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Making Lifelong Customers

The art of developing customer-for-life campaigns.

Most loan originators know the importance of maintaining long-term loyalty with their customers. After making sure the initial transaction is a positive experience, the next step is staying in touch with customers, so that a competitor’s marketing doesn’t interfere with your valuable relationship.

Some LOs have very involved and expensive programs, while others take a more basic approach. However, they share a similar goal—to keep in contact with past customers on a regular basis. “It’s all name recognition,” said Larry Montani, a mortgage officer with First Interstate Financial Corp., Shrewsbury, N.J. “I can’t tell you the number of people who note that they were thinking of refinancing or purchasing and got our card.”
Added David Jaffe, originator with Chase Manhattan Mortgage in Westlake Village, Calif., “Staying in touch with your closed loan customers is the absolute best use of your time and resources to maintain and grow your business.”

Following is an overview of what some originators are doing to make sure their customers never forget them.

Database Support
Of course, you can’t have an effective customer-for-life program without an organized database. Scraps of paper and logbooks are passé, woefully inadequate to keep current with an expanding customer base. Jim Schmidt realized this early in his origination career, and now uses a combination of Outlook and Excel to maintain his database and schedule follow-up materials. Outlook is suited for everyday contact—including his basic e-mail updates—and Excel (Office Suite program) enables him to organize a database in such categories as rate, date closed, term, and attorney. “For example, I can sort past customers by their rates, or use a combination of factors, including customers who have a 15-year fixed, at a certain rate that closed during a specific time period. Then I copy and paste names into an e-mail I’ve prepared and it’s sent,” said Schmidt, an originator with Poli Mortgage Group, Norwood, Mass. “It’s a valuable tool for sorting data in a variety of ways.”

Schmidt said that ACT! or Goldmine probably would be “more sophisticated,” but that he prefers his current set-up because it’s already included within Office Suite. “It’s easy to use,” he said.

Randy Lund, a loan consultant with Silver State Mortgage in Las Vegas, NV, likes Goldmine because of the flexibility it offers. The program keeps track of past borrowers along with those who have been pre-qualified but not yet become customers. Lund can organize his database into various subgroups including Realtors and past customers, along with trigger dates, such as birthdays and loan anniversaries. “Goldmine is the backbone of much of my marketing program,” he said.

In addition, it helps him monitor his referral partnerships. “We’re able to track the quality of referrals,” he said. “For instance, we can analyze the number of an agent’s leads that actually turn into closed loans.”

Other originators prefer ACT! or other programs, including those highlighted in the Database Roundtable.

Regular Mailers
Once the deal has closed, many originators rely on “snail mail” to maintain visibility with their past customers. There are a variety of options from which to choose.

Newsletters- There is an abundance of newsletter options; some have a mainstream design and others are a bit different. Dorothy Reid distributes a quarterly newsletter—”Homes & Neighbors”—to past customers as well as agents. The newsletter (from MortgageNewsletter.com) offers general real estate/homeowner information, and includes her photo. “I’m providing them with value-added information and this gives the borrower one more reason to use me rather than the competition,” said Reid, president of Mortgage Specialists of Alabama, Inc. in Birmingham, Ala.

Cindy Worrell, an originator with Orchard Mortgage in Raynham, Mass. has proven that you don’t need an expensive format to gain reader interest. She and her husband-partner, Geoff, send customers a multi-page letter printed on colored stock. “Our newsletters are not likely to be viewed as a glossy marketing piece that may be passed along as junk mail,” she said. Each newsletter features a series of tips and, loan product updates, homeowner resources, and general/industry news, along with a listing of their free reports. The newsletter also contains their “letter from our heart,” a personal greeting that further helps strengthen the bond with their “family” of customers. “Many times we try to involve younger members of the family in our newsletter by promoting contests such as a coloring contest with a U.S. Savings bond as a prize,” she said.

Schmidt has learned that e-mail newsletters can be very effective. His quarterly one- page newsletter (using a template from Constant Contact.com) addresses a few different items and always describes one new loan program, such as interest-only mortgages, and may feature a cartoon as well. “I try to keep it simple he said, and offer a chance for them to pass the newsletter on to others simply by clicking on a link.”

Schmidt often incorporates action items in his newsletter, as a way to encourage customer involvement. For example, he will provide a trivia question that asks readers to call with their answer, for possible participation in a raffle drawing. “This gives us a chance to talk, and I can ask how I can help them on another loan, and ask for referrals.”

Postcards- Mary Glavin, mortgage partner at Professional Mortgage Partners, Inc., Downer’s Grove, Ill., considers postcards to be the most successful mailer. “Approximately 50 percent of my business comes from past client so it’s important to keep in touch,” she stressed. “I think you have a better chance of customers at least glancing at a postcard rather than reading a letter.” She sends a steady stream of postcards, many on “minor” holidays such as Valentine’s Day, St. Patrick’s Day, and 4th of July. Glavin tries to include a photo of herself, to help personalize the mail. A St. Patrick’s Day card featured an illustration of a leprechaun with Glavin’s face superimposed on the head, along with the headline “Just wanted to keep my face in front of you.” A summertime card shows her cooking at a barbecue with the copy “Rates are hot.”

Glavin agreed with other originators that past customers often receive a card or newsletter at just the right time. “There are instances where a past customer had been talking to a friend who was interested in a purchase or refinance,” she explained. “The customer tell us ‘I was just talking to someone and now I can give them your postcard.'”

Montani sends approximately 4,500 recipe, calendar, and comedy cards every month. Eight months of the year, he sends customers two cards per month—one is a recipe card and the other is a calendar card, and the other four months they receive a holiday greeting card as well. “When I first sent the recipe cards, people laughed at me,” said Montani. “But I’ve had people say that they wait for them every month. It’s not so much a matter of what you mail, but that you’re consistent in sending something.”

