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Stop Taking Money From Strangers…

As we grow our customer base here at LoanCirrus, we find it necessary to gain deeper insights into whom we are serving. It’s tempting to use the most natural generalization of our customers: ‘we serve lenders’. Many of you who are lenders may say ‘we serve borrowers’. If you are in the restaurant business it might be tempting to say ‘our customers are persons that are hungry’. Broad generalizations like these don’t work because while they may describe a key transactional element of your business model, they cannot help you build your true value proposition. Without an understanding of your value proposition your business won’t thrive.

The best way to deepen your customer insight is to create profiles of your customers. A customer profile should not primarily be about the demographic and biographic description of the customer. It’s really about where the customer is in the cycle of their life or business – where are they on your value chain. So, instead of simply finding things that describe who your customers are, we want to be looking for attributes that explains where they are.

Here’s an example:

Some of our customers are entering the business of lending for the first time, while others are well established lenders. The fist section of our profile is: ATTRIBUTES.

First give your profile a name that reflects the uniqueness of the segment. For us, we call users entering the business of lending for the first time STARTERS.

Second, start listing attributes. Here are some of the ones we created for our STARTER segment:

  • Starters are likely not ready to start lending NOW
  • Starters may be actively shopping for loan management systems
  • Starters may not have funding to start lending right now
  • Starters need resources to help them get started
  • Likely to be currently working full time
  • They are highly entrepreneurial

Understanding the attributes of customers will help you anticipate their needs. If you don’t know where your customers are in their life journey (business or personal), then you won’t know what they need. So, the second thing we do is assess the NEEDS of STARTERS.

Here are some sample ‘needs’  from our Starter profile:

  • Starters need our best practice guide for starting in Lending.
  • Starters need our How to Start a Lending Business Guide
  • Starters need our Blog articles and should be subscribed

Get into your customer’s life journey – this is where empathy becomes an invaluable trait for anyone you allow to speak to your customers or prospective customers. Needs do not always have immediate or short-term transactional value for your business. Sometimes the value comes later. For example, we don’t make money when someone reads our blog articles but we know someone entering the business of lending could get value from them. If they decide to start lending a year from now; being a value contributor to them now will help them decide to take a look at your product or service.

Customer attributes and needs should coalesce and shape the voice and tenor of your customer communications. The third section of our customer profile is COMMUNICATION – How do you speak to the customer and what do you say, now that you know where they are on the value chain and what they need from you?

We speak to our prospective customers most often by providing them with online tutorials so they can understand how to use loancirrus. Schedule a tutorial HERE.

We believe Starters want…

  • To learn about the basics of lending. So, we go slow and show them basic features.
  • To be shown how clients are created
  • To be show how to manage clients and about how easy loancirrus makes customer communications.
  • Help processing loan applications with basic, simplified workflow process and controls. We know the advanced things can come later.
  • Help to understand that document management is an important part of a lending business and we show them how easy we make it.
  • Help with Penalties & Fees which can be important revenue enhancers for lenders, especially when they are small.
  • We gauge user interest in other features but we want a quick tutorial since we expect these customers to come back when they are ready. Remember attribute #1? They are likely not ready now.

Profiles may also suggest preferences for content delivery channels. If you know that your customer needs a White Paper describing some technical aspects of your business, such as how you arrived at your interest rates, Facebook may not be the best way to push that. If on the other hand, what they need is a calculator to determine affordability of your product or service, sending them a link to a snazzy web app may be ineffective, even when sent via Facebook. Think carefully about the way you balance distribution and align with attributes and needs.

In summary:

  1. Name your profile
  2. Focus on attributes not just demographic markers
  3. Define needs
  4. Decide how and what you will say to the customer

How you apply this to your business

If you are currently not using profiles in your lending business (or any business) you are not as good as you could be. You are not wowing your customers they way you could be and you are not as efficient with your marketing (especially acquisition marketing) dollars as you could be. In short, you are leaving value on the table. As soon as you stop taking money from customers you don’t know; you will find that deep customer knowledge yields higher returns.

To Your Success!

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