One day, they say, online will replace television for reverse mortgage leads.

But there are some distinct differences between the online borrower and the kitchen table borrower, one lender on a panel of reverse mortgage executives shared at a May National Reverse Mortgage Lenders Association conference held in Irvine, California.

Census data indicates the 65-plus age group is increasingly using the Internet regularly. The percentage is around 40% for that age group, and is nearly double that for the age 50-64 demographic.

That trend is only going to get stronger, says Reza Jahangiri, American Advisors Group CEO.

“We are seeing 62 to 65 year olds are the largest lead group online,” Jahangiri said before conference attendees. “But they are converting by far the worst from lead to fund.”

AAG has more than doubled its retail business year over year, and has closed 944 loans to date in 2012, according to data from Reverse Market Insight. In addition to online efforts, AAG works with former Senator Fred Thompson as its spokesman appearing in TV ads.

Shifting to online, the company’s research on its online leads shows two things, Jahangiri says.

“First, the borrowers with less need may still be working and may have more substantial savings.  Typically, when the borrower has a greater need they convert at a higher rate,” he says.

The leads convert much faster when they’re generated online, he notes, by about two weeks. But, AAG has found, a borrower who contacts a lender online is likely shopping around.

“Someone who finds you on the Web is quick to find your competitors as well, so you’re dealing with a more price-sensitive borrower rather than someone who is proceeds-sensitive.”

Even if the person is not immediately in the market, follow up is still important. AAG says following up with mail or email is essential, with Web leads proving to be largely faster in terms of conversion and requiring quick, immediate attention.

“It might not be the right time for the person right now, but life circumstances could change that, so it’s a critical way to gain efficiency.”

Lenders must go where the borrower is seeking information, he says.

“We have made Web the No. 1 priority for marketing in the future,” Jahangiri said. “If you have a retail platform, you need to be learning right now and getting active.  It is going to be the primary growth source for direct response leads and it will trump television eventually. The numbers don’t lie.”

Written by Elizabeth Ecker

Those Americans born between 1946 and 1964 number in the range of 77 million according to census data. Increasingly, those in their 60s are looking into home equity as a retirement income source, a recent MetLife Mature Market Institute study showed.

In talking about home equity products with these households, originators may be wise to consider a few things. ”Ageless marketing” while maybe counterintuitive, is paramount among them, says Jim Gilmartin, founder of Chicago-based Coming of Age Marketing.

“If you believe there’s a ‘senior market,’ you probably have the tendency to believe there’s an ‘average senior,’” Gilmartin told RMD in an interview. “The bottom line is, the older we get, the less we are alike.”

Grouping or categorizing the boomer demographic is a danger that many companies run into in their marketing efforts, Gilmartin says. Getting past any stereotypes or ideas that the group can be defined by age is the first lesson.

“You can look at age as giving you direction, as in understanding that people in certain ages do certain things,” he says. “But if you focus on age and not life stage, you are making a lot of mistakes.”

Of the many observations Coming of Age has made in its 20-plus years consulting on marketing to those in the later life stages: Honesty is more important than ever, as is the first impression, since older people tend to value first impressions much more highly than young people do.

Marketing reverse mortgage products to women is another guideline. The woman of the house is likely to have a more emotional attachment and a stronger stake in any home equity decision-making, says Gilmartin.

Some physical considerations are also important. Images are proven to work better than words on a page, according to Coming of Age research. Look to images, metaphors and similes as communication tools, Gilmartin says.

A typical direct mail marketing piece increases its impression tenfold when it features pictures and a story, for example.

“People like a beginning, middle and end. As a result, those who use anecdotes and story formats get the attention of this market.”

The 50-64 year old population is also going online increasingly to get information with the use of social networking increasing 88% in 2010, according to Pew Center research. But while boomers are plugged in and are online, meeting with them face to face is a timeless strategy.

“Get into the community as much as you can,” Gilmartin says. “Train your sales people to understand who they’re talking to. You’re not there to pitch a product, you’re there to pitch an experience. What’s the [reverse mortgage] going to lead to? A better quality of life. That’s what’s going to get their attention.”

Written by Elizabeth Ecker

The site, which says it is directed at the already immense, and rapidly growing, baby boomer generation, promotes the premise: “You’re just older. You’re not dead.”

The One Reverse partnership formed based on work its parent Quicken Loans has done with another site, Fathead, under the same owner. Mickey Charles, who is also president and CEO of The Sports Network, which receives 1.7 million visitors monthly, according to data from Quantcast, has several sites under way, including the new boomer-facing site. One Reverse advertises on the site, provides reverse mortgage-specific content, and is Older Not Dead’s preferred reverse mortgage provider.

“The company that started the Older Not Dead site manages a few other sites and some within our family of companies have had great experience with them,” Richard Mandell, One Reverse CEO told RMD. “When the Older Not Dead site came up, it was a good introduction for us.”

Mandell has authored articles for Older Not Dead and will contribute one to two times per month.

