With many reverse mortgage lenders today testing the waters of online marketing, some are starting to see enough results to say that the online borrower is a different type from the traditional sales leads generated through direct mail or TV ad campaigns.
The more proactive approach borrowers take in seeking information about reverse mortgages will largely present a more serious potential client, reverse mortgage lenders say. This is in contrast to the reactive approach that consumers take when responding to a TV ad or direct mail marketing piece that a lender has pushed outward.
Overall, though, those lenders marketing online say they are only going to grow their presence there based on the success they are having.
One Reverse Mortgage, a division of Quicken Loans that runs a TV campaign with TV and movie actor Henry Winkler at its helm, says the current proportion of its advertising devoted to TV is around 70%.
“We are looking to decrease that presence by utilizing and leveraging other types of partnerships and lead channels,” says Kim Schachinger, vice president, marketing for One Reverse.
The average value for a TV-driven lead is around $160,000 whereas the average for a direct search lead online is more than $215,000, One Reverse says.
Another lender seeing strong success in sales generated through online channels is American Advisors Group, which also runs a TV campaign with spokesman and former Senator Fred Thompson. Similarly, AAG says the borrower types show some contrast.
“We’re adapting to online marketing,” says Teague McGrath, director of marketing for AAG. “It’s a different lead and it is much more competitive.”
Part of the difference has to do with the time many originators spend with reverse mortgage borrowers. Even when working with borrowers over the phone, originators may spend multiple calls and many hours with a single borrower. The distinction is in how much education is needed.
“Online shoppers are in buy mode,” says Paul Fiore, director of sales for AAG. “They’re not in investigation mode. Someone who calls in response to a TV commercial tends to be more curious.”
Conversions to sales are not necessarily any higher for either form of lead, Fiore says, but leads sourced online provide more consistency.
“TV response can go up and down but Internet presence is more consistent,” he says.
Lenders in the online space plan to stay there—for the long haul.
“As a company we are preparing for baby boomers to move into this age range. They are typically much more online savvy. There’s nowhere to go but for this segment to grow,” Schachinger says.
AAG has grown its presence and plans to continue doing so.
“The volume has increased significantly,” Fiore says of the last six months. “We have seen it increase dramatically as far as number of people going online and generating leads there through our efforts.”
Written by Elizabeth Ecker