One day, a box showed up at my house. Actually, that is not that abnormal because I get Amazon boxes constantly as I try to maximize the value of my Amazon Prime subscription and demonstrate my laziness and distaste of shopping. In fact, I once ordered Windex on my phone while lying on my sofa and it showed up. I didn't use the product, but the fact that I could get it was just great.
I also get my Keurig coffee delivered monthly from Amazon, which tells me that we have finally advanced as a species to the point that we can get single servings of drugs in the mail.
Well, this particular box was not from Amazon. Furthermore, I had nothing to do with ordering it. You see, I have a millennial in the house and they have their own way of engaging with the world. As you'll see from this story, it extends to a lot more than just how they order consumer products.
The box that showed up was big and was obviously packed by a human and not an Amazon drone. It was actually from a private clothier and was addressed to my teenage daughter.
When she finally opened it, I was alarmed to see 20 different T-shirts in various colors and styles. I asked her why she was wasting her hard-earned money on this (she actually has a part-time job at an insurance agency), and she calmly replied, "Daa-add (two syllables), they were free."
Huh? Something for nothing? I haven't seen that since we eliminated mortgage underwriting last decade. She explained that she had received the package full of product samples from a manufacturer who hoped that she would review them positively on her blog. What blog?
This is how I found out that she had been writing a blog for several months about teen fashion and had built up an audience of thousands of viewers. I knew nothing about this, which naturally appalled me. How could she launch such an endeavor without getting advice from a renowned sales and marketing consultant who happens to live in her own house and who buys her food, and asks her every day, "what's new," only to be consistently told "nothing?" Starting a blog is definitely not "nothing." I felt left out. After all, didn't she know that I was one of the founders of mortgage.com? And look how that turned out. Well, never mind.
She did not exclude me on purpose; it's just that to her this was no big deal, and certainly not something that required Dad's assistance, which is another way of saying she didn't need my credit card to launch it.
Here is what she did, along with my GenX response (in parentheses) to each step. She had simply built a site (imagine our generation doing that in high school), started following other fashion bloggers (how do you even find them?), posted comments on others' sites (how do you know they are not creepers?), and soon enough she had a following (who followed you and why?). You see, what she did was natural to her. It involved a whole series of small steps, none of which were part of how our generation communicates.
The blog really took off one night when she started posting pictures of outfits on the show "Pretty Little Liars," (which itself is an interesting millennial-style whodunnit featuring teenage girls being threatened by text message). Then, she found all the crazy expensive outfits at cheaper prices on the Internet, many times posting the links with Amazon.com options. (Discount shopping — I understand that part.) So, she tweeted these posts (with the popular hashtag for the show itself) and many like-minded girls were now interested in her tweets, blogs, and instagram pictures (She uses the popular photo sharing site so much that they are considering changing the name to "InstaGRAHAM"). Suddenly, she had thousands of followers. So she started posting more often.
So, what the heck does this have to do with mortgage? Well, it has a lot to do with millennials, who ultimately will provide the future growth (hopefully) for homeownership. You see, millennials think differently than we do. As I wrote about last week, they value the feedback of peers, and they want constant stimulation and online engagement to feel connected. Remember, in my daughter's case, she was using her phone to take a picture of an outfit on the television, then adding that to social media outlets with links to options for places to buy the clothes. And there were thousands of kids who were interested in just that kind of content.
I think this points out potential for mortgage marketing and about the type of employees we ultimately may need to hire to attract these millennials. But attracting, hiring and managing them may be no picnic for us older folks. To do this, we're going to have learn to think like they do, or at least understand it. That will require us to think outside of the Amazon box.
To really understand this group, we have to get beyond the idea that they shop online. It's not just that they do it, it's about how they do it. To fully capitalize on this, we're probably going to have to attract and hire more millennials. That means getting into social media like they do.
This generation has never been disconnected. They expect us to meet them there, but they have no patience for us if we do it wrong. Use social media right and you attract them like flies...or my daughter. Use it incorrectly and they won't mention your firm, much less ever work for you.
According to a recent National Business Ethics Survey conducted by the Ethics Resource Center, millennials are excellent at integrating technology in the workplace. However, fail to provide immediate feedback and recognition and you'll lose them. After all, this generation doesn't expect to remain with one employer for long. Less than half of millennials expect to remain at their current job for more than five years. Compare that to 73% of Gen Xers and 75% of the boomers.
Once we get them, we have to empower them to do what they do. A case in point is social media. As an industry, many mortgage companies have created social media policies. However, the policies tend to start with what the users can't do. You can't post information about loans. You can't post a rate without an APR. You can't post without getting approval from your boss. All of which may make sense from a risk mitigation perspective, but what you're doing is making sure that you can't let millennials interact in the way that they choose to do so.
These are the employees that are going to be best at communicating with the future homebuyers we need to attract, but it's going to take work to keep them. It starts with knowing more about the employees that you've already engaged. At Stratmor, we use a census tool that allows lenders who work with us to know a great deal about the makeup of their own teams. This informs their future recruitment efforts and allows them to create the right culture for the employees they already have.
I'll surely talk about this more in the future because I believe our future depends upon understanding and being able to work with this new generation. So, let me close with an example of a company that values the ability of the millennial to generate business for them — and that company is Amazon.com. This company does a lot more than just sell Windex and coffee over the Internet. They also find aspiring bloggers, like my daughter, and offer them chances to "curate" collections of items for sale on its website. And my daughter did that, and receives a small fee anytime a customer buys an items on Amazon based on one of her blog postings. So, Amazon has an outreach program to "small" (micro?) fashion bloggers, and is willing to work with them to drive traffic to its site.
RESPA attorneys would have a field day with mortgage companies bribing teenagers to send them traffic, but the idea of establishing a number of connected relationships and then maintaining those relationships over a long period of time has merit. That will drive traffic far better than the now archaic referral model involving begging real estate agents for an introduction to their client.
This will require lenders to create content and build a presence that will appeal to this market. They'll have to do this one blog post and one connection at a time, and it's probably going to take millennial mortgage experts to make that process effective. Maybe my daughter will follow me into the mortgage industry after she graduates from college. Of course, she may be too involved with her fashionable friends to bother.
It would be a lot easier if we could just order mortgages on Amazon, where perhaps prime borrowers who are also prime members could get a prime mortgage with free shipping. And maybe free Windex included. Why didn't we think of that at mortgage.com?
Garth Graham is a partner with Stratmor Group, and has over 25 years of mortgage experience.
