FHA Streamline has been around a while.  What makes it more relevant is after June 11, 2012 discounts on upfront mortgage insurance premium (MIP) will save consumers with an FHA loan quite a bit of money.  In reading Dan Green’s blog about FHA streamline he did a great job of defining the eligibility and qualifications, which is his job.  My job is to help you target those consumers.  If your company owns or services the loan then all of this information is at hand and you are in the best place to get the streamline done and secure your customer.  For everyone else, companies with mortgage data like Altair will help you target.   Dan’s blog had the criteria, which is straight forward.

• Perfect, 12-Month Payment History Required
• 210-Day “Waiting Period” Between Refinances
• Employment And Income Are Not Verified
• Credit Scores Are Not Verified
• The Refinance Must Have “Purpose”
• Loan Balances May Not Increase To Cover Loan Costs
• Appraisals Not Required

The key right now is if the loan was endorsed prior to June 1, 2009 the upfront MIP is 0.01% or 1 basis point compared to the standard 1.75% or 175 basis points.  On a $100,000 loan the upfront MIP is $1 vs the standard $1,750.

For loans endorsed after June 1, 2009 and but not within the last 210 days the upfront MIP will be 1.75%.  While the rate is higher certain homeowners will be eligible for a credit for upfront MIP previously paid.

Nationwide Altair has over 1.6MM FHA loans prior to June 2009 and 1.8MM FHA loans post June 2009.  To see a full breakdown by state and LTV contact me tblackman@altairci.com.

I recently received 2 coupons from a local grocery store, the first to my fiancé, and the second to an indecipherable name.  Both saved me $5 off a minimum dollar spend amount.  Frankly, receiving two was great for me, but it got me wondering about how much it was costing the grocery.

Let’s look at the numbers:

I ran a count on the Altair Online System, and in Williamson County, TN alone we have 67,718 households.  As a conservative estimate, I am going to say that 2% of those are duplicate mailing addresses or incorrect name/address.  That gives us a remaining 1,354 for incorrect “junk.”

Average printing and mailing costs per piece may be anywhere from $1.00-2.00 per piece based on a large direct mailer I checked out online.  This doesn’t sound too bad on a per piece basis, but when you consider the 3,386 times $1.50, you’re looking at $2,031 in wasted marketing dollars.  And that’s in ONE county, with ONE mail piece.  It also doesn’t take into account that I now have more than one $5 coupon.  Now, consider that there are 110,483,968 households in the country.  I’ll let you do the math.

Point is, marketing dollars can be easily wasted if you don’t have the correct data and/or a streamlined system between your different channels.  As mentioned in our Loyalty study results, one of the largest struggles for companies is data integration.  This new “Big Data” nightmare can really add up on the cost side of marketing, but we can help!

Whether you have a website, coupons and direct mail, a digital & social media presence, a newsletter, or all of it!  We can segment your customer base data across all these different platforms.   For example, who is using your coupons and is also visiting the website frequently?  Who is receiving your newsletters but does not yet buy your products?  We can take the data and consumer information from all these platforms, including your POS, Accounting, Web, etc. and clean it up for you, then link it all into a single standardized database.  Voila!  Increased ROI and less waste in marketing.

Loyalty programs can be hit or miss.  Many companies are jumping on the bandwagon offering loyalty or reward programs.  If you have a loyalty program or are considering implementing one, you have to make sure it will accomplish your goals.  There are four primary reasons for starting a loyalty program:

1.  To collect names, addresses and emails of your customers.

2.  To reward your best customers and to keep them loyal to your brand.

3.  To increase the share of wallet of your customers who are not your most loyal customers.

4.  To profile your customers so that you can improve your acquisition marketing.

I will go over these goals in greater detail over the next few weeks.  To begin with, you must determine which of these goals apply to you (you can, of course, accomplish more than one) and define actual numbers or metrics that you want to achieve.  Second, you must determine how you will measure your results.

In a perfect world, you want to link your POS system with your loyalty card information.  This should allow you to capture transactional information for each member.  Why is this important?  To help you tailor your offers to your members.  For instance, I am a good customer of Costco.  As a shopper, I love Costco.  I shop there for business supplies and for many of our household items.  As a side note, for all the men out there, you can’t beat the two dozen roses for under $30.00 at Costco—they’ve bailed me out on several birthdays and Valentine’s Days.  But, I digress.

