On this episode Josh speaks with Brian Stroka, President of SEK Business Solutions. They talk about niche automation marketing and using automation to target leads and generate sales.
Brian enjoys helping honest and hard-working businesses expand their market share through the same simple and effective strategies that have led to the successes that he has had in both online & offline business ventures.
With over a decade of experience in the Real-Estate Sales & Financing industries, it’s his experience and superior results that sets him apart.
In today’s episode you’ll learn:
possible title: The Future of Marketing Automation: Smarter Strategies and Niche Solutions
Narrator: Welcome to The Sustainable Business Radio Show podcast where you’ll learn not only how to create a sustainable business but you’ll also learn the secrets of creating extraordinary value within your business and your life. In The Sustainable Business, we focus on what it’s going to take for you to take your successful business and make it economically and personally successful. Your host, Josh Patrick, is going to help us through finding great thought leaders as well as providing insights he’s learned through his 40 years of owning, running, planning and thinking about what it takes to make a successful business sustainable.
Josh: Hey, how are you today? This is Josh Patrick. You’re at The Sustainable Business podcast.
My guest today is Brian Stroka. Brian is a niche automation marketing expert. His specialty is in the mortgage business. That’s what we’re going to talk about – what is niche automation marketing. Since I really don’t know what it is, but I do love niches and I love automation marketing, so I’ll probably like it. Let’s bring Brian on and get started.
Hey, Brian. How are you today?
Brian: Good, Josh. How are you? Good morning.
Josh: I am well. Thank you.
Tell me, since I’ve never really heard the term, I can probably figure it out if I had to, what is niche automation marketing?
Brian: Well, I want to start by saying that sales will always be about relationships and people will always buy from those that they know, like and trust. What the automation does, it allows you to build that relationship. It helps you build that relationship. The niche part of it is each automation needs to be customized for a specific niche. I know there’s a lot of automation out there and they paint it with a broad stroke, but each niche needs to have its own automation system.
Josh: Can you be a little more detailed on that and tell me what that would mean? Let’s talk about the mortgage business because that’s where you spend most of your time. What would a niche automation system look like for the mortgage business?
Brian: All right. Let me take one step back here. The buzz phrase for 2018, in the mortgage business and probably a lot of other industries, is lead generation. Probably, all of mortgage broker owners hear that phrase now and it’s a good way to end conversation. While lead generation is a necessity, lead generation by itself is basically worthless. What a lot of these brokers were doing were buying leads, giving them to their loan officers and then kind of saying “Go get them.” What the loan offices were doing were simply just calling these leads over, and over, and over. Realistically, that’s an outdated way to try to convert leads into sales. What our automation does, it shoots out very strategically and systematically, not only video emails but voice drops, and text over the course of days, weeks, months and even years, until you can get that lead to respond. It acts as a bridge in between a lead and a closed sale.
Josh: When you say a voice drop, what is that?
Brian: A voice drop is a voice mail where the phone doesn’t ring, so you’ll look at your phone and see that there’s a voice mail but never heard your phone ring.
Josh: Oh, okay. What I’m assuming is you’re using standard technology but you’re doing custom content. Am I correct in that?
Josh: Who writes that custom content? Because that seems to be a real sticking point with about everybody I know in the business, unless they happen to like to write.
Brian: We’ve run this system for a good 18 months now and it’s evolved from split testing over and over again. The normal response rate from calling a lead is around 5% to 10%. Our response rate has gotten up to 50%. We’ve tried many, many things. We have scripts for the video, scripts for the text as well as the voice drops. We have come up with those scripts and the content for our system.
Josh: Just out of curiosity, because I’ve been experimenting a lot with video email recently, I’m not having great luck, so maybe you can help me out here. First of all, what are you using for a video email platform?
Brian: We actually just have a link that goes to YouTube right now. We’re really looking to improve upon that but we are getting a pretty good response.
Josh: In the email you send out, I assume you say, “Click on this link to watch my video”?
