Digital marketing is often derided as a poor way to generate quality leads. This generalization is even more pronounced when it comes to Facebook ads. Performance marketer and Facebook ad expert, Luke Shankula empathically disagrees. Whereas people see the lack of quality leads as a fault in the platform itself, Luke sees it as the result of a poorly harnessing its full potential. Marrying his background in the mortgage and loan business with his passion for marketing, Luke helps mortgage brokers and loan officers acquire more clients through his system of Facebook ads and automatic follow-up. Listen in as he joins Jen Du Plessis to explain why people misunderstand digital marketing and why it is truly the marketing tool that will set you up for an uncertain future.
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Generating Quality Leads Through Digital Marketing With Luke Shankula
I am delighted to have a guest with me by the name of Luke Shankula who is with Paragon Digital Marketing Group. He’s going to be talking to us about how we can be getting more leads with some digital assets per month. I’m not going to put the number out. I’m going to let you put the number out. He’s going to hold back and give us one little snippet during the Beyond the Podcast episode. If you’re a member of Mortgage Lending Mastery, don’t forget that you can check out the Beyond the Podcast in our private Facebook group. That doesn’t mean you’re going to hold out completely. You have a lot to share, but we’re going to say one little nugget for that part of it. I want to welcome you to the show, Luke. It’s great to meet you and I’m glad that we had the opportunity to chit chat in the green room before this.
Thank you so much for having me.
Let’s start with you telling us a little bit about yourself. I know that you were in the mortgage business and the mortgage space. You’re still in the mortgage space, but you were a loan originator. Tell us a little bit about your journey.
I worked for a reverse mortgage company up until 2017. In January of 2017, they shut down. They laid everybody off. I thought I wanted to start a contract processing business. I closed two deals. I realized I never wanted to do that again. I got my license to become a loan officer. I started messing around on Facebook, trying to figure out how to run my own ads. I fell in love with marketing. How I got into marketing is I was trying to do it myself. I did generate some leads but realized quickly that loan originator wasn’t the path I wanted to take. That’s what brought me into doing digital marketing because I had a background. I worked in the mortgage and I fell into working with loan officers, helping them generate their own leads.
A lot of times in life, it’s not what happens to you but what happens for you. Look where you are now versus they shut down all the reverse mortgages and here we are now. I’m glad you’re here and that we’re having this opportunity to chit chat. Anybody who’s reading this, rates aren’t going anywhere. We had a little blip of them going up and down and stuff. They’re not going anywhere. Most loan officers are now saying, “I don’t want ten leads. I don’t want twenty leads. I don’t want more leads, just go away.”
Let’s talk about what’s happening now in this market that you’re experiencing with and the people that you’re working with. What are you hearing from them? I imagine not everybody’s killing it. I coach people that come to me and they’re not killing it yet. That’s because they don’t have the right systems in place to draw the business. I want to talk about something else about that, but tell us what you’re hearing right now if someone’s reading and they’re saying, “I don’t want more business. I’m not going to read this episode.” I’m going to say, “Hold on because he got the answer.”Not having time is really not being very good with time. Click To Tweet
That’s true. We do hear that a lot. We work with a lot of decent producers as well and they’re super busy, but a lot of them understand that this is a long game. They’re building their pipeline for the future. The biggest piece that I see a lot with the loan industry is many people are stuck in the transactional mindset. They’re stuck in the day-to-day. They’re busy now that they can’t think about the future. The problem with that thinking is you get stuck when the market drops out. When you lose those rates that you’re getting right now, what happens? Where’s your business at? You’ve been focused on the present and picking up dollars now that you neglect the future. A lot of the people that understand that are continuing to spend on marketing. They’re continuing to grow their pipelines especially the people that understand that these rates are not going to be around forever. They’re building their purchase pipeline as well as their building.
