eAdoption is not a new concept, yet the challenge in switching customers to the paperless movement is still impacting financial institutions' bottom lines. Despite the fact that about 85% of the U.S. population uses the Internet, most financial institutions only average 15%-20% electronic adoption rates, which means that there is much room for improvement. Download this white paper or click on the image above to learn about some of today's challenges that are hurting your bottom line- and how to solve them!
Human touchpoints are being eliminated with continual process automation, giving customers direct online and mobile control over their financial accounts. Tasks that once required a customer to walk into a bank or credit union are now carried out through the touch of a finger on a screen or keyboard. In turn, automation is altering consumer expectations, and marketers are realizing that static content is on its way to extinction.
Hotwire PR’s seventh annual “Communications Trends Report” highlights the fact that consumers expect timely, relevant and personalized content in real-time (think Snapchat, Periscope and Meerkat). This trend shows that customers now expect to feel as though they are receiving exclusive content while being a part of instant communication. This means they will be more responsive to personalized dynamic communications on all branded print and digital documents as well. As a financial institution, now is the perfect opportunity to provide real-time messaging to your customers for retention, cross-selling, upselling, and/or utilizing affiliate advertising.
Dynamic Messaging allows you to present strategic messaging to all customers or a specific target group and use consumer-facing marketing space by targeting account holders with products and services that best fit their needs. There are many ways to incorporate dynamic communications on specific customer criteria, including account balance, zip code, gender, or marital status, to name a few. You don’t have to reinvent the wheel in compiling data because you already have it. Why not use it to increase your bottom line?
Here are some tips on harnessing the power of dynamic messaging on customer-facing digital and print communications:
1. Target to individuals, not groups. Not all customers are created equal, so personalization is key! In a recent survey, only 21% of individuals reported that marketing messages they receive are “usually relevant.” This low percentage provides you with an opportunity to stand apart from all of the usual communications your customer receives on a daily basis by presenting them with messaging that is targeted specifically to their needs.
2. ABC- Always Be Changing. If you’re in sales, I know your first thought at seeing that acronym was, “Always Be Closing.” I think these two sayings go hand-in-hand. A colleague of mine once told me, “A static website shows your audience that your organization is static.” The same principle applies to all other customer communications. If your customers don’t see you moving forward with the times, they will be less likely to respond to your brand’s communications. A good practice is to re-evaluate messaging on a quarterly basis to ensure customers stay engaged.
3. Timing is everything. This ties both of the above points together. Say a customer has JUST opened up a savings account with your institution. Would it be wise to send them a document the following month containing an ad with the messaging, “Open a savings account with us?” No. Instead, maybe it’s time to start sending them ads about an auto or home loan.
The opportunities to speak to your customers on a personalized level without any human touch points involved are endless. As customer communications continue to shift, the importance of dynamic communications will continue to increase. To learn more about dynamic messaging, click here.
As the real estate market experiences historically low interest rates, mortgage industry professionals continue to search for a balance to improve the borrower experience, mitigating risk and netting more profit per loan. That said, borrower education before and during the loan life cycle is of utmost importance because it increases borrower buy-in. Heading into Q2 of 2016, we want to share some informative articles that can be useful when educating potential and current borrowers on today’s mortgage lending market:
1. Freddie Mac’s Home Possible Advantage Program Myths and Facts
A recent HousingWire article outlines 6 myths about Freddie Mac’s Home Possible Advantage program featuring a 3% down mortgage payment option. The article also provides a “flashcard” at the bottom for quick reference of myths and facts.
2. 10 FHA Guidelines EVERY Home Buyer Should Know
This blog post from Inlanta Mortgage covers FHA guidelines that home buyers should be aware of, including down payment requirements, maximum loan amount, and debt to income ratio calculations.
3. Kick-Start Your Real Estate Investment Portfolio Using an FHA Mortgage
One of The Mortgage Reports’ recent articles written by finance and business writer, Mark Henricks, discusses ways an FHA loan can help borrowers purchase their first rental home.
4. 10 Terms Every New Homeowner Should Know
This helpful article posted on Real Estate Talk Boston gives new homeowners some tips on credit repair, as well as important lingo to learn such as fixed rate loan, adjustable rate loan, escrow, and more.
There are many ways to share the above articles, as well as other pertinent information, with potential and current home loan borrowers. A best practice would be to communicate updates and helpful tips via your company website, as well as all borrower-facing digital and print documents.
