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MARKETNG OF HOME LOANS STRATEGIES credit union loan marketing is in a state of evolution.

Its changing from simple product promotions to sophisticated segmentation strategies. Judy Tharp believes credit unions have made great strides in marketing during the past four years, chiefly due to member segmentation, the Web, and a variety of delivery channels.Tharp is vice president of solutions development,CUNA Mutual Group,Madison,Wis. She recently reviewed top credit union loan marketing strategies for the 2004 Credit Union Excellence in Lending Awards, a competition the CUNA Lending Council and CUNA Mutual Group sponsor.Five years ago marketing was more productfocused, she says.Credit unions have raised the bar in terms of marketing strategically rather than just doing product promotions.Another observation: Many credit union marketers are turning to sophisticated segmentation strategies to understand members needs, notes Michael Knapstein, president,Waldbillig & Besteman (W&B) Advertising,Madison, Wis., a judge for the CUNA Marketing & Business Development Councils 2005 Diamond Awards competition (see supplement of the 2005 winners in this issue). Theyre mining their databases,identifying members lifestyle segments, and doing very targeted marketing.Credit unions increasingly seek technology tools to guide them. MCIF [marketing customer information file] systems are the primary tools credit unions use to identify their best marketing candidates, notes Chris Braccia, director of product marketing at Harland Financial Solutions, Lake Mary, Fla. Harland, a Credit Union National Association (CUNA) strategic alliance provider, offers Touch Analyzer, a component of its Touch customer relationship management system. Credit unions use MCIF systems to query their databases,run statistical models, and generate lists of members or potential members likely to need specific loan products. The systems use demographics, financial services data, and credit scores to identify likely members and group them into households by address.MCIF systems also help credit unions track their marketing success (Measuring marketing effectiveness, p. 34). Mike Weber, vice president of marketing and public relations at $345 million asset Dupaco Community Credit Union, Dubuque, Iowa, recently used an MCIF query to identify likely candidates for a new auto-loan direct mail campaign. Were targeting members age 18 to 45 who dont have a car loan and who live in our primary area, excluding those weve turned down for a loan in the past year. I ran the query and identified between 5,000 and 6,000 households, says Weber, vice chairman of the CUNA Marketing & Business Development Council. Member segmentation After identifying a key membership segment, some credit unions use MCIF systems to create personalized direct mail pieces. Knapstein says a client

recently developed a series of auto-loan marketing pieces.The project segmented members by the types of cars they thought theyd be interested in. A younger person might receive a personalized piece showing a car that cost less than $25,000, while an older person might get a piece picturing an SUV [sport utility vehicle] that cost $40,000.Some credit unions also download member information from an MCIF to their e-mail systems.Theyre combining e-marketing and member segmentation,says Tharp. One credit union identified five member segments. For example, one was driven by the lowest rate, another by the lowest feewhatever the members propensity is. The credit union sent a different loan offer to each group, targeted to its likely buying behavior.Also, now people are looking at channel management, integrated marketing through electronic channels such as home banking programs, voice response units, automated teller machines [ATMs], and kiosks, adds Braccia. Its the next step in the evolution of target marketing. When a member uses an ATM or other electronic channel, a message is transmitted to the credit unions MCIF, which identifies its marketing profile. The screen displays an offer designed to appeal to you with an appropriate rate, says Braccia. With direct mail, members receive messages at times when theyre not necessarily interested in doing business, Braccia continues. But if theyre logging into home banking, their mindset is on financial services.What better time to make an offer Innovative marketing Tharp and Knapstein point out many innovative credit union marketing strategies while judging national credit union competitions. Some examples: _Indirect marketing, in which credit unions partner with companies to get referrals. For mortgages, a credit union might partner with a realty company. The partners list each others logos on their Web sites and refer members to each other. Some credit unions even locate loan officers in realty offices to handle mortgage financing on the spot. One invites real estate agents to a monthly Breakfast of Champions to network and get referrals. _Combining education with marketing. Credit unions are offering firsttime home buyer seminars, one hosts a weekly radio show with other vendors such as an appraiser and a real estate agent, and another has developed a mortgage booklet that walks borrowers through the process of finding the best deal. It doesnt just discuss credit union products. These strategies engender member goodwill while raising awareness of credit unions loan offerings. _Regional pricing, in which credit unions customize loan prices for different cities based on market research.