Mostly what we do is purchase ads. We dabble a little bit with refinancing. Typically, 10% to 30% of what we deliver is refinance. I don’t generally like to work with people that are refi only because I find that they’re stuck in that mindset of they need to close more deals. There have been people that have stopped even though they’re getting results or even though they love our system. They’ve stopped and said, “I’m too busy right now. I don’t have time to call.” The reality is that happens and we get that. A lot of the guys, especially when they have teams, they’ve hired people to call the leads because sometimes they can’t do it themselves.
Refer them to me, Luke. Send them to me when they want to quit because they are too busy. I’ll help them.
That’s the other thing too. One of the things we find is that many people don’t have processes in place. They say they don’t have time but what that means is they’re not good with their time. They’re processing their own loans. They’re chasing conditions or doing all these things. As a loan originator, you’re a salesperson. You should be spending the majority of your day selling.
Hire somebody to grow. The good thing is I don’t have to ask my follow-up question because I was going to say that this is a short-term gain for long-term pain if we’re not careful. This is historically what happens with realtors and loan officers anyway. They do well when the market is great and they don’t do as well when the market isn’t good. We do a weekly call and I challenged all of my clients to think where you were a year ago, “Woe is me? What’s going on? I don’t know what to do.” COVID came, rates came down, and you’re busier than a bee. It’s being prepared for that. Let’s talk about what you are doing for the people to grow their business. I imagine that this is client acquisition specifically for loan officers. How is that then helping their relationship with their realtors if they’re referring people?
That’s part of what you would call a fuzzy ROI. To me, the beauty of a system like this is that we can get direct to the consumer. Traditionally, the flow of leads goes the opposite way. You’re cold calling 40 realtors on Mondays. We all know that whole spiel and all that stuff. I have nothing against that. As a marketer, I love all kinds of marketing. I don’t care if you’re cold calling, figure something out that works for you. I’m not going to sell you that Facebook ads are the best thing in the world just because that’s what I do. It just makes sense because it will work.
The reality is that there needs to be something like that going on. There needs to be some flow of business. The other thing I like to tell my people is you have to be a loan officer first. A lot of people are like, “I own these programs that generate a whole bunch of cheap leads that don’t convert.” Maybe they’re great leads but they’re missing out on the piece that matters which is closing loans on time and communicating all of these things. You have to be a good loan officer first before you start trying to dabble in giving referrals, all these kinds of things that everybody thinks that’s what the realtor wants. That’s something they do want, but the first thing that they want us is to close loans on time.
They want money. This is a challenge for realtors too. A lot of new realtors buy into Zillow and then find another loan officer who’s willing to buy into Zillow. I could probably name 4 or 5 loan officers that I’ve met that Zillow has been a killer for them. The rest of them are saying it’s a waste of time. That has a lot to do with sales skills, conversion skills and process skills. There’s a whole lot of skills that are missing that are perhaps the problem. I like that you’re saying get good at being the traditional loan officer first and then entertain bringing in the mass numbers so that you can streamline your sales time with everybody. Every conversation becomes shorter and shorter because you get better and better at it.
The other thing too is that many times loan officers or business owners in general think that getting more leads is going to solve their problems. They’re throwing a bunch of leads into a broken system and then they’re trying to blame the leads. You think that one person that’s worked with ten different agencies that’s bought Zillow leads, Realtor.com, and all these leads. There’s only one constant in that equation. Some of the leads do suck out there and there are a lot of bad providers out there as well. The reality is that the top producers understand that it’s a numbers game. They understand that it’s all about following up on what does that looks like. That’s one of the things that we do in our program. We help with the follow-up. We teach them how to sell. We have automation and all these things in place because I found out early on in my career doing this that getting leads was not enough.
That’s what I thought was important too. It’s like 1% to 10%. This is a small piece of the iceberg that’s sticking out. That’s what everybody thinks is important, but you need to have a follow-up process. The other problem is people think that it’s just taking the app, but if you take the app then how do you get the docs? What’s your process to get the docs? When you get the docs, what’s your process to get them with a realtor that can get them into contract? When you get them in the contract, what does that process look like? If you mess up any of these pieces of the puzzle, you’re going to lose that potential client.