What are some helpful tips you would share with potential and current borrowers in today’s market?
According to Dealogic, mergers and acquisitions (M&A) in 2015 reached an all-time high with a volume of $4.9 trillion. Companies merge and are acquired for many reasons, including product/service line expansion, consolidation for lower administrative costs, increased profits and even eliminating competition.
Credit unions value reliable document outsourcing vendors that help them reach and exceed their stated goals such as member engagement and retention. Those goals are jeopardized when an acquisition occurs. Below are some ideas to be aware of in the event your statement outsourcing vendor is in the middle of an acquisition:
Mix of Competencies
The idea of an expanded products and services offering is enticing, however, it can easily backfire. Say, for example, a direct marketing company acquires your statement processing vendor. The acquirer may continue to support and expand your document vendor’s products and services, but they may also extract pieces of the original product and discard key tools that have helped your credit union streamline efficiencies. Also, while marketing through business-critical statements can help drive revenue, the acquiring company’s competencies do not include the industry expertise necessary to identify ways of maximizing customer communications through member documents.
Lack of Investment in the Future
As a result of your vendor’s efforts to expand upon their products and services offering, they may be shifting focus away from investing in future tools to streamline efficiencies and improve upon the member experience. While this may not have an immediate effect on your statements, it can impact your credit union’s bottom line long-term by putting it behind the curve on meeting member expectations.
According to Credit Union Journal, 67% of banks report that they are targets of significant cyber attacks daily or weekly. Therefore, third party vendor management is of utmost importance in preventing data compromise. This is especially crucial for your statement processing vendor, as they not only have access to all member data straight from your core, but are also responsible for composing and delivering this data. If data falls into the wrong hands because of a roadblock in your vendor’s acquisition, it will ultimately fall back on your institution and affect compliance, resulting in fees.
Customer Service Falls
Most vendors tout customer service, and yes, many statement processing vendors do excel in this category. However, if a vendor is in the middle of an acquisition, customer service may suffer due to the focus shifting to operational reductions, removing attention from the existing customers’ immediate needs. As a result, you as the customer experience inadequate communications and lack of transparency. It is important to feel comfortable in knowing your questions and escalations will be resolved in a timely manner before the production and delivery of your customer documents.
Wrapping it Up
When choosing a third-party vendor, it is important to do your research. Ask them what their financials look like and if they have any plans of acquisition. While this isn’t 100% foolproof, it can better prepare you to find the right statement processing partner.
Interested in learning more about third party vendor management and how to choose the right statement processing vendor? Click here.
It’s the beginning of March, the last month of Q1 and the month where the spring season begins. As you ramp up for Q2 and the change in season, we want to provide some reasons as to why your business-critical documents need spring cleaning:
Are your loan profit margins declining every year? If the answer is “yes,” you are not alone. This is a common challenge in the servicing industry, as outlined by the Mortgage Bankers Association’s Vice-chairman J. David Motley in his opening remarks at this year’s MBA National Mortgage Servicing Conference:
“But we've never experienced the kind of prescriptive, regulatory requirements that have been imposed on us over the last two to three years. In 2012, our delinquency rate was just over four percent. We never got above six percent, even in 2009. Our cost per loan serviced went from $130, a new high at the time, to $195 this year. Not because of increased defaults. In fact, our default rate has dropped to 3% overall. The increase in cost was primarily due to increased expense associated with new regulation and the people, systems and process changes necessary to implement those regulations.”
Motley later in his speech said: “In the Consumer Financial Protection Bureau, we have a new regulator with unprecedented oversight authority. The Agency has instituted thousands of pages of regulations that affect the way we do business every day. Implementing the servicing rule's requirements necessitated system changes and staff training which had an incredible impact on our business operations, and bottom line…duplicative and overly burdensome state regulations are presenting new layers of complexity for servicers and consumers.”
As a result of the aforementioned regulatory changes, mortgage servicers have had to hire additional compliance staff and hone in on third party vendor performance. Of course, these actions are going to negatively affect the bottom line. While compliance is necessary for the protection of each homeowner’s rights, servicers are understandably seeking ways to turn a profit while meeting compliance.
