I know many people are not big fans of online leads. They either think Internet leads are "junk leads," or that they only work for dial-a-lenders with deep pockets for advertising and an army of salespeople who circle the Internet waters like sharks.
Neither view is accurate. As a division of a regional bank that has doubled its online lead conversion rate in two years, we learned that with the right strategy and the right tools, anyone can succeed at online leads. The trick was learning what to do and creating a system that helped us do it.
After our early experiment in online leads, we learned that a few fundamentals were needed to consistently convert online leads; among the top are:
- A well-thought-out strategy.
- Consistency from our sales team.
- A high speed-to-contact rate.
- The data to know what worked and what didn't.
As we tried different tactics, we also became aware of a "sweet spot" that existed between the number of contacts we made, when we made them, how we made them, and how often. We didn't know exactly where this "sweet spot" was; only that certain actions we took were getting better results.
The problem was that we lacked the discipline to precisely locate this "sweet spot" and hit it consistently. Our loan officers are only human, and it takes time to analyze every lead and decide who would be best to handle it. We realized, however, that technology might be able to help.
We began looking for technology to help us. We eventually came across Velocify, a sales automation company with a lead management platform, LeadsManager, and an automated dialer, DialIQ. For us, it was a perfect fit. LeadsManager gave us the ability to prioritize leads based on any factor we chose and allowed us to distribute certain type of leads to different loan officers. Meanwhile, DialIQ was able to get our loan officers on the phone with prospects in 10 seconds or less. That's when things began to change.
The results came quickly. A motivated borrower could submit a contact form through one of our landing pages or online lead partners, and in the time it took them to take a sip of coffee, that borrower was talking to one of our sales reps. Even better, we now had automated communication tools and reminders that allowed our sales team to follow up with prospects at predetermined times and frequencies.
Immediately, this level of speed put us on a whole new playing field. For just a fraction of our profit on a single loan, we now had a response rate that meets the online borrower expectations. Our contact rate soared to more than 90 percent, a number that most lenders can only dream of. But the best part about our new "top speed" was that we could now test our strategy very clearly.
We began to learn which leads were getting the best conversion rates. We could also determine which contact strategy worked best—that is, the combination of phone calls, emails and text messages that resulted in the highest chance of conversion. We even began to learn which loan factors, such as the type of product, purpose and property characteristics, made certain leads more likely to close.
Today, more than half of all the loans we closed since our new strategy went into effect are those in which our sales rep contacted the borrower within the first hour, and for more than 25% of them, the contact was made within the first 10 seconds. But our performance continues to climb. We are still closing loans from contacts we made with consumers three years ago. They weren't ready to buy a home or refinance then, but we were able to nurture them until they were.
Over the long haul, ignoring online leads is going to make it difficult for retail lenders to survive, since recent studies clearly show more and more borrowers are finding their lenders online. In fact, I'm curious why so many aren't looking for their own "sweet spot" with online leads. I'm sure glad we found ours.
Joseph Semrani is the head of a national telesales group in a mortgage division at M&T Bank and has been managing loan officers for the past decade at various mortgage companies. He can be reached at JSEMRANI@mtb.com.