By David Lykken
Special to MPA
On my Lykken on Lending radio show, I recently had the opportunity to interview Peter Froberg of freemium.org on the concept of "freemium.
In a nutshell, the "freemium" business model requires giving away part of your offering for free in hopes that customers will be eventually purchase another part of your offering--the premium.
What does "freemium" have to do with the mortgage business? Well, while technology companies are most well known for using the model, organizations in any industry can use the concept.
People are attracted to free. They respond to free samples, free trials, free consultations, etc. In the mortgage industry, "free" is anything of value you give away without requiring a purchase. What do people get from you that they aren't paying for? That's the very thing that can make all the difference.
What do customers in our business want? The want the means to get into homes. But, they want more than that, don't they? They want to understand how to budget, what it's like to be a homeowner, how to save for the future, and so on. We have resources, both within and outside our organization, that can help us in answering these questions.
We can't give away loans for free, of course. But we can give away education. We can teach our customers things they need to know about owning homes. Free education can be powerful. What are you teaching your customers?
David Lykken is 40-year industry veteran who consults on virtually all aspects of mortgage banking. David hosts a successful weekly radio program called “Lykken On Lending” (www.LykkenOnLending.com) that is heard each Monday at noon (Central Standard Time) by thousands of mortgage professionals.