Marketing Mortgages to Millennials: What they look for and 5 ways to stand out

The Millennial generation represents a huge opportunity for the mortgage industry. Why? Well, with the leading edge of this giant demographic in its middle-thirties, they are coming of age. Now in the midst of making career headway and creating families, they are beginning to make decisions about when and where to settle down, what to do with their money, and where to live.

According to the National Association of Realtors’ 2018 Home Buyer and Seller Generational Trends study over the last 12 months more than 1/3 of all home purchases in the U.S. were made by people between the ages of 19 and 27.  This makes Millennials the most active segment of buyers for the 5th year in a row. They also represent 2/3rds of  first-time home buyers.

They are, in effect, the largest pool of potential homeowners out there. But, to reach them effectively and convince them to do business with you when they’re ready to take on a mortgage is tricky.  If you are looking to reach Millennials with your mortgage loan products, ask us how we can help.

Mortgages, for all intents and purposes, are a commodity. To stand apart from the competition and have Millennials take notice of your company cannot be accomplished in the same manner as with previous generations. No, Millennials operate differently. They grew up surrounded by technology, which shaped how they interact, shop, work, and recreate. This fact alone has big implications for how to market your mortgage company to them successfully.

What do Millennials look like?

Born between the early 1980’s and mid-2000’s, Millennials range in age from mid-teens to mid-thirties. They total over 80 million individuals, representing the largest generation in the U.S. In fact, in five years they will make up 50% of the country’s working population, and by 2025 they will claim 3/4 of all jobs.
At the same time, Millennials are considered the best educated generation. Almost 35% of 25 to 29-year-olds hold a degree – but at a price. They are carrying some of the highest debt levels in history, including student loans and significant credit card balances. And, many Millennials graduated and moved into the job market during the Great Recession. The lingering effect of challenging employment prospects are still with them today.

What makes them tick?

While the composition of this generation is unique, how they function in the world is even more unusual. These “digital natives” were raised in an era when the newest device or latest social media site was being introduced every other month. These quick learners have embraced a multitude of communication methods. To them, the Internet, social networks, smart phones and apps are necessities.
Millennials’ beliefs are established and confirmed by others. They actively seek out peer opinions and reviews when formulating opinions and making decisions.  They tirelessly conduct online research, resulting in a lot of shopping and little buying. Skeptical by nature, they inherently distrust advertising hype and buzz, rendering traditional forms of marketing ineffective. Instead, Millennials build trust in institutions and organizations by gathering bits of information from many sources. And, they do this very quickly. They also carefully weigh how businesses conduct themselves ethically. For them, how organizations operate in a more global context is often important.

What do Millennials look for when choosing a mortgage company?

Here are five of the top traits this demographic considers when selecting a mortgage company, beyond competitive rates:

  1. Ethics – First, Millennials have a conscience. The significant events of their early years – the Oklahoma City bombing, Columbine, the 9/11 attacks, long and costly wars and financial turmoil – have ingrained in them a passion to work with firms that are focused on the greater good. They seek out mortgage companies that give back in big and small ways.
  2. A strong online and social media presence – There is no escaping it. Being present online is no longer enough. Millennials will use not one, but many, online sites and social media outlets to form opinions about which mortgage company is worthy of winning their business. They not only expect a broad digital presence, but because it factors into their decision-making process, that presence must be engaging as well.
  3. Positive peer reviews – What their inner circle thinks matters. Millennials have mastered the art of information-gathering and opinion-forming from among friends and acquaintances. Positive affirmations and social endorsements about mortgage companies heavily influence their buying decisions. In their world, power and information come from connections, not from subject matter experts.
  4. Believability of brand – Millennials have the uncanny ability to smell a rat in an instant. In order for them to believe in your mortgage company, they must believe in your brand and everything it stands for. And, they must experience it personally. They want absolute honesty, 100% of the time. If they do not believe in your brand and what you’re communicating in a way that meets their expectations, they won’t be sold.
  5. Ability to engage – This demographic seeks out mortgage companies that will engage with them. However, their willingness to do this is dependent on familiarity and trust. Only when they are comfortable with your mortgage company and trust it will they be open to engaging in a business relationship.

5 ways mortgage companies should market to Millennials

Now that we know who Millennials are, what makes them tick and what they look for in a mortgage company, we can focus on how to effectively market to them. Here are five “must-dos” for any company hoping to win business from Millennials:

  1. Create a story for your brand – If a Millennial has narrowed the field to several mortgage companies, the one they ultimately select will be the one that strikes a chord of authenticity. To accomplish this, you should create a meaningful story for your brand, one that’s based on your “why” and answers the question as to why they should choose you. The answer(s) to that question are found in your Unique Selling Point(s) (USPs). Your USPs should be both honest and thoughtful. If they are, then you will be able to connect with Millennials on a level beyond the mechanics of what you do, as mechanics are similar from company to company.
  2. Have a steady, broad and strong digital presence – To do this, you must expand your menu of communications options across social media platforms, the web and smart technologies, (like an app, for example) in order to facilitate communication among all parties. Don’t ever make Millennials pick up a phone or you’re sunk! Instead, go to great lengths to make sure your digital presence is smooth, intuitive and answers their questions.
  3. Foster a personal dialog – You cannot successfully market to Millennials by targeting the age demographic alone. It’s not that simple. You must create a more personalized connection and a genuine conversation by incorporating other data into your targeted efforts, such as income, geography, purchase history, level of education, interests, etc. By using Big Data to customize content, you will be able to speak to them on a more individual level.
  4. Educate them – Some Millennials may be unaware of the advantages of home ownership, how mortgage lending works and what their options are. That places you, the mortgage professional, in the position of educator. But, this demographic doesn’t like to be told what to do.  They like to be in the driver’s seat. So to be effective with Millennials, you should take a consultative approach based on their communication preferences. Feed their natural curiosity and sense of discovery – and make them feel smarter.
  5. Be familiar, consistent and honest– Whether it’s your website, eblasts, social media posts or programmatic display advertisements, your creative approach should always foster familiarity with Millennials. They want to work with mortgage companies that “get” them. Demonstrate this by using (and not over-using) their language, being present on all of the digital platforms they use, and grounding your business in authenticity by telling your story honestly and succinctly.

Millennials present some real challenges for mortgage companies that hope to win their business. But, the good news is the opportunity for homeownership that exists within this demographic is tremendous. By internalizing how they think and operate and embracing what’s important to them, you can create a brand that truly resonates and, in turn, win them over.