Take calculated risks, this doesn’t mean being rash…
Paul Hunt is a marketing consultant
On a panel session at FSE Manchester last week, lender bigwigs agreed that the intermediary channel would remain dominant for some time to come, as business via direct channels showed no signs of increasing.
Admittedly, not breaking news to most in the audience, but it doesn’t mean that we can all continue to do what we’ve always done as our position is secure.
I believe there are three areas that brokers need to look at closely, not only to survive, but to thrive. These are:
Customer retention and referrals
During the same panel session, Dave Rogers (intermediary partnership director at Barclays) said: “if borrowers sign up again with their existing lender without broker involvement then the broker hasn’t done a good enough job to keep them.”
I couldn’t agree more and I have seen this first hand with a previous employer, although I’d take this one step further, as not only do I wonder how many borrowers do use a broker to re-sign, but also use a different broker than they used for the original mortgage.
Either way, brokers need to do more to retain customers and there are many simple ways to do this, some of which are automated and require little resource once set up, although obviously your real work kicks in as they near the end of their product term.
Also, don’t forget that if you’ve helped someone get a mortgage and move into the property they set their hearts on, if they won’t be willing to recommend you to people they know, then I don’t know who will.
The holy grail is an end to end solution that starts at CRM, goes into affordability and criteria searches, then product sourcing, ID and then application. Ideally then the lender uses an AVM and let’s hope we find a solution to reducing the conveyancing time soon, so that we have an end to end electronic process eventually.
Whilst we wait for the stars to align, it’s clear that there are various aids to help brokers provide the right eventual outcome for their clients, plus save time & money for all parties.
I know I have said this in previous blogs, but until you’ve experimented and tried these solutions, can you be sure of the value they could provide to you or not, as the case may be? Being an early adopter of emerging tech might place you ahead of your rivals.
Life in general is so complicated and there is so much choice, it’s difficult to know everything there is to know. We are already seeing the buy-to-let market splinter with portfolio specialist brokers emerging, as they’ve realised that they need to be masters of this world and cannot try to be all things to all men.
I know brokers who only see customers with families, those who only see self-employed and contractors or those who operate in the poor credit sector.
By doing so they may appear to be limiting their potential customer pool, but actually by making it clear ‘what they wish to be famous for’, it’s clear to their targeted customer groups that they are the experts.
I can only see this trend increasing, as being a ‘jack of all trades’ may become an outdated model for the majority of brokers. Is there a target market that you do a lot of work in or is there a high proportion of a customer group in your local area?
For those people who know me well, you’ll know that I’m fascinated by history, especially military, and so I’m going to use a quote from General George Patton to sum up “Take calculated risks. That is quite different from being rash”.