Brian: Well, we actually just import a picture of the video. It probably makes them think that if they click the image, the video will start playing. In reality, it just opens up a YouTube page.
Josh: Oh, I see. Well, that’s true with almost all of video emailing, by the way.
Josh: So, you just copy a screenshot from the video?
Josh: Are they individually done for the recipient?
Brian: They are individualized for each individual loan officer.
Josh: Okay. So, you’re a loan officer and you were sending me an email, would it be personalized for me or would it be a standard email to everybody?
Brian: It would be a standard email.
Josh: So it’s not like, “Hi, Josh. I hope you want to give me a call, blah, blah, blah, blah, blah.”
Josh: Okay. It’s none of that?
With the amount of leads that they get and that these videos or these emails that are going out, they would be producing videos nonstop–
Josh: Right. That makes sense.
Brian: –so it’s one email with a standard script.
Josh: When you send an email to somebody, how do you get them to open the video?
Brian: What is our key to that? To be honest with you, we get so much better of a response rate texting than we do the email. It’s just part of it. Have you ever heard of the Theory of Seven? The old marketing adage where it takes seven points of contact for somebody to respond to your message?
Josh: Yeah, that’s before though I actually have a sales conversation with you, but yes.
Brian: Okay. That’s what we’re trying to do here. it’s just hit them from every side. And the email, we don’t have a great response rate on the email. But the combination of the voice drops, and the email, and the text – even if they just see our name in the email, they recognize it. Text is by far and away where we get our best response.
Josh: Do your mortgage brokers send individual text themselves or is it an automated process?
Brian: We are sending the text with our script but, when they do reply, it does go to the loan officer.
Josh: So you actually do the marketing for the loan officer then?
Josh: And you send out the emails, and send out the texts, and the voice drops?
Brian: Right. They produce the video using our script and using their smartphone. They also produce the voice drop with their voice as well.
Josh: This is a really big point here and I talk about this a lot, which is having a fully-funded marketing opportunity. Whereas, an awful lot of people, who are trying to create business through the Internet, instead of hiring a firm like yours, will try to do everything themselves.
Brian: Right. There are many pieces of software out there that allow you to do just this. A lot of people tried to do it on their own but, like I said before, we’ve just tested this over, and over, and there’s a lot of intricacies to make something like this work. A lot of the phrasing we use, in our scripts, and the consistency, and the amount of messages that go out from day to day and week to week are why our system works. There’s a lot of software out there and many do try to do it themselves.
Josh: Well, out of curiosity, what would it cost for a mortgage broker to hire you guys? What’s the cost per loan officer? Let me ask you that. I’m going backwards here. What is an appropriate cost per lead for a professional services company?
Brian: There are just so many variables to really give you an answer for that. For our lead generation which we almost exclusively use Facebook and we provide exclusive leads and our long form leads that are not just name, email and phone, they’d also have income information as well as– we try to gather as much credit information on our leads, too. We are real targeted in the type of lead that we provide to our clients. With that being said, the intricacies of Facebook lead generation are unbelievably powerful. The learning curve is immense but, when you get it right, the cost effectiveness of running a lead generation campaign with Facebook is like no other.
That’s not really where we make our money at all is charging per lead. We charge a $1500-a-month retainer to our clients. And then, for LO, we charge them $149 to run their individual system. $149 a month per LO along with the $1500-retainer for the branch.
Josh: A typical branch would have how many loan officers in it? I know it varies all over the place.
Brian: Right, anywhere from 5 to 10.
Josh: 5 to 10? Let’s say I have an office with five loan officers. How many leads would they typically get? And what would a lead be worth to them? I write a mortgage for a $500,000-house, what’s the commission that goes to the mortgage company?
Brian: The actual loan officer will make anywhere from 1% to 1.5%. They will make $5000 to $7500 per closed deal. If we’re marketing specifically for, say, a veterans loan, we can get leads down to $5 to $7, depending upon geographic location and then– so, again, that’s why it’s answer that question because there’s a lot of variables such as geographic location but, when you consider that they can make that kind of money, $5000 to $7500, they only need to close a few loans a month to be doing pretty well.