With the overarching theme of compliance at the MBA Mortgage Servicing conference, the Lanvera team heard the same six resounding questions from servicers:
1. How can I maintain compliance on all statements, letters, notices, and other documents?
2. What are some best practices in avoiding lawsuits?
3. How can I net more profit per loan?
4. Are there any other ways I can increase eAdoption and decrease print and mail costs?
5. How do I reduce my call center volume?
6. What are some ways I can improve the borrower experience without cutting into my margins?
Now consider this: What if you had transactional document solutions that could save you up to $5-7 per loan annually, net an additional $3-$11 per loan annually, reduce call center volume, increase eAdoption, improve the borrower experience, and maintain compliance on all statements, letters, notices, and other documents? Sound too good to be true? It’s not! Click here to learn more.
While regulatory pressures continue to escalate, mortgage servicers have to remain compliant while keeping margins at a reasonable level.
According to The Worthington Daily Globe, people in the Worthington, MN area received a phishing text that looked like it came from Fulda Area Credit Union (FACU) claiming a discrepancy or problem with the recipients’ accounts on Monday morning, February 15, 2016. Upon further investigation, these SMS messages were from scammers who targeted both members and non-members, indicating there was not a breach in FACU’s core, but rather a purchased list of phone numbers.
“It seems to be a classic phishing attempt where they just target a group of phone numbers trying to get information,” said Laura Honken, vice president of operations for Fulda Area Credit Union (FACU). “It just seems they’ve probably purchased a block of phone numbers and started out with that.”
Although Monday was a federal holiday, FACU employees acted quickly in order to ensure that their members and potential members’ information is safe and the brand is protected.
“It is our priority to make sure that if anybody did click on that, we are getting them protected as soon as possible,” Honken said.
Aside from immediately reporting the scam to authorities and cell phone carrier fraud departments, FACU employees started closely monitoring the credit union’s official Facebook page to field member questions, as well as answered the phones at the Fulda and Worthington locations.
As new details are sure to unfold, we want to first give kudos to FACU employees for their proactive approach in helping members and non-members ensure data safety. Secondly, we want to provide some quick tips on how to quickly and effectively communicate emergencies to members:
By December 2015, credit unions saw massive growth in auto loans with balances projected to reach the highest to-date: $264.7 billion, according to Callahan & Associates. Furthermore, credit unions bagged 16.5% of the auto market, which is the highest year-end rate since December 2009 at 19.9%.
In an effort to aid credit unions in their continued pursuit of auto lending portfolio growth this year, here are some ways to utilize member-facing documents to meet this strategic goal:
Segment Your Audience
Because there is no such thing as a cookie-cutter member, standard marketing will not produce the same response rate as segment marketing. According to MailChimp, segmented email campaigns see 59.99% more clicks than non-segmented campaigns.
Incorporating targeting and personalization in your documents using business rules and workflows provides the ability to significantly improve your print marketing ROI.
Make it Easy to Respond
Many credit unions fall into the trap of creating extra, unnecessary steps for members to take in the pursuit of auto loans. Get ahead of your competition by making it easy for members to respond! A great way to do this would be to post a URL in the members' ePresentment documents that will drive members to a page where they can fill out a quick form in order to be contacted by one of your loan officers.
Communicate Risk Mitigation with Credit-Impaired Members
Mitigating risk, especially when lending to credit-impaired members, is of utmost importance to credit unions. Ensure your institution is covered by insurance that helps protect collateral or loan repayment, and then build that cost into those specific loan rates. In order to effectively communicate this with your members without causing uproar, utilize member documents to prominently communicate the increase in loan rates- and the reasoning behind said increase. Your members will appreciate the communication and will feel good knowing that you are working with them to better their overall financial standings.
Your core focus is your members, so effectively communicating with them on every level, especially on member-facing documents, is of utmost importance. Partnering with a document outsourcing company that can design, produce and deliver business-critical content on any platform is critical to portfolio growth.
Member-facing documents are the perfect delivery method for your auto loan portfolio initiatives. By personalizing messaging, alleviating the customer response cycle, mitigating risk, and choosing a document outsourcing company that aligns with your strategic business goals, your credit union will be well on its way to seeing an expanded portfolio.
Steve Jobs unveiled the Apple iPad on January 27, 2010
On this day in 2010, Apple’s late Co-founder, Chairman and CEO, Steve Jobs, went on stage at the Yerba Buena Center in San Francisco to debut the first ever Apple iPad. In an article the day after the device was unveiled, CNN described it as the “missing link” between smartphones and laptops.
