Over 73 per cent of Australian customers are likely to use the same broker for a second mortgage i . It's a great statistic, but you shouldn't take customer loyalty for granted.
You've probably heard the saying that attracting new clients can be five times as expensive as keeping old ones.ii It's regularly used in discussions about the importance of customer retention. Yet it only scratches the surface on the benefits of customer retention as a growth strategy and the positive long-term impact it can have on your business.
From the obvious addition of value through increased revenues, research has also indicated that loyal customers can have a ‘ripple effect’iii. Reducing costs, increasing sales through a word-of-mouth communication and more are all important advantages to keeping your customers close even after a sale. Research conducted by Deloitte also indicates that 32 per cent of mortgage broker customers chose to work with a broker based on personal relationships or recommendations.
While firms have been working to create new avenues for retention, research has also pointed out that there needs to be more thought put into what matters to the customersiv. Tailoring your services to provide after-sales support that customers value could provide a long-term benefit to your sales pipeline. Here are a few tips that can help you offer better after-sales service that can build loyalty and trust.
Showcase your expertise and your knowledge
It's official. The reason why customers approach mortgage brokers as an option for financial advice is that brokers are experts in their field v . If you’re already looked on as someone who gives great financial advice, why stop?
Work to stay in regular touch with clients, clueing them in on industry developments or changes that might affect them. You can use automated methods to do this but try adding a personal message occasionally. If there is a relevant tax benefit or a change in regulations that might affect a particular customer's finances, dropping in a note will reassure them that you are looking out for their interests. Know what is going on and how it can help your customers will go a long way in keeping their trust alive while also making your service more likely to be sought after again.
Consider what customer needs might be or how their situation may have changed and provide them with advice that may apply. According to Deloitte, 60 per cent of broker customers valued ongoing interactions and advice from their brokers even after settlement.vi Make sure you communicate regularly and your communication is personal and personable. Consider a small gift on the anniversary of their home purchase as an investment in maintaining and furthering your relationship. By doing all this, you can set a high after-sales service expectation which can make your customers more likely to return to you, or even recommend your services to someone they know.
Be transparent, concise and clear whenever dealing with clients
Dedicate time to customers after the sale and not just in the immediate aftermath of the purchase. Over 40 per cent of mortgage broker customers received ongoing advice from their broker even after the sale. Make sure you are among this group.
Always ensure you take the time to answer their questions or find someone who can. A timely, clear, and concise response will enable them to think of you as a resource that can be returned to, reinforcing their trust in your ability to make the best decisions regarding their mortgage. It may also make them more likely to refer you to friends and colleagues.
Following these tips will help build trust but it is important to ensure that you don't go overboard. Maintain contact, but also be mindful of customer needs and privacy. Ensure that you are consistently available to them without reaching out too many times. Building trust is a long-term process: returns are not going to be immediate but they will be significant when they do arrive!
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- Deloitte 2016, Customer Experiences of using Mortgage Brokers - Market Report prepared for the Mortgage and Finance Association of Australia, p. 5, https://www2.deloitte.com/content/dam/Deloitte/au/Documents/financial-services/deloitte-au-fs-home-loan-preferences-041116.pdf#page=5, viewed 7 August 2017.
- MPA Magazine 2017, Why customer retention is crucial, http://www.mpamagazine.com.au/sections/business-strategy/why-customer-retention-is-crucial-230186.aspx, viewed 7 August 2017.
- Gremler, D. and Brown, S. 1988, The Loyalty Ripple Effect: Appreciating the full value of customers, International Journal of Service Industry Management, http://www.gremler.net/personal/research/1999_Loyalty_Ripple_Effect_IJSIM.pdf, viewed 7 August 2017.
- Hamilton, R., Rust, R. and Dev, C. 2016, http://sloanreview.mit.edu/article/which-features-increase-customer-retention/, MIT Sloan Management Review, Which features increase customer retention , viewed 7 August 2017.
- Deloitte 2016, Customer Experiences of using Mortgage Brokers - Market Report prepared for the Mortgage and Finance Association of Australia, p. 16, https://www2.deloitte.com/content/dam/Deloitte/au/Documents/financial-services/deloitte-au-fs-home-loan-preferences-041116.pdf#page=16, viewed 7 August 2017.
- Deloitte 2016, Customer Experiences of using Mortgage Brokers - Market Report prepared for the Mortgage and Finance Association of Australia, p. 20, https://www2.deloitte.com/content/dam/Deloitte/au/Documents/financial-services/deloitte-au-fs-home-loan-preferences-041116.pdf#page=20, viewed 9 September 2017.