It’s identifying, especially for conversion. I talk heavily on conversions because it’s an easy thing. Find out where your bottleneck is in your process. Where is the bottleneck and where is it falling apart that’s not allowing the conversions to go through? If someone is reading this and they’re like, “Not Facebook ads again?” What are some tips, thoughts or things that you can help them with? They’re not going away. They are never going to go away. This is the new normal. People at the beginning of COVID said, “It’s temporary. We’ll go back to normal.” This is the new normal and instead of trying to change the world, let the world change us. We have to accept that the world is changing. We can fold our arms and be bitter about it or we can say, “Let’s be better.” How do we make ourselves better?
As a loan officer and from my 35 years of experience in funding billion dollars in loans, I can say that you have to have multiple revenue streams when it comes to this. I’m not talking about being an investor and that thing. I’m saying you have to have multiple revenue streams in your practice. It can’t just be begging and pleading from realtors. You have to find some other avenues. What are some things that you’d like to say to those that are reading that are maybe naysayers or have their arms crossed and saying, “I don’t know,” just about what you do and how you help people with Facebook?Instead of trying to change the world, let the world change us. Click To Tweet
That is a real concern because everybody does talk a little bit bad about Facebook leads quality etc. That comes down to the way you want the leads. Primarily what people are doing is they’re running ads to a home’s list or they’re running it to a listing because it’s the easiest way to run ads. They’re working with an agent and they get, “Give me one of your listings. I’ll run ads to that.” While that’s great to generate a ton of cheap leads, the problem then becomes that you are dealing with people that wanted to see pictures of a house. While you’re getting $0.50, $2, $1 lead, mostly you’re getting contacts versus actual leads of people that are interested in buying a home.
One thing that I would say especially for loan officers is if you’re still going to continue to do a short form name, email, and phone number ad, switch to a mortgage angle ads. You’ll see a much higher level of intent. The quality comes down to a few different factors whether that be talking about 100% financing and talking about zero down programs. It’s going to attract people that have no money, bad credit, and all these things. You’re going to get cheaper leads, but the reality is that doesn’t matter. You’re trying to focus on the wrong piece of the equation which is the cheapest cost per lead. What you should be focusing on is the cheapest cost per acquisition and what’s your cheapest cost to get a pre-approval. How can you bring those numbers down versus the cheapest costs?
The other problem with most marketers and people that are running ads on Facebook is in my opinion, there are three types of ROI. There’s the monetary ROI which everybody talks about, but then there’s also the mindset. You’re calling through 300 leads to get one deal. You’re going to burn out quickly and then there’s the opportunity cost of your time. You’re spending so much time dealing with all these people that don’t want to talk to you, whereas if you can increase the quality of the leads. We do long form and filling out 10 to 14 questions or segmenting the credit. We’re looking for people that have 620 credit score or better and stuff like that to improve the quality. Also, the ad copy doesn’t talk about 100% financing and stuff like that. While your cost per lead goes up a decent amount, you will find that the quality is much higher, the intent is much higher and you’re starting to find the right people that are looking to buy a house, and not just wanting to see the 40 pictures that you promised them, that you then withhold.
I wanted to let you know that we are holding a virtual summit, Thursday and Friday, November 12th and 13th, 2020. It’s called Who Moved My Business? If you’ve ever read the book Who Moved My Cheese?, we’re taking a little spin on that and talking about how to position yourself best for 2021. Given the fact that we’re still going to be in COVID and more importantly, things are not going back to normal. They are going to be like this for the future because everyone has realized how valuable it is to be able to do virtual events.
I wanted to let you know that we are having that event. It’s a free event. It’s complementary. We’d love to have you join us for two days as we talk about everything and anything to help your business grow in 2021 by talking about Who Moved My Business? What are you going to do? Are you going to sit back or are you going to plan for the future because the future is a series of nows? What you’re doing right now affects your future. Come on over and join us.
