Key facts
- Direct mail is an effective marketing strategy for reverse mortgage professionals targeting senior homeowners.
- 78% of individuals aged 55 and older read their mail the same day it arrives.
- Direct mail generates $58 in revenue for every dollar spent, a higher ROI than paid search ($19) and email ($7).
- Postcards have an average response rate of 5.7%, compared to 4.3% for letter-sized envelopes.
- Marketing campaigns should target homeowners aged 55 and older.
- Companies should aim to respond to 100% of consumer calls within 24 hours.
Reverse mortgage professionals should consider direct mail as a viable marketing strategy to connect with senior homeowners, according to Kelly South, director of wholesale content and communications at Mutual of Omaha Mortgage. During a webinar hosted by the company, South presented direct mail as a trusted, personal, and tangible approach that can effectively generate leads and closed business.
South noted that many believe direct mail is no longer effective, but data suggests otherwise. A study by Lob indicated that 78% of individuals aged 55 and older read their mail on the same day it is received. Furthermore, PostGrid data shows direct mail yields $58 in revenue for every dollar spent, significantly higher than paid search ($19) and email ($7).
Effective campaigns should target homeowners aged 55 and older, as some proprietary reverse mortgage programs have a lower minimum age requirement than the federally insured Home Equity Conversion Mortgage (HECM) program, which requires borrowers to be at least 62. South also suggested segmenting campaigns for homeowners who own their homes outright versus those with an existing mortgage, as their understanding of reverse mortgage benefits may differ.
Postcards are highlighted as a cost-effective engagement tool, boasting an average response rate of 5.7%, surpassing that of letter-sized envelopes. Enhancements like handwritten fonts and real or faux stamps can further boost open rates. South stressed the importance of long-term campaigns, recommending eight to 12 weeks of consistent outreach, supported by phone and email follow-ups. Each campaign should feature a single, clear call to action to avoid confusing consumers.
Campaigns can be structured as invitation to apply (ITA) for broader brand awareness or as prescreening efforts, which use more specific data and offer a higher ROI but require adherence to the Fair Credit Reporting Act (FCRA) and clear disclosure of offer terms. Measuring campaign success involves tracking calls, appointments, applications, and funded loans, with a goal of responding to all consumer inquiries within 24 hours. Vendors such as Experian, Camber Marketing Group, CallScaler, and CallRail can assist with campaign tracking and management.
Compliance is crucial, with advertising needing to avoid misleading statements, false urgency, and implications of government endorsement. Key loan terms and eligibility requirements must be clearly stated, and while HECMs are insured, they are not endorsed by the government. Borrowers must still meet ongoing obligations like property taxes and insurance.