Josh: Oh, for the branch, if they were to have five loan officers, that would be $2500 a month. So, if they close one extra loan because of what you’re doing, they would be ahead of the game.
Brian: Oh, by far. The whole name of the game is bringing in a consistent inflow of continual business every single month. That’s been a huge problem. LOs right now– 90% of LOs do not make it to their 24-month anniversary. The average age of an LO right now is nearing 50 years old.
The industry’s being stubborn in changing. The death of a lot of businesses out there – I just saw a video on this yesterday, has been the statement, “This is how we’ve always done it.” Being stubborn in trying to close their leads by just using a telephone which, with today’s consumer, you have to use other methods to close business other than just making telephone calls.
Josh: What I’m going to say simply is, my rule of thumb is marketing should be about 5% to 10% of your gross sales, depending on your industry. If in fact your cost is, say, $2500 for an office, you only need to get $25,000 worth of sales which basically is one close per loan officer per month–
Josh: –which seems to me to be pretty doable.
Brian: It is. It makes total sense.
The one problem is proving a new concept is what we’re doing and getting management to see the new wave, to jump on board with what’s going on. We’ve had great success but we are having trouble getting them to believe and making the investment. That’s not the case with all of them. We have several dozen.
Josh: Let me ask you a question. Do you guys have a guarantee of some sort for your customers?
Brian: We don’t. We don’t make them sign any sort of contract. As you can imagine, with this industry, you’re not going to close a deal the very first month as the loan process takes 60 to 90 days from the time you get a lead to the time you close a loan.
Josh: You can’t guarantee closed loans but you can guarantee leads or conversations?
Brian: Most definitely. You’re right.
When we first started this, we just did the lead generation. And you’ll get that leads that are horrible when outdated selling tools used in– I don’t know if you’ve heard these stats but 70% of people do not answer the phone if they don’t know the phone number coming in. When I was speaking of the concept of seven, it’s really to get your message out there seven times when you’re just using the phone and people aren’t even answering the phone. It’s hard to get them on the phone one time, let alone seven.
Josh: Right. I agree 100% with that.
If I was in your shoes – and I’ll give you some free advice because I can’t resist. This is what I do, is I would add a guarantee to conversations that you’re going to be having with potential mortgage people. Let’s say the close ratio they have is 3% or 4% or 20%, 25%. If you could guarantee five conversations a month, that would be an easy yes for somebody.
Brian: Most definitely. That’s definitely on the lower end of the spectrum of what we’re seeing.
Josh: Your risk, for providing a guarantee, is relatively low.
Josh: I like to preach to people a lot. There’s a principle in behavioral economics called loss aversion which means we fear loss much more than we value gain.
Brian: Correct. Right.
Josh: Every time I talk about guarantees to people, they say, “Yeah, but I’m going to be taking advantage of.” Well, yeah, that’s true. You’re going to be taken advantage of but you’re only going to be taken advantage of somewhere between 2% and 5% of the time, 95% of the time you’re not. And if you do a guarantee and you can focus on the 95%, you have a huge win for yourself. It’s one of these things where–
I’m actually doing a video on this right now because I’ve hired a bunch of Facebook consultants over the last two years and they’ve all fallen flat on their face. I’ve asked the last couple for a guarantee. They said, “Well, we can’t guarantee anything.” I’m about to be done with any marketing person that doesn’t have a guarantee – period. End of conversation.
Brian: It makes total sense. Yeah. I mean, we are at the mercy of their selling ability. And even when they–
Josh: That’s why you don’t guarantee sales. You guarantee conversations.
Brian: That’s true. It’s a good point.
Josh: By the way, that gives you an upsell.
Brian: Right. I totally agree. That sounds good.
Josh: Now, it gets you an upsell up into teaching their mortgage officers how to sell.
Brian: We have recently put together a large video sales training class for the LOs because that is the sticking point. It’s teaching them how to handle these leads. It’s a new way of selling too, so we don’t expect them to know a lot of this. That is the key for this system to work, is them to convert the sales, obviously.