The partnership is not intended to be a leads driver, but the opportunity may emerge as the site gains traction, company execs say.

“We’ve gotten a few leads, but nothing significant yet,” said Kim Schachinger, vice president of marketing at One Reverse. “Our involvement initially was not to get leads, but participating in a site that makes sense for our demographic in a way we can be educational to people. Once this gets some exposure, then we will be looking to get leads.”

Older Not Dead was founded by Mickey and Roz Charles of The Sports Network as a dedicated resource for the 80+ million baby boomers in the U.S. today.

Written by Elizabeth Ecker

“It’s a credit to the industry,” says Teague McGrath, director of marketing for AAG. “Networks are less wary and are happy to air our commercials.” McGrath notes the ability of AAG to expand its media buy as well, as a result of its successful leads-generating business. “We can now step it up to that kind of bracket of spend and exposure,” he says.

The spots, which range from focusing on the current economic struggles of many American seniors to testimonial input from a happy AAG customer, will roll out over the course of this week. The economy is one strong point in the commercials, and the incorporation of a testimonial featuring an interview between Sen. Thompson and a customer is another, McGrath says.

The borrower was chosen during a six-week process that started with 120 happy customers and through the process, landed AAG with a World War II veteran who had used his reverse mortgage proceeds in part to travel with his family to some of the places where he had served.

“It was about him and his story and someone who could speak for the product,” McGrath says.

In light of new changes to underwriting that are pending the decisions of many reverse mortgage lenders, including AAG, the company did have to change its disclosures slightly.

“We are the most conservative in terms of what we disclose and disclaim,” McGrath says.

The commercials, which represent the next wave of new commercials following a new Robert Wagner campaign rolled out earlier this fall by Urban Financial and new One Reverse commercials that are on the way, will hit airwaves over the course of this week. View the commercials below, or see them all via AAG’s YouTube channel.

AAG has doubled its reverse mortgage volume this year, according to data from Reverse Market Insight.

Written by Elizabeth Ecker

The rules apply regardless of medium, says James Milano, counsel, Weiner Brodsky Sidman Kider PC, who advises caution when it comes to the distinction between a transactional website and a promotional website.

“Be cautious of transactional websites,” Milano says—those where a senior can submit information or apply for a loan. “There are additional security concerns and rules there,” he says.

From a licensing standpoint, it’s important to list all licensing including state information, the panelists said. While in the past there may have been some grey area with regard to the rules of compliance online, “What was once grey is quickly becoming black and white,” said Milano.

Under the Truth in Lending Act there are certain “trigger” terms that require additional disclosures, such as “rate” and “payment information.” Those may require some additional review. And when it comes to state regulations, state by state, rules vary. In Massachusetts, for example, additional licensing is required for generating leads, beyond the origination requirements for website compliance.

“Most states define ‘advertisement’ broadly and are likely to consider a website advertising,” Milano says. “We think the prudent approach is to treat your website as an advertisement and make sure it adheres to state regulations.”

Be careful about broad statements, especially superlatives, the panelists say. “Stay in your home forever,” is a promise to avoid. As is “no mortgage payment ever.” Technically, there is a payment obligation when the loan becomes due and payable, so “no payment ever” is not entirely true.

Further, lenders may look to adjust language surrounding income and credit requirements. In the past, “guaranteed no income or credit requirements,” may have been true. “It’s going to be an issue going forward,” says Bill Trask, senior vice president and chief counsel for Security One Lending, referencing underwriting changes that the National Reverse Mortgage Lenders Association encouraged last week. “Even though we are calling it underwriting ‘light,’ we are going to look at those qualifications.” Company names and online branding should be consistent across branches, Trask says. Those kinds of differences are something that regulators may tune into, he says.

Finally, record keeping becomes paramount for any web inspection. “Sometimes you have a very short time to deal with this,” says Trask. “Keep copies. You need to be prepared beforehand.” While websites can be very dynamic, the best way to keep a record is to print out the pages and date them, the panel said.

Written by Elizabeth Ecker

For Genworth Financial Home Equity Access (GFHEA), the Internet provides a better way to generate a consistent number of leads for their originators. As a result, it has shifted resources online because of one thing: predictability.

“[The Internet] gives us a lot more predictability in terms of our lead flow,” said Mary Smith, director of marketing for GFHEA during a panel at the National Reverse Mortgage Lenders Association conference in Boston this week.

Online lead generation has been so successful in certain regions of the country, that the company has started to offer surplus leads to its wholesale partners, Smith said. GFHEA’s ability to generate leads online grew significantly when it acquired Reverse Mortgage Guides last year for an undisclosed sum.

With its success online, the company hasn’t turned its back on direct mail, but high costs have forced the company to bring everything in-house. ”We used to outsource our direct mail,” she said, but by bringing it within the company, GFHEA found “response rates are just as good and improved our cost structure.”

No matter the channel, all of the panelists said that lenders need to have a long-term perspective when developing any type of marketing campaign.

