From a sales and marketing perspective, the title industry is perplexing…a veritable conundrum. Every title company, large or small, must engage in sales and marketing to win new business, grow market share and increase revenues and profits. In a down market, sales and marketing might be the only thing keeping your doors open. The job of your sales team? Go out and meet with prospective customers and persuade them to send you business. And there the problem begins…
Take almost any other industry in American business. The goal of sales and marketing is a coordinated effort to win new customers by convincing them that the company or product the salesman offers is the best, fastest, cheapest or whatever the top selling feature is. It is commonplace for meetings to be conducted over lunch, dinner, at a ballgame or in the corporate tent at The Masters golf tournament. To supplement the sales conversation, it isn’t unusual for the prospective (and current) customers to receive very nice birthday gifts, holiday presents, etc… In very competitive high-dollar purchase markets, the gifts may even be lavish.
Now, try that in the title industry. Of course, the new sheriff in town, the Consumer Protection Financial Bureau (CFPB) will be at your front doorstep in a hurry—all in the name of RESPA. RESPA, you’ll recall, forbids you from giving your customers a “thing of value.” You’re limited to giving away cheap pens and calendars. If you do business in California, Texas, Idaho, Washington and other states, the local Department of Insurance (DOI) may get there first. Try explaining the corporate outing you just hosted at The World Series or even the local little league game and see where it gets you.
Legislation and regulation in the real estate title industry have turned the sharp sword of sales into a limp noodle Premiums are set, charges are regulated and you can’t even buy your best customer a birthday present. The “thing of value” restraint RESPA hangs over your head threatens to make every agency in the industry look the same to Realtors and loan originators. Plain vanilla.
The answer? Let’s redefine “thing of value.” Instead of logo golf balls and dinners out, take RESPA out of the picture by delivering out-of-the-box solutions for your customers that cannot be defined in terms of dollars and cents. Help your customers close more transactions, get more referrals or reduce business expenses. You’ll stand out in the crowd as being an innovator and no one but customers will be at your front doorstep when you get to work in the morning.
Stay tuned. We’ll have ideas on just how to do that. And I welcome your ideas in the comments below.