Every business faces the same basic challenges.
- “How do I find new customers?”
- “How do I keep my current customers?”
- “How do I get back former customers?”
The challenge is no different for consumer finance lending.
It’s simple, really. Get one of those inflatable dancing tube guys out in front of your store. Everybody loves those guys.
Just kidding. But seriously, everybody DOES love those guys.
Here are five tips that every consumer finance lender should be doing, and how to get it done.
Plain and simple, live checks work. As an instant loan, live checks bring in new prospects and instant loan volume with the first touchpoint. The acquisition costs for live checks are astronomically low, and they are the perfect vehicles for direct mail marketing. The trick is to have the know-how and right machinery to make them work. That’s a lot of money to put out on the street and knowing the proper positive pay file processes (that’s a tongue twister!) is a crucial element. It is worth noting, that experience in this field is essential, as working with someone that doesn’t have the technical expertise could cost YOU a lot of money.
Pre-approved offers and “Invitation to Apply” campaigns
When you have data at your fingertips (or work with someone who does), you can send out an offer to the perfect, targeted group of prospective customers, knowing ahead of time that they are the right fit for your offer. Choosing the right bureau criteria and having the knowledge of how to use the data is how you can make these campaigns successful. In “Invitation to apply campaigns,” data modeling helps identify the right customers, and helps grow new customer acquisition.
Building a relationship and a communications strategy with your customer is crucial, and the lifetime value of a good customer is exponentially higher than that of a one-time customer. How can you achieve this? With renewal programs that help keep the communications stream open, and that encourage each customer to come back and make in-branch visits and introduce them to the latest offerings.
Any “invitation to apply” campaign helps drive ancillary product sales. Car clubs, insurance products, branch merchandising, tax services, and other ancillary services all help with the bottom line, and can provide an important service to your customer in the meantime.
Consumer Finance is the perfect vertical to experiment with QR code mailings, SMS and text communications and online ordering systems. You may not realize it, but your customers ARE using these avenues to communicate, so every lender owes it to themselves to be in the conversation. All of these tools make lending easier, allow customers to have a better experience with your brand, and encourage them to visit you in branch more often.
These five tips are just the tip of the iceberg to what lenders can be doing to enhance their offerings, and represent a jumping off point for really growing a book of business and expanding your lending footprint.
Greg Hamby is one of SourceLink’s Consumer Finance lending experts. Greg is a business partner board member for the American Financial Services Association, and has been involved with lending companies for over 20 years. You can reach Greg at firstname.lastname@example.org