спални комплектиThreshold Resistance, by A. Alfred Taubman is a remarkable little business gem. It is a very brief autobiography of this iconic luxury retailing pioneer, but packed with real wisdom.
The core concept is “threshold resistance,” which essentially is the philosophy of finding and eliminating anything that is preventing your customers from crossing your threshold and doing business with you.
His business was retail, but I see all kinds of applicability to online marketing and lead generation. I also spotted lots of valuable advice for sales people and understanding their mission in lowering that resistance.
IAC/InterActiveCorp (IACI) reports early this morning that it will spin out LendingTree as a part of a reorganization that will split IAC into five public firms (WSJ subscription). Barry Diller makes a couple of interesting statements in this announcement. Like a concern over complexity and lack of clarity in their conglomerate of businesses:
In a statement Monday, Mr. Diller said that "while we’ve created a lot of value, I’ve always believed our complexity and many mouthfuls of sentences to explain who we are and what our strategy is have hampered clarity and understanding with all our constituencies, particularly investors."
and a confession that their transactional businesses where seed capital for strategic business acquisitions and may be less valuable to him long-term:
He added, "One of the reasons we’ve stayed with some of our more transactional businesses is that we needed their earnings to allow us to invest in emerging Internet businesses. Now that we have real scale in the pure Internet units, it makes nothing but sense to me to reorganize the whole."
So, what does this mean for LendingTree and its consumers and clients?
As with most of these types of announcements, they do not occur spontaneously. Most of the changes relevant to this restructuring has already occurred:
Mindy Grossman, Sean Moriarty, C.D. Davies and Craig Nash will continue as CEOs of HSN, Ticketmaster, LendingTree and Interval International, respectively. Bret Violette will continue as president of RealEstate.com, which will be part of LendingTree.
Mr. Diller said, "Each of these spun-off businesses is in fact a distinct business sector, and each will benefit from standing on its own, with its own capital structure, its own currency which will enhance its ability to attract and retain superior talent and make acquisitions, and a focused story investors can clearly understand and buy into."
LendingTree should have the opportunity to focus more closely on their business model with more flexibility to manage the volatility of a transactional revenue model. Whereas, other transactional businesses encased within larger conglomerates like Experian/LowerMyBills may have to take less client friendly and more Experian shareholder appealing tack line.
LendingTree will undoubtedly be able to pursue more innovative, LendingTree specific, strategies and tactics in lead generation.
LendingTree, unlike other mortgage lead providers, will have support from non-mortgage specific business units (HSN, TicketMaster, and Interval International) to smooth the chop in the mortgage market, yet continue to effectively address the market.
All in all, I think this is a positive move and will benefit LendingTree and their network.
ZipSearch! has been surging above the radar in the mortgage and insurance lead generation space. The neat part to watch is that their surge is not based on colossal partnerships or press release buzz. It is built on good old fashion performance.
Their founder and CEO talks a lot about the efficacy of advertising. Answering the buyers’ biggest fear. Can I really get the effect that I am being offered in the pitch?
What our industry needs is to come out with firm best practices that address HOW leads are collected and WHAT advertisers do with leads once they get them. Issues such as transparency, data sharing, and misleading promotions need to be tackled head-on. When we talk about consumer data, isn’t the bigger issue the reselling of this personal data over and over again without the consumer’s knowledge or consent? Best practices that deal with these types of issues are what the industry lacks.
Unfortunately, we often dive to the minutiae
when everyone is dancing around self-interest and perceived loss of flexibility in our practices.
I could probably script 10 Best Practices for Online Lead Generation in a day, without much effort.
There has been a lot of discussion about Internet lead quality declining. Is it the marketing or the market? I believe it has a lot to do with consumers reacting to the media and the market.
…service that it says allows online and campus-based educational institutions to purchase leads submitted by students that have the highest likelihood of matching each school’s target student profile.
LeadPoint says the offering gives schools the ability to bid on real time higher education leads based on both the subject and the profile of the prospective student. Schools are able to target based on the prospect’s profile and their educational interests, employing filters such as school type, campus location, and highest level of education completed.