Spend two days with us and learn as much as you possibly can to get yourself a great launch and jumpstart into 2021. I can’t wait to see you there. It gets down to the old saying of less is more and we all know what that’s about. Could you share with us one of your clients that you walk through this like, “Susie came to us and here was her dilemma, and here’s where she’s at?” What were some of her struggles as she went through in learning this process? How has she emerged on the other side with the success?
We’ve had people from all levels of success. We have one client, Dave who’s been with us for over a year. He was already successful in his own right. He was top 1% his entire career. He told me that he’s closing seven loans from our leads and he has another one that he might close. He had huge success but he was already successful. We don’t take any credit for that. He was a great salesperson already. We’re just providing him the leads and getting him the right system. What I like to see the best is when we can take someone from good to great or to that next level. We had another girl that just got licensed. She started to have some traction talking to people when COVID hit. She was like, “What do I do? How do I get more business?” How do you network with realtors? How do you do any of that stuff? She decided, “Let’s invest in this program.” One of the things we do is coaching. We have two LOs in the group that coach every single week on how to convert internet leads. They’ve been in the business and are doing leads for the last few years. They’re good at that.
They know that process.
It’s different than referrals. If you treat an internet lead the same way you treat a referral, you’re not going to have the success that you think you’re going to have. It doesn’t work that way. They have a few loans and underwriting. They’re closing a couple of deals. She told me that for 70, 75 days, they were trying to figure out how to work the system because they didn’t know the guidelines that great. We don’t like to work with people that have less than a year’s experience because of that. It’s hard to get good at being a loan officer.
The barriers are bigger.
It’s hard because you have to learn to be a good loan officer and you’re also learning to be a different type of a salesperson. Nothing against referrals. Referrals are awesome. Everybody should get more referrals. The problem is a lot of people think internet leads are bad because your conversion rates are much lower than with referrals. It’s a different level but I’ve also never seen someone build a business from 0 to 50 loans in four months as I did with one of our clients. They started a brand-new branch and within four months, they have 50 loans in their pipeline. We have never seen someone get that from referrals in four months. That takes time. You wonder why all these big companies or the Quickens of the world are spending millions if not billions of dollars on direct to consumer ads. It’s because it works.
It works with the right salespeople saying the right things which is what I want to do in Beyond the Podcast. What I want to do is ask you to share some quick scripts for people that get leads. Even if they’re internet leads. It doesn’t matter. The realtor gives three names and they’re the third guy. To me, that’s a lead. That’s not a referral. How do you convert those people quickly?Overnight success is a myth. People only see it as such because they didn’t see the grind that you put in. Click To Tweet
That’s one of the things I added. I started testing having coaches in the group. I launched the Facebook group for my clients as well. It was like a mastermind thing. That was one of the things that exploded the results for our clients. It was being able to get in a room and see what people are doing like in a Zoom room, not the exact room. It was good because we do roleplay sometimes or people ask specific questions about objections. We talk about what happens like, “How do you get the person from an application to get docs back?” That was one of the things I learned. At first, I was like, “They need to get the application,” then I realized that the problems kick down the road.
The problem starts coming along, the whole downstream part of it. Luke, if someone wants to get ahold of you and says, “I’m going to give this a shot. I am doing well. I’m going to hire somebody to take on these phone calls. I’m going to create another revenue stream for me because I heard the 0 to 50 and my whole branch could benefit from this.” What’s the best way for them to get ahold of you?
You can shoot me an email, Luke@ParagonDMG.com. That’s probably the easiest way. I’m also on Facebook. I built the majority of my business organically posting results on Facebook. If you’re not using organic social media to get clients, you’re missing out on a huge revenue stream.
Do you have a demo? Could someone request a demo to see what it would be like to work with you?
We generally do a first intro call with people and see if it’s even a fit. What I want to do is I only want to work with people that we think that we can help. At the end of the day, if someone’s only closing one deal a month, it might not make sense. They might have to grind it out a little bit more. It needs to make sense because the biggest thing with internet leads is it’s a long-term play. It’s 5, 6, 7, 8 months. We had one client who didn’t close anything for the first six months, but then she told me that she’s closing eight deals over the next 45 days.