Josh: Brian, we have just a couple of minutes left in today’s podcast. You have a term which I’m really curious what the heck it means. We’ll talk about this for a bit and we’ll probably have to end. What is marketing for high-hanging fruit?
Brian: Okay. What we target are those clients who are not ready to buy here the next week or two, where everybody else is targeting them as well, at that point. We look for clients who are even several months sometimes out, from actually making the buying decision. That allows our automation to form the relationship over those couple of months so that we are top of mind when it does come time to make that buying decision. We coined that term high-hanging fruit. Going after the people that maybe a few months away but nobody else is going after them. They are all going after people that are ready to buy right now.
Josh: Yeah. That makes perfectly good sense because I know that if you’re going for low-hanging fruit, these people are already in the buying decision which means they likely have not looked at your website yet.
Brian: Correct. And you’re competing against a lot of people at that time where we try to [inaudible 00:15:42] and develop the relationship before everybody else does.
Josh: All right. And if you’re doing high-hanging fruit and you’re building the term “know, like and trust” – it’s really like the marketing buzz word today is those three words.
Josh: If you have a chance to actually build trust and people get to like you a bit, you’re not going to have competition and the reason is–
Brian: The reason that we’re not going to have competition is nobody’s going after those high‑hanging fruit.
Josh: And when it gets time to buy, they’re not going to bother going into a competitive situation.
Brian: Right, because we’ve already built that relationship.
Josh: And again, we have to talk about in generalities. I mean, if your client base is a bunch of engineers, they’re going to go look at everything anyhow.
Josh: The majority of the people, if you have a trusting relationship, they don’t even look, they just say, “You’re my person. I want to do business with you.”
Brian: If you don’t have the relationship, you’re just not going to get the business. We just try to get a head start before everybody else.
Josh: Yeah. Well, it’s certainly the time to do high-hanging fruit which is an interesting term. People say, “I don’t want high-hanging fruit. I want low-hanging fruit.”
Josh: High-hanging fruit is actually easier to make the sale with than low-hanging fruit.
Brian: I see what you’re saying there.
Josh: Yeah. Well, you know.
Brian: That people want the client who is ready right now, you know.
Brian: It’s harder to pay attention to a client over the course of three to six months than it is a few weeks – when they’re ready a few weeks.
Josh: My business, before I got into what I’m doing now, was a food service and vending business. I called the same customers for 15 and 20 years–
Josh: –before they will even have a conversation with me.
Brian: That’s how you do it.
Josh: If you really want to build a business, it’s about longevity and showing up, being ready to play, doing that on a regular basis.
Unfortunately, we are out of time. You have a service that’s certainly priced right and is interesting. I’m going to be bet there are people who are going to be interested in finding you. How would they do so?
Brian: Simply just type in mortgage ambush on Facebook and that’ll lead you to our page and our group that we’re running. You could just message either one of those and get in contact with me.
Josh: Sounds great. I appreciate it, Brian.
I also have an offer for you. I have a program called Cracking the Cash Flow Code. What that’s about, it helps you figure out how you can create enough cash in your business to fund your lifestyle, have a fully-funded marketing program like we talked today, have enough money for an emergency fund when your business goes south – and it always happens, and to have enough money to fully fund a retirement plan because you may think your business is going to get you to retirement by itself. I will promise you, it won’t. Below this, you’re going to see a call to action button. Click on it and you’ll get our infographic which talks about the five stages of Cracking the Cash Flow Code.
This is Josh Patrick. We’re with Brian Stroka. Thanks a lot for stopping by today. I hope to see you back here really soon.
Narrator: You’ve been listening to The Sustainable Business podcast where we ask the question, “What would it take for your business to still be around a hundred years from now?” If you like what you’ve heard and want more information, please contact Josh Patrick at 802-846-1264 ext 2, or visit us on our website at www.askjoshpatrick.com, or you can send Josh an email at email@example.com.
Thanks for listening. We hope to see you at The Sustainable Business in the near future.