_An online lending decisioning package, a consulting system that delivers a credit unions product message clearly and consistently while it asks members questions and helps them decide what type of loan they need. _Relationship pricing, which offers members better rates if they have multiple services with the credit Union\

1) BANK OF AMERICA Since joining Bank of America in 2004, Aditya Bhasin has managed consumer marketing for a variety of financial products, including mortgages, home loans and real estate. He has also overseen brand and relationship marketing initiatives. Currently, Bhasin leads marketing strategies for Bank of America Home Loans & Insurance and Bank of America Consumer, Small Business and Card Banking. Bhasin spoke with eMarketers Lauren McKay about how the bank views digital. eMarketer: How does Bank of America break down its digital marketing budget? Aditya Bhasin: We dont think about a separate digital budget anymore because our customers dont think that way. For a particular product launch or campaign we think about how much money we want to spend and then we look for the best tactics to deliver that message. In some years that may mean its a little more TV, and some years we may flex up the digital spend. It depends on what the business needs are and what tactics fit best. eMarketer: Separate digital budget or not, Bank of America is doing a lot in the online space. Can you provide an overview? Bhasin: When Bank of America runs a television campaign, we try to echo that message in digital. So, youll see display advertisements in contextually relevant places. We run a very sophisticated search platform and were constantly optimizing our search keywords. Advertising on our site,, is another important piece of our media mix. When we think about mass-media efforts to get our message out, digital is an integral component. eMarketer: What success have you had with on-site advertising?

Bhasin: We think of it as an important part of our media mix, because consumers who visit the site are in the mindset for financial services. is the 28th most visited website in the US, and its the second most visited financial website. On the homepage, we run a big banner ad that promotes one of our own products. Once a customer authenticates and we know who they are, we can target them with more relevant offers. Through a variety of targeting techniques, we know what sites they have visited within We also know some of their financial attributes, and we can use our natural targeting models to determine what product or service to offer. For example, if a customer has a high balance in her deposit account and doesnt already have an investing relationship with us, she would see an offer for our Merrill Edge product, which helps customers with their investments. Because the customer is in that mindset to make financial decisions, shes much more likely to click on it. We want good quality new customers who are going to bring us high balances and who are looking to have a deep relationship with us. We want to have conversations with customers about how they bank, how they invest, whether they own a home and whether they will need a mortgage. These conversations are important, but they are difficult to have with prospects. eMarketer: Can you provide any specific examples of how Bank of America is integrating offline programs with digital tactics? Bhasin: A few years back we relied on direct mail almost exclusively to market our credit cards. To give you a sense on how things have changed, at the end of last year, we ran a fully integrated program around our Cash Back Rewards Credit Card. Our value proposition on our Cash Back Rewards card is that its clear, simple, transparent, and you get what you want every time. Were taking an integrated approach that we think is aligned with how our customers consume media. Weve invested in a display program that advertises our card rewards program in major portals where customers research credit cards. We are active in search and emailand we view those messages as accretive. Counting all the aspects, theres mass media to support the program; theres direct response if the customer is in the search mode; theres physical mail; and then there is merchandising in the stores. We know that customers may see a message in an online channel, but they might not be

ready to make a decision at that point. Later they might receive a piece of mail with the credit card offer, but it isnt until they are in the store that they see a display and ask a representative about the 1% cash-back card. So, its important that we are in all of these channels. eMarketer: This is a long purchase cycle. How does this affect your marketing tactics? Bhasin: A financial purchase is rarely spur-of-the-moment. Customers shop for a home loan for quite a while and theres a lot of research involved. The same goes for searching for a credit card with the best rewards program, or for a retirement plan. Given the amount of time that can elapse between research and decision-making, we use the digital platform as a means for continuous customer communication and education. We turn to the search platform to ensure we are in the consideration set when customers are searching. We know that when customers are thinking about refinancing, for example, they often start their searches on Google or Bing. So, were managing a portfolio of search keywords for areas that could generate demandfor example, refinancing, credit cards, retirement accounts and college savings plans. We also are sponsoring content on Yahoo!s personal finance site, Financially Fit. This is another way to be in the customers consideration set when theyre thinking about financial services. We want to build rich content that isnt heavily sales-oriented. Another good example of this is the Bank of America Home Loan Guide. On the Home Loans landing page, we have built an interactive tour of the entire home loan consideration process and how much a person could comfortably afford. We walk customers through a series of targeted questions, tools and calculators that lead to a place where they can make an informed decision. Thats when we step in to market our home loan services and say, If you want to apply for a home loan through Bank of America, heres an online application. You can also call us, or visit a store. 2) HERALAD SONS THE banking sector has cornered its biggest share of the Australian mortgage market since records began, official data indicates.