He noted that the cards include brief copy that ties into a mortgage related theme. “The cards have generated tremendous results,” he said. “I can’t tell you the amount of business I’ve had from direct mail alone. It’s my most effective marketing.”

Other Mailers- Originators also have mailed a variety of other items to past customers, including calendars, smoke alarm batteries, gift certificates, and other items. For instance, Kristen Pope, an originator with Access Mortgage, Destiny, Fla. has provided her past customers with a gift certificate to a popular restaurant, in addition to a one-year subscription to the quarterly Coastal Homes & Lifestyles magazine. “Being from a second home market, my clients love to be reminded of the beach,” she said. “They like to feel as if they are part of the community and this publication keeps them up-to-date on local events. The magazine is a remembrance of the times they have spent here with their family.”

Cindy Ertman, originator and vice president at Platinum Capital Group, Manhattan, Beach, Calif. and loan originator Linda Buchanan, developed a colorful marketing piece to send to their past customers and others. The front of the flier has a picture of them accompanied by the phrase: “If you want the best on the field, Go with the Proven All-Stars.” Inside there is a full season schedule for the Los Angeles Dodgers and LosAngeles/Anaheim Angels. She’s done a similar mailing that includes football and basketball schedules. “This is something that people will keep on their refrigerator or desk at work, said Ertman. “I no longer send postcards. We’re focusing marketing on those things that add value, that customers won’t throw away.”

Certainly one of the easiest ways to maintain contact is with simple e-mail updates. Lund makes sure he obtains the e-mail addresses of all of his customers. His bi-weekly e-mails include general news updates, interest rate changes, and industry trend news, as well as birthday greetings. “We’ve found this to be very well received,” said Lund. “Where we used to fax so many things, now we’re using e-mails. People have become more tech savvy and are used to this. It’s so much easier.”

Rick Jones, president of Cal Pacific Mortgage, San Diego, Calif., uses monthly e-mails as a way to stay in front of past customers. The e-mails highlight loan information as well as more general news and advice for such topics as tax time preparation and dealing with telemarketers. He now uses an ACT! add-on program that makes it easier to e-mail to a larger groups. “This is a great way to stay in touch with customers,” he said.

Annual Mortgage Review
The annual mortgage review is yet another example of a customer-for-life technique. Laura Lasher explains her Mortgage Fitness Review in a brief letter to customers on the first anniversary of their closing. “Together we review your short- and long-term plans, to assess whether you have the most cost-effective home financing package to meet your budget and needs,” says the letter. “I’ll suggest that they may want to meet to discuss specific areas,” noted Lasher, a home mortgage consultant with Wells Fargo Home Mortgage, Omaha, Neb.

Lasher notes that this is a subtle, yet effective way to generate customer loyalty. “It puts us in front of them, offering a personal note that we are here to focus on their needs. This is one easy step to stay visible.”

Jaffe’s mortgage review process incorporates a report from Mortgage Coach to show product options that he mails to customers. “We include that (and Rate Watch report) with an introductory letter and a questionnaire asking whether or not they plan to move in the near future, if they expect changes in their income, and related areas,” he said. “Two weeks later we’ll follow up with a call to see if they’re interested, and if a new loan program product might be appropriate for them.”

Jaffe noted that the mortgage evaluation provides a value-added service for customers, as well as another chance to remind them that you want their long-term business. “It shows that we’re looking out for the best interests of our customers,” he said.

Hosting events requires an investment of time and money, but this can be an effective method of enhancing rapport with past customers. Of course, you can’t invite just referral partners to events, as that would be a RESPA violation. However, if you didn’t want to invite all of your past customers, you could limit the invitation list to recently closed customers. Worrell has held a series of events, including golf tournament/fundraiser, piñata party for children, summer barbecue picnic party, magic show, and holiday gatherings. “”Face-to-face client celebrations allow clients to interface with us in our business home,” said Worrell. “It enables us to host events and treat them as guests in our office with a non-business and casual focus, allowing the relationship to develop further and with a personal dynamic.”

She strives to include customers’ families at many of the events. “By inviting the entire family and their friends/families, it allows our families to meet and share quality time together without the direct focus of business. It helps develop an incredible bond.”

Getting it done
One of the major challenges for maintaining customer-for-life campaigns is making sure that you follow-through. Many originators have outlined successful strategies, only to get busy and stop mailing or calling after a few months. Pope knew that to execute her customer follow-up program, she needed some help, and she preferred to have an in-house resource. “Implementation is not always my strong point,” she said. “I didn’t want to outsource because I needed someone who has a personal relationship and understanding of who my clients are and what their specific needs might be. I hired a marketing coordinator to help me strategize and implement a 12-month marketing plan.”

Other originators have determined that outsourcing is a better way to accomplish their customer marketing campaign. For example, Doug Grothjan, originator and branch manager at Charter Funding, Dayton, Ohio, stated that “I tried to do it on my own,” but realized the customer follow-up took too much time. He turned to the Turning Point, customer relationship management (CRM) specialists, to coordinate his program that currently includes a gift and then greeting/other cards sent to his customers on a quarterly basis. “They’re getting something from me five times a year for a three-year period and it’s all automatic,” he said. Grothjan explained that he regularly provides a list of his customers to Turning Point, so that they can distribute the various items on his behalf, and then provide him with a management report to update him on all activity. “I don’t have to worry about customer retention; it’s all taken care of,” he said. “Of all the marketing I do, it works the best.”

A customer-for-life campaign doesn’t have to be expensive or overly complicated. It should be consistent and ideally slightly distinct from your competitors’ approach. As most successful originators will stress, the key is to do something to stay in touch with your past customers, who are usually your most valuable source of referrals.

By David Robinson

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