Differentiate to Survive

Differentiate to Survive

Lenders and vendors are under intense pressure to survive in today’s current mortgage environment. Products and services that were in great demand just a couple of years ago have almost completely evaporated. Lenders have had to dramatically adapt to these market conditions by changing their product mix, origination process, underwriting guidelines, valuations and funding to produce saleable and profitable loans. Servicers have had to shift focus to loss mitigation, loan modifications, short sales, REO’s and foreclosures to remain viable. In addition, the current regulatory environment is constantly, changing rules and adding significant pressure to the entire mortgage progress.

Lenders and servicers are not alone in feeling the pressure. Vendors are frantically working to respond to these challenging times by rolling out new products, realigning development efforts and creating strategic partnerships to meet the new demands while striving to remain compliant. They are faced with tough questions: Do our current products have enough flexibility to be modified or do we need to develop new solutions from scratch? Are these new products long-term solutions that have sustainable revenue models or are they just a quick fix that has a short shelf life? What types of products and services will lenders and servicers invest in during these market conditions?

These conditions have created a reactive environment that is primarily focused on survival. When this takes place, lenders, servicers and vendors are often preoccupied with the rush to respond to immediate needs. This reactionary response often overshadows the need for long term success strategies in the marketplace.

Very few of these solutions are truly one of a kind. Therefore, it is critical for lenders, servicers and vendors to differentiate themselves in the marketplace. The key to effectively doing this is in developing their “Unique Value Proposition” (UVP). While this may seem obvious, in the rush to respond to market conditions many companies overlook this critical component.

Developing a powerful and meaningful UVP requires thought and creativity. One way to begin this process is to take a careful look at your competitors and analyze their marketing material, press releases, and website. Look beyond the products and services that they are selling and analyze how they are saying it and to whom they are targeting their products. This allows you to gain a great deal of insight on how that company is trying to distinguish themselves.

Keys to developing your UVP to more effectively respond to today’s market conditions:

Work to understand your prospects needs. Try to understand things from their point of view. Look beyond your daily responsibilities, and truly analyze what your prospect needs and is willing to pay for. What business challenges or opportunities are they trying to address? What would their ideal solution look like?

Understand your prospects emotional and decision making drivers. What drives and motivates your prospect to purchase? Dig deeper than just traditional target audience analysis. Once you have defined your target audiences, analyze what truly motivates these prospects in the target audience to purchase. What factors into their decision making process? Not just how the decision will be made, but what will this solution do for them (i.e. ease a burden, eliminate bottlenecks, reduce costs, eliminate redundancies etc.)

Discover the reasons for prospects purchasing your solution. Don’t assume you know the answer. Ask questions of your new client if you what to gain the insight needed to close more deals in the future. Why did they purchase your solution instead of going with a competitor? Probe deep enough to get true insights that can be used to differentiate your products and services in the marketplace.

Upon completion of this analysis, it is time to look to what actually stands out from the information gathered. What is it that your prospects actually need? What are their emotional drivers and how can you differentiate your message to most effectively position your offerings to sell more?

At the end of the day those lenders, servicers and vendors that can proactively create a “Unique Value Proposition” that differentiates themselves in the market will not only survive but thrive no matter what the market conditions are.