Fast forward to March 2, 2011, where the iPad 2 made its way to the marketplace with a nicer design that introduced the magnetic Smart Cover and front and rear cameras. The following March, the 3rd generation iPad was announced. This time, the change was a high-resolution “Retina” display, which was a widely requested feature among consumers. Since then, we have seen the iPad mini 1, 2, 3 & 4, 4th generation iPad, and iPad Air 1 & 2 and iPad Pro (I think I have covered them all!).
As a tribute to the 6th anniversary of the iPad, we want to share with you some lessons from the evolution of this multi-million dollar generating device:
1. Listen to Your Customers
One of the main goals of gathering customer feedback is to enable communications between your organization and the customer. Opening that line of communications allows customers to express their thoughts and/or ideas while giving you the opportunity to identify ways to improve the customer experience. Apple accomplishes this with an iPad product feedback webpage, where customers are directed to submit their comments. Financial institutions have the opportunity to promote customer feedback on all business critical documents, whether print or online.
2. Implement Changes Based on Customer Feedback
Executives at Apple made adjustments and created different versions of the iPad based on customer feedback. The result? More units sold each time a new version was released. Many financial institutions ask for customer feedback, but implementing changes in response is a whole different ballgame . According to Help Scout, if a company resolves a complaint in the customer's favor, they will do business with that company again 70% of the time. So rather than allowing customer feedback to disappear into a “black hole,” take time to strategize and create ways to improve the customer experience- and watch your revenue grow.
3. Brand Consistency is Critical
This goes without saying, but we are going to say it anyway: everyone knows that Apple is the creator of the iPad. Furthermore, all of the iPad product line is labeled as such. While there are other tablet brands on the market, no one mistakes an iPad for a Samsung product. Financial institutions that implement brand consistency across the entire organization offer customers consistency in exploring all products and services offered.
4. Quality is Key
Quality in products, services and all business-critical communications goes hand-in-hand with customer feedback and brand consistency. The iPad product line was the brainchild of Steve Jobs, who was very adamant about putting quality products and services on the market. “When you’re a carpenter making a beautiful chest of drawers, you’re not going to use a piece of plywood on the back, even though it faces the wall and nobody will see it. You’ll know it’s there, so you’re going to use a beautiful piece of wood on the back. For you to sleep well at night, the aesthetic, the quality, has to be carried all the way through.” –Steve Jobs.
Financial institutions that keep this ideal top of mind rather than implementing “quick fixes” will more likely see better retention rates and increased revenue in years to come.
Happy Anniversary, Apple iPad!
Mortgage industry professionals are increasingly experiencing regulatory changes while trying to balance portfolios. The “do more with less” mentality in the industry has sent loan servicers on the search for ways to increase their profit per loan. At Lanvera, we understand the importance of revenue growth per loan and would like to share some steps you can take to expand the value of your portfolio.
In Segment Marketing, a borrower base is divided into groups of individuals that are similar in specific ways relevant to customer attributes such as age, gender, interests, spending habits, etc. According to MailChimp, segmented email campaigns receive 14.72% more opens and 62.84% more clicks than non-segmented campaigns. What does this mean for your portfolio? Borrowers are more receptive to information that is specific to them.
Lanvera helps increase revenues by providing the ability for our clients to sell affiliate marketing space to businesses that offer services similar to borrowers’ needs. Segment affiliate marketing in borrower-critical document delivery can be applied multiple ways:
· Present a marketing page to borrowers as they sign on to access their statements. Information such as marketing promotions or inserts can be utilized for maximum exposure and increased calls to action.
· Utilize digital onserts to optimize workflows and segment borrowers groups with particular offers most beneficial to the individual. Digital onserts are clickable, providing instant access to landing page promotions and a faster way to drive intended borrower behavior.
· Capitalize on multichannel expanded hyperlinks by including links to webpages and offers from directly within individual electronic documents. Interactive links provide borrowers easy and instant access promotional content.
The benefits of personalized marketing are enormous to both borrowers and servicers and can impact profit per loan significantly. As a partner, Lanvera helps to maximize borrower communications through segment marketing, resulting in improved ROI and higher e-Adoption rates. Click here to learn more on how you can net more profit per loan.