Sales psychology is about understanding and relating to our customers’ needs. Our InFocus article this month begins with a tale of car shopping. If you’ve ever shopped for a car, you know it can be a miserable experience. But have you ever asked yourself why? Often, it’s because you enter the showroom and a sales person is sharing information with you that you simply aren’t ready to hear. At this early stage, the sales person seems “pushy,” hence the term “used car salesman.”
This same concept applies to the mortgage business. Testimonials aren’t meaningful (or impactful) until the borrower is ready to absorb and apply the information — when they are ready to decide which, of a short list of lenders, they want to originate their loan. At this point in the decision process, the borrower cares about what other borrowers have to say about their experiences with this lender.
In our current market where lenders are focused on getting more business, this is an important aspect of the buyer’s psychology in selecting a lender. MortgageSAT director Mike Seminari analyzes our industry’s assumptions around the psychology of the sale in, “Which Came First, the Testimonial or the Sale?” Also, this month, Senior Partner Nicole Yung shares data from our recent Digital Innovations Survey that shows most lenders do get the point: technology empowers lenders and borrowers to positively enrich their origination experience. Both are great articles. We hope you enjoy!
By Mike Seminari August 2019
One of my colleagues is in the market for a new car. How do I know? She asked me not only about the car I drive (“Would you buy another?”) but also about what I’d heard about the two car models she’s considering. When I asked, “Have you checked reviews online?” she regaled me with the highs and lows of the car review world, including what she’d found on the manufacturers’ websites and half a dozen other websites posting car reviews.
It made me glad that my wife and I aren’t looking to replace our car anytime soon.
Over the past two decades, with the rise of Amazon, Yelp, Google and other star-rating services, consumers have come to rely heavily on peer feedback when making decisions about the products and services they buy. The mortgage industry has seen the same heightened emphasis placed on borrower feedback, much of it driven by complaints registered with the CFPB by unhappy borrowers (as of August 1, 2019, more than 1.3 million complaints have been filed with the CFPB since its inception). Our industry has seen a rise in the number of companies offering to collect and share testimonials across a growing number of websites, all under the assumption that increased online exposure correlates with higher sales revenue.
This assumption begs the question: Did the online testimonial produce the sale, or did the sale produce the online testimonial?
It’s good news for the industry that most lenders understand that the primary focus of digital technology is to provide a truly delightful borrower experience. How are you using digital technology to empower your borrowers?
STRATMOR believes lenders can stabilize in the current environment and build a scalable foundation for future growth by focusing on three objectives: optimize the borrower experience, renegotiate long-term contracts and evaluate compensation plans.
Senior Partner Garth Graham lays out seven common-sense rules for achieving mortgage borrower satisfaction.
STRATMOR believes that some of the commonly-held “facts” in our mortgage industry are truly myths that need to be debunked. In this article, Senior Partner Jim Cameron analyzes three possible myths using industry data and years of mortgage experience.