Need for Equity Release and standard mortgage products is higher than ever, but due to external market pressures, conversions from enquiry to business is becoming a real struggle for brokers. Thomas Brett, our head of mortgage and lending explains why the customer journey needs to change as the market changes.
During a buoyant market for secured lending, where rates with historic lows were available, marketing for equity release and mortgage customers became a race to the bottom with one clear message;
‘borrowing is cheaper than ever, buy now!”.
Unfortunately, due to many external factors, those days are behind us, and they don’t look like returning for a while yet. So, as customer’s attitudes have changed due to higher costs and lenders’ risk capacity has chastened, why haven’t the marketing practices and customer journeys towards advice changed?
While the use of the same journey of advert to calculator which captures contact details will still provide volume, these enquiries will inevitably convert at a much lower percentage when the customers ‘discover’ the higher interest rates, or the loan to values don’t stack up against customer need.
The firms innovating their marketing and customer journeys are the ones who will navigate these tougher times successfully and, by improving how the customer enters their advice process will in turn improve their market share.
Just receiving contact details won’t work when conversions are lower, brokers can no longer play the ‘numbers game’ with lead volume. Every enquiry that enters their system will need to have a chance of business.
Taking customers on a longer online journey, with more detailed questions will produce a higher drop off rate, and leads will be more expensive, but conversions will increase. As long as the price point is set correctly, this will be a much more fruitful campaign as less wastage will also reduce staff costs.
Customer Led Contact
Thank you pages after a customer has entered their details are very often an afterthought. This is a missed opportunity as these can still add so much value to the customer journey.
Information can be provided here, or even appointment booking options so the customer can choose how and when they are contacted. This will improve contact rate which is the first step in lead to conversion metrics.
Again, this reduces staffing hours needed to continuously contact potential customers when they have a specific time picked to start the advice process.
Budget based on BI.
The firms who are on top of their business intelligence on their marketing campaigns, both internal and external will see ROI improve.
Budget placement needs to be based on lead to business instead of volume, as this is a false economy when conversions are so much lower than before.
By utilising real-time feedback on campaigns, firms can be much more agile when deciding which advertising and customer journeys are working for them. This is typically tricky in Equity Release where the advice process can take 12 weeks from enquiry, so the firms who do this right will have a huge advantage.
The need for these life changing products is greater than ever while we navigate through a cost-of-living crisis, younger borrowers are looking to help top up income or remortgage and older borrowers are looking to help loved ones who are struggling.
We need to lengthen the online journey and give the customer the power to choose how and when the advice process starts. That way, conversions improve, but most importantly, the customers who need us most are serviced.