I am drawn to the concept of matching or targeting a student’s profile. This is certainly unique in the education market where most leads are generated by prospective students selecting a college and then providing an inquiry.
I have long believed that this was destined to be a bit backward and certainly not focused on the student getting the most appropriate results from their inquiry.
Although this is certainly an interesting announcement from LeadPoint it is not unique or original. And, in my opinion, probably not the best executed in class. Whereas LeadPoint simply focuses on matching the student to “each school’s target student profile,” a more interesting approach is to match a school based on a full picture of the prospective student’s profile, interests, career, and professional propensity.
Interestingly, Experian quickly and specifically lays the slowing growth at the feet of LowerMyBills:
The group said that in the six months to the end of September, its revenues from continuing businesses, at constant exchange rates, rose 6 per cent. However, the figure would have been 2 percentage points higher, Experian said, but for the fall in revenues at LowerMyBills, its US subsidiary which provides leads to subprime mortgage lenders.
In July, Experian said that LowerMyBills’ revenues fell 20 per cent in the first quarter, after an 8 per cent decline in the previous quarter, but it expected that to be the low point for the business.
This subsequent statement may explain reports that Experian has swooped in to the once hot start-up and is reengineering:
Don Robert, Experian’s chief executive, said that "while the revenue environment is tougher, we remain focused on delivering profit in line with our expectations for the year as a whole."
However, I think the most interesting part of the latest media blitz is who they leave out. They start building their master plan, as revealed on Investment Dealers’ Digest, by cutting out the mortgage broker (last I checked that was about 65% of the mortgage originations in the US mortgage market):
These days, Ranieri and Myerberg are back in the mortgage finance world with a new venture, an Internet business that links consumers directly with mortgage lenders, thrifts and commercial banks, bypassing mortgage brokers [emphasis added]. Called Root Markets Inc., the new business will be linked to Internet portals and newspaper sites.
Root Markets aims to simplify the process of finding a mortgage loan by directly linking consumers with the actual mortgage banks that will keep the loans on their portfolios or resell them into mortgage bonds. By linking the end buyers of a mortgage loan directly with borrowers, Root Markets hopes to bring down costs for home buyers.
And then Mr. Ranieri, recounts an anecdote, laying borrower woes directly at the feet of these same mortgage brokers.
Ranieri recalls fielding a call from a family recently. A nurse with five children and her husband had fallen behind on payments for a home financed with a negatively amortizing loan. Spotting the loan terms — specifically, the rising loan payments — Ranieri remembers wondering, "how the hell are you going to pay for this?"
"These are not bad people. They wanted a house with more bedrooms. They’re not stupid, but they’re financially not sophisticated. The broker sold them on the loan," says Ranieri, adding that he would not be surprised if some consumers eventually give up making mortgage payments because with home prices dropping even as their loan payments rise, they’ll have little incentive to keep on top of the payments.
Myerberg appears to be in his [Seth Goldstein] office now and the company’s website doesn’t talk about consumers at all, just buyers of leads and the companies that sell them. Except for some little house icons on the screen, it doesn’t even seem to be specific to the housing industry.
A quick glance at the screencast video that describes the offering doesn’t mention consumers either. It appears to be a Web-based lead management system with some auction-type functionality built in that allows buyers to bid on leads.
Are Lew Ranieri and Marcia Myerberg building a marketplace that reduces consumers and their loan professionals to ticks on a market board? Will that work?
I can see what they are trying to do in many ways. They have obviously had few issues:
1. Really getting the Root Exchange off the floor and perfecting their model.
2. Like many lead-gen companies (I know they are not Lead-gen, but for sake of simplicity) have had a tough time acquiring good buyers and I think this has to do with their short tail stratagy.
I see this has their way to remove themselves from the market as we see it. They are more familiar with the big banks and not the mortgage broker and this is their way of removing themselves from it. Between all the executives at Root they have plenty of connections in the world of finance and hope to capitalize on them. I think the major problem they have and will continue to have is their lack of insight to the consumer and the inability to communicate properly to them.
Joe Blackwell, and 
Can you give me a little more information on how this may work. Cost? Lead information? Do you purchase any area?? Thank you