And non-bank lenders have suffered their worst performance since entering the market 16 years ago as banks, armed with more and deeper sources of funding, steamroll their smaller rivals. Government statistics released this week reveal that non-bank lenders, who sell loans predominantly through mortgage brokers, claimed just 1 per cent of the home loan market in April. Banks carved out 92 per cent of the mortgage pie -- the sector's biggest market share in Australian Bureau of Statistic records dating back to 1975. Mortgage brokers yesterday seized on the statistics to again call for the Federal Government to reverse the ban on home loan exit fees due to come into effect in three weeks. Industry lobby group The Mortgage & Finance Association of Australia has warned that the ban on "deferred establishment fees" will heap more pain on the non-bank sector. Chief executive Phil Naylor said the fees had historically enabled non-bank lenders to cut profit margins on home loans, ushering fierce competition into the market. At its height in 2003, the non-bank lending sector -- made up of a host of players including heavyweights FirstMac and Resimac -- had cornered more than 15 per cent of the market. Of the $13.8 billion finance offered by lenders to home buyers in April, building societies -- once a force in Australian mortgage lending -accounted for just 2.2 per cent. And credit unions had 4.9 per cent of the market, according to the Australian Bureau of Statistics housing finance data. "Clearly there is (now) no meaningful competition across the industry and smaller lenders are being squeezed further each month," Mr Naylor said. "We urge the government to either drop the exit fee ban altogether, or . . . exempt non banks from the new regulations". The Mortgage & Finance Association of Australia this week launched an advertising campaign pushing for the about-face in government policy. Treasurer Wayne Swan has said exit fees -- charges payable by mortgage customers who pay out their loan within the first four years -- act to lock customers into their existing contracts, undermining competition.

The statistics published this week do not reveal the share of the mortgage market cornered by the "big four". 3) About AK Marketing Home Loan Agency Hyderabad Offering housing loans from multiple banks We understand how special a new home is for you; Our services will help you finance your dream home. Loans from 5 Lacs to 10 Cr we deal with multiple banks to get the best solution for you. Home Loans in Hyderabad made simple by AK Marketing We as one of the leading home loan service provider, we understand how special a new home is for you and our service will help you lay the foundation for your dream home. We offer you the most convenient home loan plans available with different Banks to suit your needs. With so many attractive features in every type of home loan we offer, creating the home you always wanted is no longer a distant dream. Salient Features of our housing loan service are as follows: Guidance through out the home loan process Home loan amounts suited to your needs Home Loan tenure upto 20/25 years for Resident Indians and 15 years for NRIs Simplified documentation Sanction approval without having selected a property. No matter what the requirement, we have an appropriate plan for you Get the best deals We offer Housing Loans from 5 Lacs to 10 Cr. We offer unbeatable benefits to ensure that you get the best deal without any hassles. While you decide upon a house that suits your family, let us help you with a home loan that suits your pocket. With not just a low rate of interest, but also an unmatched level of service

Our services can be availed for obtaining Homeloan from ICICI Bank Limited., Dewan Housing Finance Limited, India Bulls Housing Finance Limited., Citibank and Axis Bank Limited

4) RBI NEW CLAMP ON HOME LOANS The Reserve Bank of Indias latest notification to banks, to exclude stamp duty, registration and like charges while calculating the value of a property they intend to finance could lead to a further decline in home sales in the lower and medium segments, say developers and consultants. The notification effectively means home buyers would have to arrange for more funds on their own, as banks will not lend for these charges any more. Home loan borrowers are already stretchedProperty prices are high, interest rates have peaked , stamp duty and registrations are high in many states and job markets are also not that great. I think buyers of homes in the Rs 20-70 lakh bracket will get hit further and sales in this segment could fall by a further five to 10 per cent, said Sanjay Dutt, chief executive, Jones Lang LaSalle, a property consultant. In December 2010, to check what is believed was excessive lending to real estate, RBI said commercial banks could not lend more than 80 per cent of the value of a property for loans above Rs 20 lakh and not for more than 90 per cent for loans below Rs 20 lakh. On Friday, it observed that some banks include loans, stamp duty and registration and documentation charges in the cost of a house property. This overstates the realisable value of the property, as stamp duty, registration and other documentation charges are not realisable. Consequently, the margin stipulated gets diluted, RBI said. Hence, banks should not include these charges in the cost of the housing property they finance, it said. RBI wants to curb speculation from real estate and want only genuine buyers in the property market, said Dutt of JLL. In Maharashtra, stamp duty, registration and like levies constitute 10 per cent of the cost of a property. While stamp duty is five per cent of the value, registration charges are one per cent, value added tax another one per cent and service tax another 2.6 per cent. If home buyers have to pay more, there will be an impact on home sales, said Paras Gundecha, president of the Maharashtra Chamber of Housing Industry. Already, property sales in most cities are on a decline due to stagnating incomes, high property prices and rising interest rates. According to PropEquity, a real estate research and analytics company, absorption of homes in the National Capital Region came down from 55,372

units in 2010 to 25,623 units in 2011, a decline of 53 per cent. In the Mumbai Metropolitan Region, the aborption came down by 57 per cent in 2011, compared with 2010 figures, it said. Developers are worried that the new regulations could create more negative sentiment in the market. Too much of regulations always create negative sentiment among banks and borrowers, said Lalit Kumar Jain, president, Confederation of Real Estate Developers Associa-tions of India. However, Deepak Parekh, chairman of HDFC, the country's biggest mortgage lender, does not think the new notification will have any impact on home sales. So far, individuals used to put in 20 per cent of own money. Now they have to bear the stamp duty and registration from own pockets. I think borrowers can do that without much issue, he said.