The lockdowns of 2020 have accelerated the adoption of digital channels by as much as five years. When potential clients change how they interact with their financial providers, banks are prompted to act. They have to adjust their mortgage distribution strategy to maintain or increase the level of leads and therefore mortgage volumes. Online and mobile channels are finally starting to live up to their potential. For example, the percentage of clients taking out mortgages online has increased around 15 percentage points compared to pre- COVID – a trend that is expected to continue. Similarly, phone and video advisory has finally made a long-awaited breakthrough.

Client personas help to provide the view from outside

Client journey mapping is key to identifying pain points and possible “hidden” distribution channels in the customer journey so as to define levers to increase leads. We have divided clients into four segments based on whether they are already a client and whether the mortgage replaces another or is new (see Figure 1). Within those segments, we have created different personas based on our experience. Let’s have a closer look at Tim Meier, who is looking for a self-occupied apartment for his small family. He is the standard ROPO-persona; research online, purchase offline.

Figure 1: Every segment has its own client persona with different client journeys

Try to establish touchpoints early in the customer journey

Figure 2 depicts Tim’s journey to buy a property. Along the path are various touch points where banks can establish themselves as the trusted partner of choice. We have identified four stages relevant for effectively generating leads, two of them before the usual first point-of-contact with the bank.

1. Information gathering: Tim gathers information mostly online, where he uses mortgage calculators and other useful tools to assess his financial situation and checklists what to do before buying a property.
2. Finding a property: Tim loves flicking through online ads on a meta-search website, where he finds all publicly available ads for apartments.
3. Finding a financing partner: He finally discovers a buying target online. After a brief discussion with his wife, they meet the real estate agent who suggests contacting a mortgage broker.
4. Buying the property: After consultation with the mortgage broker, the couple buys the property with a mortgage from a cantonal bank outside their canton of residence and the mortgage broker even takes over the administrative processes for the couple. What a service!

Tim is more than happy with his new financing partner. His old retail bank did not provide high-quality service. Tim was flagged as a retail client and his main touch point was the call centre, where he suffered chronically long waiting times and insufficient advice.

Figure 2: Tim’s client journey to buy and own a property

Pulling the right levers can substantially increase your leads

Figure 3 illustrates that generating more leads can happen not only with lead partnerships (such as mortgage brokers, online marketplaces, real estate agents or developers), but also through the dimensions of service enhancement and the marketing-mix. For every type of lever, we have researched and elaborated on how to generate more leads to increase mortgage volume.

Figure 3: Example of levers to quickly improve your lead management

Successful examples in the market show potential direction lead generation can take place in the “digital new normal”:

• Online marketplace: One of the top three cantonal banks established a long-term partnership with one of the leading online marketplaces for real estate. This made it possible not only to easily compare mortgage rates for different offerings, but also to use the marketplace as an online mortgage service to close new mortgages or replace existing ones. Although online mortgages currently only account for 3.1% of newly closed mortgages, strong growth rates suggest a continuous and sustainable increase in distribution share.
• Mortgage broker: A small cantonal bank in rural Switzerland actively seeks cooperation with mortgage brokers to establish a wide network across Switzerland, both online through mortgage platforms and offline through classic brokers. While mortgages are not high-margin business, the bank is able to diversify its credit portfolio and client base across Switzerland. In addition, the bank develops vital capabilities to navigate successfully the emerging digital ecosystems around the house-buying journey. The market share of brokers is still relatively small in Switzerland (estimated at around 1-2% of the total market). In a survey¹ from the Institute of Financial Services Zug (IFZ), respondents mentioned lack of trust as the main reason for not choosing a broker. Time will tell whether brokers manage to build trustworthy brands and catch up with the large market share in our neighbouring countries.

Tim’s client journey is only one of many. Mapping out the path to buying and owning a house is a key step in identifying new touchpoints. The adoption of digital distribution channels has increased substantially, implying that a strategy review including adjusting the right levers is due. For further information or discussion, do not hesitate to contact our experts at Deloitte to support you in boosting your mortgage leads in the “digital new normal”.

¹ https://blog.hslu.ch/retailbanking/2019/01/14/welche-kunden-gehen-zum-hypothekenvermittler/

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