It’s the stages of growth. People fail to understand that it’s a chart of the five stages of growth. The first is the formulation and there’s no business happening. The second is the concentration where you now have a formulation, a strategy or a plan. You go out and you implement it. You take action on it and by the repetitive nature of the action, making twists, turns, tweaks, assessing, and tracking, you then can create momentum. That momentum leads to stability which then leads to success.
What a lot of people don’t understand is that you could have a mortgage practice or a real estate practice that is twenty years old and it’s stable. You’re introducing a new revenue stream like Facebook ads. You can’t predict it. You can’t be in the mindset of, “I’m stable and successful.” You have to come down to the formulation and say, “For this, I have to reformulate.” That’s important for people to understand because I have 40 years of blood, sweat and tears that have brought me to my success. I didn’t become an overnight success.
Overnight success is a myth. They only see it as an overnight success because they didn’t see the grind that you put in.
They didn’t see all the years. In anything that you introduce new, make sure that your mindset and your expectations are that, “I’ve got to go through this process to get to success.” To some people it’s faster and some people it’s slower, but everyone goes through each one of those stages to get there. I think that’s key and critical. If you’re reading, this is my recommendation. I’m always about taking action. Go to the website and get some preliminary information. Schedule a demo to see if it’s even something you want to do. Let Luke and his team guide you as to what your next steps would be so that you could bring in another couple of more deals a year. Maybe you’ve never referred a realtor ever and this is so that you can refer a realtor. You don’t even care if it’s in your back pocket because that one referral could lead to 4 or 5 referrals from the realtor back to you.
I’ll tell a story about that same client that I was talking about. She didn’t close anything in the first six months. She told me that she had referred out five pre-approved buyers in a week. From one of those agents, she got back five deals. There’s the fuzzy ROI of doing this but it comes with a foundation that you need to be a good loan officer. You need to have good processes. You’re giving them business and you’re making them money, but if you’re also losing them money over here by dropping the ball, that’s not going to work either.
You won’t get them back. Reciprocation is good, but it will stop quickly if it’s not founded on a good quality client experience. Luke, thank you so much for spending time with us. For those of you that are not yet members of Mortgage Lending Mastery, go ahead and get signed up. For those of you that are members of Mortgage Lending Mastery, hang there because we’re going to put you into Beyond the Podcast. We’re going to talk about some scripting that you can use, whether you use this product or not, to help change, convert, and increase your conversions as well. Thank you so much, everybody, for joining us. Don’t forget to give us a great rating. Give us a great review so that we can continue to serve you. Thank you so much for all of the feedback that you give to me about our show and what I’m doing to make the world different for you. We’ll catch you next time.
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About Luke Shandula
Luke Shankula, a leading Mortgage Marketing expert and the CEO of Paragon Digital Marketing Group, is a great example of a successful business owner who believed in the power of digital long before COVID came into our lives to make us think differently. After 3 years of hard work, Luke has managed to build a 7-figure mortgage marketing agency, which, in the middle of a global crisis, is thriving. Luke is a former mortgage professional who gained vast experience in the corporate world before launching his agency. Since then, he has helped hundreds of loan officers and he is now more determined than ever, to help as many people as possible. Luke is not only working hard to grow his own business but he is also trying to give back to his community by sharing his own unique vision. He is getting involved with new initiatives and he loves to support other young entrepreneurs. Luke has spoken at several Legion of Loan Officer events and has also created a unique new 3-phase loan acquisition blueprint that promises to bring in new applications. As a successful entrepreneur, Shankula has a genuine passion for sharing his knowledge and techniques that will ensure others in the mortgage business become as successful as he is or surpasses him. Success in any endeavor is achieve-able when a set of solid, proven principles and practical techniques are followed. These are only made available by those who have done the same thing and achieve tremendous results and success. Shankula is one of the few people who are ready to share what gave them results. Instead of keeping his proven marketing techniques to himself, he derives so much joy from sharing his knowledge for others to learn, apply, and get massive results.
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