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Research Outline
Prepared for Jeff D. | Delivered February 27, 2020
Home Loan - Customer Acquisition Cost
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Goals
To help price a new product that aids lenders and loan officers market to home buyers by researching how
m
u
c
h
lenders/loan officers spend to acquire a new client (home buyer) in the U.S.
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Early Findings
A 2017 report stated
87.9%
of loan officers said referrals are one of their top marketing tools.
47.4%
of loan officers don't spend any of their budget on referrals, but 41.9% said if they had the budget they would put it towards referrals. According to this same study, purchased leads are the top item loan officers spend
$500+
on every month. This was not specific to U.S. loan officers, but was included because of pertinent information.
According to Statistica, for the years of
2018-2020
the U.S. mortgage spenders/loan officer industry spent $99.81 million, $139.13 million, and $180.8 million (projected) respectively on advertising for those years.
In
2018
, banks increased their spending on marketing by 13% to $13 billion in 2018.
Quicken Loans
spent $57.3 million dollars between May 1 and May 31 in 2018 on TV ads. US Bank and Wells Fargo only spent $90,000 and $20,000 respectively on "
mortgage-related commercials
."
Even during the housing recession in
2007-2008
, mortgage companies still spent $409 million on ads in the third quarter of 2007.
Key trends in the mortgage/lending industry for marketing include the use of
collected data
,
use of social media, and online/content marketing
.
Credit unions spend between
$8 and $16
per member on advertising.
Financial Brand
projected that credit unions spend $550 million annually on advertising.
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