I receive weekly email offers from Costco and one I recently received had a prominent, enticing offer for Huggies diapers.  Only one problem, my youngest child is 7—way out of diaper range, thank goodness!  So, why is Costco sending me diaper offers?  Apparently, their transactional information is not tied to their marketing data.   By looking at my transactional data, Costco would be able to make more relevant offers to me—thus growing my wallet share with them.  If they offered me a discount on electronics, I just may buy my next TV from Costco instead of using my Best Buy RewardsNow card.

Share of wallet can be measured by collecting purchase data from surveys, credit card transactions, and other market research sources.  The importance of share of wallet is to find out what your customer is NOT buying from your store.  For instance, Kroger does a terrific job of mining their customer transactional data and giving me offers related to my recent purchases.  However, they don’t know that I have 3 kids and I buy $500 of groceries each month at Walmart.  By properly profiling their customers and analyzing share of wallet, Kroger would be able to achieve a greater share of wallet and improve the offers to their customers.

Finally, don’t worry too much about having data in multiple systems.  Any good Customer Intelligence agency will be able to integrate your data from multiple databases into a measurement and reporting system.  However, you must have a unique customer id at the point of sale (POS) in order to tie purchase data back to a name and address.  Most POS providers have this capability now.

Being from Georgia, I’ve spent my fair share of time deer hunting and hanging around hunting camps, hunting lodges and the like.  So, I’ve eaten venison (deer meat) on many occasions.  For me, I don’t care how you cook, braise, saute, pound, or marinate venison, it is still tough.  But, as someone eats a particularly good venison meal, they’ll invariable exclaim, “Wow, this is almost as good as a hamburger.”

Of course, there are the well-known sayings when someone cooks rabbit, quail, alligator, or even rattlesnake—”Tastes almost as good as chicken.”  This is how many users—especially the mobile innovators—sound when they describe their mobile app.  “Wow, this healthcare app is almost as good as WebMD!”  or “This Mint.com app is almost as good as the desktop version!”

To me, there are definite benefits to mobile applications such as:

• Convenience—if I want to track foods that I eat or expenses for travel, I can enter them as they happen.
• Just in time–making a deposit from the road to cover a potential bounced check
• Recreation—reading my Droid Kindle at the beach or listening to my Daily Bible app in the car

So, how does this relate to marketing or customer intelligence?  First, know your audience.  We know from our statistics that more people feel the same way I feel than not.  A lot more.  So, if you are making a decision on where to reach your best customers, you need to know are they Mobile Fanatics or Desktop Lovers?

Second, know your offer.  If your offer is convenience, just in time, or recreation, consider mobile marketing.  If not, use other avenues.  I saw an ad for Dollywood on my DroidX yesterday while I was trying to beat my best score in TossIt.  Later that day, I was perusing TripAdvisor, Expedia and Kayak looking for a place for our corporate incentive trip next year.  Where would a Dollywood ad have been more valuable?

Don’t get caught up in the hype around social media and mobile applications.  Yes, the majority of articles in DMNews, AdAge and the like are focused on social marketing and mobile because these are new, innovative approaches.  But, they are still a small segment of any well-planned marketing initiative—if they are fits at all.  The only way to know if or how you should include a social media or mobile application strategy is to analyze your current marketing, your current customers and prospects and see where they want you to reach out to them.

If they want chicken, give them chicken!

Advertisers continue to covet the 18 – 54 demographic in both the online and offline world.  On what data are these targets based?  Of course, the old school thought-process was get to the younger crowd and develop brand loyalty early on.  And that certainly worked 30 years ago.  Was your dad a Ford, GM or Chrysler guy?  Did your family use Crest or Colgate?  Scope or Listerine?  Miller or Bud?

I vividly recall my marketing professor’s teaching the importance of the younger generation back in my marketing classes back in the 80′s.  Hasn’t the access to mountains of data and sophisticated customer intelligence analysis identified new strategies and segments over the past 25 years??  Brand loyalties are seemingly shifting with the next Groupon or coupon coming down the pike.  And brand’s are so fragmented and cannibalized, how much brand loyalty is left?  Dare I say, our toothpaste drawer consists of at least 3 different brands of toothpaste.  Does it still make sense to market to the fickle 18- 34 age group?

Not if you believe an article in the 11/15/2010 edition of USAToday (www.usatoday.com).  In an article titled “Big-spending Boomers Bend Rules of Marketing” (see link here: http://www.usatoday.com/money/advertising/2010-11-15-babyboomers-spending_N.htm?loc=interstitialskip), baby boomers are correctly identified as a “new” market with much greater spending power than the under 50 crowd.  I’m not sure if the 50+ crowd is more compelling because they have more quantity (77 million members and growing), they have more loyalty, or they have more money.  The combination of all three is attractive.

