it is getting better.
Redfin has spent over 100 million dollars to make their mobile app and website so good, I know of at least 3 non- Redfin Realtors that use it regularly, (although they will deny it). According to Brad Inman, 2014/2015 Real Estate Tech institutional investment could top $2 Billion. Gary Keller predicted that by 2020, we would see transactions completed end to end from search to financing on a single platform.
I could go on. The bottom line is that online and specifically, online mobile is the future of both lead generation and transaction management. While you probably can’t launch a mobile app of your own yet, you should be thinking in terms of “mobile first” with everything you do.
Today’s Easy Win: Use your mobile device to communicate with your clients in ways you haven’t before. Send SMS text updates, find them and message them on FB. Start using mobile apps for your own business. I am a huge fan of Evernote and Dropbox.
Sales funnels are getting really good, and Originators are lousy with them.
Most of us are reluctant to put our e-mail address into a website because we fear being “spammed”. It often feels like spam, but when you really have a need and you find someone with an answer, it can be amazing.
In preparing to launch my business I reluctantly input my e-mail address into a VOIP provider website for a white paper. The white paper added value, the next 10 emails I received expanded effortlessly on the white paper and after my education was complete, the rep rang and I signed on the bottom line.
The competency of educating and converting buyers is broadly lacking in the real estate and mortgage space. Largely because independent operators don’t have time to develop content platforms.
We are not consistent enough in our follow up and don’t add enough value to help sway a buying decision. This is the single greatest reason some of us feel “online leads don’t work.” Zillow reports that the average Originator closes at 2%. In my travels there are people all over the country closing at 10-12%. The difference? A salable, sustainable lead funnel.
Today’s Simple Win: Commit to a consistent set of three or four value added e-mails you will send to every prospect. My favorite shareable content can be found at Keeping Current Matters.
Adding value is complicated.
I have spent years working with Originators on their value proposition. The underlying question that drives every purchase decision is what value makes me chose you?
For years good service, constant availability and clear communication where the benchmarks for Originators to earn Realtor business. Then we engaged in co-marketing agreements which gave us the right to pay for business. Now we are paying half of a Zillow spend and don’t have the methods to effectively track ROI.
I was recently engaged in a conversation with a top RE Broker. He made it very clear that the co-marketing money is meaningless if someone could come along and help him to increase his closing rate by 30%. Let that sink in, the first person that comes along with a scalable conversion platform will eliminate the value of your marketing partnership.
The next phase of value creation will focus on generating and converting leads. The increased cost associated with playing properly in the new portal reality renders writing a check meaningless if it doesn’t’ come with an increased yield or lead generation. It is worth noting that if you don’t communicate well during a transaction and close on time, this discussion is completely meaningless.
Today’s Simple Win: Meet with your top 3 Realtor Partners this week and have a meaningful discovery discussion about their business and how it is changing. Ask them specifically what you can do to help with conversion.
As we embark on a new year, rates will go up and down, inventory levels will go up and down, and compliance will continue to burden our operations, the thing you control is your approach to the market. Your clients are using mobile devices, your lead funnel is probably horrible and we need to figure out how to actually add value. Originators are uniquely suited to winning in this next market, we know how to use technology, we are process oriented and are great at delivering customer service. Go create wins.
If you would like to join the discussion, head to LinkedIn and leave a comment.