“Budget it that way,” said Mike Gruley of 1st Financial Reverse Mortgages. “If the first couple of months are lousy, it could be as a result of the long sales cycle with reverse mortgages.”

Knowing when to pull the plug on a campaign can be extremely challenging as well. ”It’s a real subtle balance between committing and over committing,” Gruley said.

Online is no different; there needs to be a willingness to be in it for the long haul.

“You can’t go into Internet marketing and have a short-term perspective,” Smith said. “You don’t turn on a program and it works [right away].” Lenders must be willing to test a lot of different copy and be focused on results, not what they “think” works best. “[It will take] a lot of time and effort to get it to work.”

Tracking the response rates and loan close ratio is a must as well, the panelists said. Without tracking, it’s almost impossible to measure the results, said Harlan Accola of Envoy Mortgage of Wisconsin, who said the company is spending anywhere from $1,000 to $1,800 to generate a closed loan from a purchased lead.

“We know the shelf life [of our leads] and know you need to be patient but proactive,” he said. “I can’t stress enough the tracking. It’s so important.”

The campaign, formerly owned by Guardian First Funding, which was acquired by Urban’s owner, Knight Capital, showed signs of a reboot earlier this year, upon the acquisition announcement. With the deal closed and seven months of creative work on what will total five new spots, the new campaigns will be hitting the airwaves.

“We interviewed hundreds of previous customers for common themes,” says Jason Levy, head of Urban Financial’s retail division. From those interviews, Levy says, Urban identified two main themes.

“One, borrowers involve family and children. That’s why we did the one with Katie. We’re sending the message that the family can make the decision together.” Second, Levy says, is the improvement in lifestyle that a reverse mortgage offers.

Three additional spots will roll out over the next 30 to 60 days, and will also offer different messages. The new campaign not only serves Urban’s retail brand, but should also play to its wholesale channel of brokers and branches, Levy says.

Exploring new avenues, including the introduction of an adult child into the commercial, is something other lenders have focused on recently as well. American Advisors group launched a new campaign focusing on testimonials earlier this year, and One Reverse Mortgage introduced former I Dream of Jeannie star Barbara Eden into its commercial mix, marking the first major female star to take her place on the reverse mortgage scene.

Lenders say the approach may change in some ways, but that education is still paramount in reverse mortgage TV advertising.

“The educational concept will never change. It’s important to educate first and evaluate whether it is the right choice,” Levy says.

Urban will also ramp up other advertising efforts to round out the new campaign.

“We’re also going to be focusing on building search engine optimization and a few other direct-to-consumer concepts so we can hit on all cylinders,” he says.

View the new commercials on YouTube.

Written by Elizabeth Ecker

Those advertisements often hinge on the voice of a celebrity spokesperson, as in the case of Robert Wagner (Urban Financial) or Fred Thompson (American Advisors Group), and on the testimonials of reverse mortgage borrowers.

While lenders are consistently adapting their messages to reach consumers, the market may now be coming around to the products enough for lenders to move toward a more brand-focused approach.

American Advisors Group, which is rolling out a new campaign featuring borrower testimonials, notes the turning point.

“AAG didn’t use testimonials previous to this new spot because we felt it was more important to build brand awareness and credibility before showing our happy customers to other consumers,” says Teague McGrath, director of marketing for AAG.

Other companies are altering their campaigns as well.

In a male-dominated reverse mortgage TV world, One Reverse is taking a step in a different direction. The San Diego, Calif.-based lender recently landed I Dream of Jeannie star Barbara Eden to appear in a commercial coming this fall.

“In many cases, women drive the financial decisions of the household,” Schachinger says. “As a result, it made sense to test women decision-makers.”

Education, however, will remain a cornerstone, Schachinger says.

“There has been a good amount of reverse mortgage advertising in the past few years helping to educate consumers, [but] many of them still ask a lot of questions and require additional attention to make them comfortable with the product. The objective of our advertising is to not only educate but reinforce One Reverse Mortgage.”

With education as the cornerstone, the message of established brands such as those represented by Robert Wagner remains.

“Over the years, the Wagner campaign has been the flagship for educating consumers on the potential benefits of a reverse mortgage,” says Jason Levy, Head of Retail Division and Brand Management, Urban Financial Group. “Urban’s brand mission is to not only attract a potential customer with a call to action message, but rather have the senior community call because of our brand educational awareness.”

But with that education under way, comes a new opportunity to shift practices, as AAG is doing.

“We always had this spot in mind as part of a staged brand awareness strategy,” says McGrath of the new campaign. “Build a sense of who AAG is, back it up with good service levels and origination numbers proving we walk the walk, then follow up with borrowers who have had a positive experience with an AAG and showcase this to the public. It is proving very successful for us.”

The education is causing AAG to reassess some past strategies as well.

“People have a much better understanding of the product now than they did even 12 months ago. It means the DVD and brochures we send out aren’t as relevant as before.”

Written by Elizabeth Ecker