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Special Reports
Lead Generation
Need for Leads Spurs Some Upgrades
By Amilda Dymi
In today's market where finding low-risk, high-credit-quality borrowers is key
for most lenders, lead generation is in the spotlight and spurring system and product upgrades.
Dan Welbaum, chief marketing officer of Mortgagebot LLC, stressed during in an
interview that in today's marketplace, to be successful, lenders need to provide "a very good customer experience
functionality-wise, simplicity-wise, comprehension-wise, accuracy-wise" and preferably online.
While lenders are catching up with e-lead generation, technology service providers
are catching up with competition by upgrading the products they offer.
For example, a consumer scoring company specializing in underbanked consumer lending,
L2C Inc., has upgraded its First Score Direct, a tool designed to provide renewable marketing lists for pre-approved
and "invitation to apply" campaigns.
Since 2000, L2C has enabled banks, credit card companies and other lenders to
reach their clients using its customized real-time scoring system, Link2Credit, and First Score Direct. "This
latest product extension was developed in response to the growing demand from our clients for tools for marketing
specifically to underbanked customers," said L2C president Mike Mondelli in a company release. "This
new ability to target the underbanked who have shown interest in specific products generates higher campaign response
rates, increases acceptance rates and reduces the sales costs associated with marketing to this attractive segment."
He believes the option to screen the lists for creditworthiness, "even when
no credit files exist, further increases offer adoption and profitability."
Through First Score Direct, the company enables marketers of financial products
to access alternative data such as checking account activity and performance, short-term loan performance, trade-line
activity for alternative lending tools, demographic and behavioral data, and public record data from over 7,000
federal, county and local jurisdictions.
Using the updated credit scoring system, Link2Credit enables client users to evaluate
the credit risk of 88 million U.S. customers currently with little or no credit history, thus allowing lenders
to reach out to them. The new upgrade adds new data to the marketing lists based on screenings of a wide range
of databases that identify customers' interest in specific financial products and services like mortgages, auto
loans and credit cards. These lists select up to 250 different criteria "to determine which customers they
want to include on their finely targeted ... lists," L2C said. Lists, however, prescreen and include only
customers who meet the marketing campaign credit score requirement.
L2C clients include banks, retailers, publishers and other credit providers.
Besides using specialized providers like L2C, companies can increase the lead
pull-through rate by combining resources. According to Mr. Welbaum, for instance, lenders can simply integrate
their services with the Fannie Mae and Freddie Mac automated underwriting systems to help increase online borrower
approval rates. Also, the pull-through rate can be increased by immediately sending out e-disclosures to the customer.
Rick Schlegelmilch, vice president and market sector manager of Atlanta-based
direct marketing and database solutions provider Choice Point Precision Marketing, said his company is placing"
a heavy emphasis on data analytics" and how they drive lead generation.
CPPM focuses on direct marketing lead generation and lead marketing. For over
two decades, the company has provided direct marketing programs that integrate data, advanced analytics, creative
strategy and scalable technologies offering long-term program results. Its lead generation programs serve over
15,000 independent agents annually, including three of the top seven retail banks in the country.
In recent times the mortgage market has changed significantly, he said, even compared
to one or two years ago. "This is a wild time for our clients."
Rather than going after larger customer groups, lenders are focusing on first-time
buyers, FHA loans and reverse mortgage clients, Mr. Schlegelmilch said. He believes the new trend in lead generation
is that, if until recently lenders were trying to match products with their clients, now they choose to do the
reverse by trying to match clients with products that best fit their financial profiles.
The downturn in the marketplace has affected home values and lenders' need to
utilize multiple data sources in order to come up with a model home value or home-equity values that are more accurate
based on current and historical data. Also, developing so-called lead incubation systems is very helpful.
In addition, he said, direct mail remains the best lead generation drive now that
the list of people on the do-not-call list grows every day. "Direct mail is the best way to drive customers
to a specific website or URL page," he said. The use of database analytics technology has become much more
important because of the subprime mortgage crisis, which has made lead quality even more important than it used
to be when it comes to lead generation management in the long term.
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