As you are planning your upcoming marketing strategies, don’t underestimate the 50+ crowd.  In fact, make them a key part of your strategy and you may be looking at your competition in the rearview mirror.

The number of mortgage refinances has risen steadily for the past 6 months averaging over 400,000 monthly refinances in August, September and October. With interest rates at historic lows and home values at depressed levels, many homeowners are deciding to stay in their current homes longer and to lock in a low, long-term rate.

From a low in November 2008 of 100,000 refinances, there has been a sustained level during the past 2 years of at least 300,000 refinances per month. Four times refinances have exceeded 500,000 loans in April, June and July 2009 and again in April 2010.

As reflected in the chart below, the bulk of the activity is in loans under $500,000 with most loans falling in the $101,000 – $200,000 range. This has trended downward significantly, probably as a result of falling home values.

For banks and mortgage companies offering prime loans, there is still a significant opportunity to market prime refinance loans in today’s market. If you need help reaching the homeowners who are likely in the market to refinance in the next 30 to 90 days, you may want to test the Altair Customer Intelligence Prime Refinance model.  The model gives you access to over 18 million prospects who are 2.13 times more likely to refinance than without the model.

 Groupon has quickly become one of the greatest Internet success stories.  In less than 2 years, Groupon is generating $500+ million in revenue at lucrative profit levels.  Their success hinges on their ability to deliver great deals or coupons and drive large amounts of traffic in a very short period of time.  So, what can direct marketers learn from the Groupon model?  First, let’s look at Groupon’s description from their website:

Explore Your City at 50%-90% Off

So, how does Groupon succeed in achieving high response rates?  While their success can be partially attributed to several factors, there can be no denying that Groupon’s hook is the offer.  In fact, to be featured a merchant must provide an offer that is substantially better than their typical offer.  Most Groupon offers are 50% or more off of the retail price.  In comparison, the average offer on a direct mail campaign is 17% off of the retail price.

In the Groupon example, merchants are offering a 50% off and they pay Groupon 30 – 50% of the amounts they collect.  In essence, their cost per customer could be $30 to $50 or more.  I know what many of you are thinking—I’d kill to acquire a customer for as little as $30 to $50 each.  Have you tried a 50% offer??

The lesson to be learned is determine what your overall goal’s are (traffic, profit, new customers) and test several different offers.  Also, consider increasing the size of your offer and see if you can improve your results.

Altair will be posting a series of blogs which will focus on the benefits of using a Primary Market Area (PMA) geographic selection to more effectively utilize limited marketing dollars.  Over the next few weeks we will address the building, implementation, measurement, and refinement of PMAs to help direct marketers improve marketing selection and increase Return on Investment (ROI).

Here is a brief overview to get you started:

• Defining your Primary Market Area (PMA) using Altair’s proprietary process brings the benefit of better geographic selection at the individual branch level.  The ROI at the location level will increase due to the ability to narrow or broaden the prospect pool based on the location’s ability to serve a particular customer.
• PMAs naturally account for surface road access, natural barriers and proximity to your other locations.   PMAs also outperform other methods of geographic selection.  By using your recently acquired customers as a base, we are able to select prospects individually using the most refined geo coding versus more blunt options such as radius or zip code.
• PMAs provide a relative measure of proximity across the branch network instead of utilizing a constant radius.
• Utilizing PMAs in conjunction with other targeting tools, such as a response model and selection criteria, allow you to further refine the selection of your best prospects.

Next, we dive into what you will need to build and how to build your PMA.

Loyalty programs have finally begun to get the attention they deserve.  From veterans such as Best Buy and Kroger to relative newcomers such as PetSmart and Bass Pro Shops, it seems that retailers are racing to jump on the loyalty program bandwagon.  And for good reason.

With the advent of digital media, it is much easier and more cost effective to contact customers at specific times with specific offers.  But, here are some mistakes from a few of my favorite loyalty programs:

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So, you are pricing out your direct mail program and you realize you can save 30% on postage by mailing at saturation rates instead of standard postal rates.  Sounds like a no brainer—or is it?

To make a good decision on whether to use saturation in a direct mail campaign or targeting, you must first decide your marketing goals.  Are you trying to maximize the number of responses you get, or would you rather have higher quality responders?  What are your key metrics such as Cost per Lead, Cost per Response, Response Rate, Conversion Rate or Return on Total Marketing Investment?

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