customers? Many companies have used television ads and direct mail – perhaps operating under the assumption that seniors aren’t tech-savvy enough to respond to more modern forms of marketing. However, that’s an assumption that’s proving to be false, according to Zach South, president of Best Rate Referrals.
for reverse mortgages
online is a lot cheaper and more effective than you might think. … It’s been the most cost-effective way, the cheapest way,” South said. “And surprisingly, a year or two ago I probably would have given you a different answer, but with our testing and our actual marketing efforts online, we’ve proven that you can generate good business online by targeting these people on Facebook, through email.”
South said his own experience made him realize that the notion of the tech-illiterate senior is largely a myth.
“We decided to put it out there and see if we could break this myth, and we were able to,” he said. “I started thinking about this – and my parents are seniors, and it was right in front of me the whole time – my dad has an iPad, my mom has an iPhone. My mom’s on Facebook, my dad’s always checking his email – so it makes perfect sense that you can attract this type of consumer online, and be very cost-effective.”
Cost-effectiveness is one of the big draws of online marketing. If you’re smart about it, said South, you can target your message like a laser for a fraction of the cost of less effective advertising.
“You’ve just got to do it in a way that doesn’t break the bank,” he said. “For example, if you go on Google and you try and bid on pay-per-click for reverse mortgage information or top keywords like that, you’re going to be fighting against the big boys, and you’re going to be paying $30-plus per click. That can get expensive quickly. Whereas on Facebook, you can do a lot more targeted advertisements. You can actually target people who are over the age of 65 who are homeowners. … If you start looking at other methods like TV commercials or direct mail, they can get very expensive very quickly. And with that type of marketing campaign, you can try and get as targeted as you can, but you’re really just doing a shotgun-type campaign where you’re just spraying it out there and hoping it hits something. Online it’s a lot easier and cheaper to focus your ads on specific individuals.”
But even targeted advertising won’t do you much good if it’s not crafted correctly. You need to make sure your message is clear, easy to understand – and easy to respond to.
“Messaging is by far the No. 1 key. You can have the prettiest website in the world – you can spend thousands of dollars on a web designer – but really, it all comes down to messaging,” South said. “You have to get that messaging, as far as directing the consumer what to do, within the first five or six seconds, because they’re going to make their minds up very quickly. Let’s be honest, senior citizens aren’t online every day like a lot of younger kids are, where they know what looks good and doesn’t look good. So even an ugly website can outperform a pretty website if the messaging’s correct.
“For example, one of the things we like to do is using ad copy around a reverse mortgage calculator: let’s see how much you can receive in a reverse mortgage, either in a lump sum or monthly payments. … You show that data to them after the person enters their home value and their age and stuff like that, and then prompt them, ‘Hey, are you interested in speaking to a reverse mortgage specialist?’ By doing that, it seems that you’ll get a more interested prospect than just someone who calls up and says, ‘I saw your TV ad and I’m interested.’”
Online marketing can also give mortgage originators a better opportunity to engage with their customers – and combat some of the persistent misconceptions about reverse mortgages.
“We see this on Facebook a lot because of the commenting feature. People can comment on your post, and when we read these negative comments, it just shows that the education isn’t out there for these consumers to inform them of what a reverse mortgage really is,” South said. “It’s not that the bank’s going to steal your home or anything like that at all. However, you keep seeing these comments come up. So what we do on our Facebook advertising is when people comment like that, we will start answering those comments with educational information and links to NRMLA, which is the reverse mortgage association. They have a lot of good information out there that they’ve published. We link them to the documents that debunk those myths about reverse mortgages – and in doing so, we’re educating these consumers through our advertisements and trying to flip the script, per se.”
And ‘flipping the script’ is important, because for the right customer, a reverse mortgage can be a godsend. Too many seniors, South said, are living on tight incomes, with no idea they can tap the equity of their homes to ease their financial burdens.
“One of the most shocking things to me is that people who are hitting retirement age don’t have any savings. So now they’re living off of Social Security, Medicare, Medicaid – and that can be very hard for a lot of individuals out there,” he said. “They don’t know that they can still live in their home and reap the benefits of that equity from all the time and heart and sweat they’ve put into that house. That’s why we’re one of the biggest proponents of reverse mortgages – a lot of these homeowners don’t need to live in poverty, just living from Social Security check to Social Security check. They can get an extra source of income, and they’re not having to pay a monthly mortgage payment, either. It seems from the feedback we get for our clients, they’ve helped a lot of people.”
So how do you reach out to potential