Joe Camerieri, the EVP for Client Account Management at Mortgage Cadence/Accenture, talks about what is the new normal in selling.
- Management transparency;
- Know the rules;
- Resist hiring people like you;
- Future is consumer direct and poor performers are not corrected by training.
Joe gives some key points on what he sees as the keys to the new normal in selling.
What Is The New Normal In Selling With Joe Camerieri
Our topic is what is the new normal in selling. I have an outstanding expert who’s going to share his thoughts. Joe Camerieri is the EVP of Accenture’s Mortgage Cadence. Prior to that, he was with LenderLive and prior to LenderLive, he was with PHH Mortgage as a sales leader. This is a great topic, but before we get into that, why don’t we talk a little bit about how you got into mortgage banking and managing?
It’s an interesting story. I was working in retail at that time. Anybody from the Northeast remembers John Wanamaker’s down in Center City, Philadelphia. I was going through the purchase of my very first home. It’s a two-bedroom cape in the same town I was born and raised in. I became fascinated by the whole process, but I was shocked by my 16% interest rate.
I felt that the home-buying experience and the whole process of mortgage were fascinating. I left a career in retail and joined a bank called PSFS. I started my very first job as a closer, which was a perfect place to start because everything ran downhill to closing. All the issues of the previous 30 days have to get fixed before the loan goes to the closing table. It was an accelerated learning a lot about the origination business.
From there, I got into managing by growing up like many people do in the mortgage business. I worked my way up functionally until I was a vice president of closing. I had the opportunity to do a bunch of things at PHH back in the day. I changed their business model and started getting the correspondent and the relocation business. That’s when I started to get involved in sales functions, loan originations, and business development.
What was the best advice that you got when you started managing? Were there books or things that you used as resources to improve managing?
I got some great advice. I’ve been incredibly fortunate to have great mentors on the way. I’m sure you even learned things about leaders that you’ve worked for that weren’t so good. I learned as much there as those who I thought were fantastic. There are two things that stick to mind. Both came out of the experience as well as being mentored. The first thing is transparency. Managing adults is like raising or managing kids in a classroom. They do want to know the rules, what’s good, what’s bad, where to start, and where to stop. Having no ambiguity as it relates to expectations and over-communicate about what’s going on, what affects their job, and what success looks like.Managing adults is just like raising or managing kids in a classroom. They want to know the rules. They want to know what's good and bad, where to start, and where to stop. Click To Tweet
That was the first thing. The second thing which took me, as a manager, a little bit longer to learn but is probably one of the more powerful lessons is that every manager wants to train and retrain their poorest performers. One of the lessons I learned from a Dale Carnegie coach is that that’s the worst thing you can do. People who are bottom performers very seldom, it is a lack of training and something else gets in the way. It’s a lack of motivation and general skills. Perhaps it’s a lack of desire, but the real bang for your buck from a training and development perspective is those folks who are struggling to be good and helping them raise the bar where they’re better and fantastic.
I can’t agree with you more. I certainly have spent many years on this issue. I know what you’re saying. Your instructor was right. Why don’t we talk about what was the greatest victory in your career? Likewise, what was the greatest lesson that you learned in your career?
A big part of my career from a sales perspective was B2B. There was a direct bank out in the Chicago area that I had been trying to sell to for a number of years. Years ago, I was able to get a contract from that financial institution. My sales cycle was 22 years and 11 months. I talk about persistence. Throughout that time, there were 7 or 8 leadership changes, strategy, and name changes in that institution but I finally got a contract signed for them. From a B2B sales perspective, that was one of my greatest victories.
It’s certainly a lesson in persistence. That should be inspirational for our listeners. On the flip side, what was the greatest lesson? It sounded like working with poor performers was one of them but were there others?
I used to love these self-help seminars. I couldn’t get enough of them as my career went on. One of the things that were obvious was a whole concept around leadership psychology. As a leader, you tend to surround yourself with people and pick people or direct reports that are like you because like goes to like. It’s a natural human thing. The lesson I learned was to resist that at all costs.
When you’re building your team, you should surround yourself with people who are not like you, will challenge you, and have different skillsets than you and embrace the fact that everybody brings a different perspective, skill, and view on how things can move forward. I purposely did that in one role. I was managing over 300 sales consultants and building out that leadership team and magic happened. It was a great lesson I learned. I put it into practice and saw the value with wonderful results.
Too often, people do hire people like themselves, which is not a good thing. That leads us to our topic. What is the new normal in selling from your viewpoint? It has been somewhat traumatic for mortgage lending, especially from the standpoint that we have a tremendous amount of volume, but then we’re now facing an issue. There‘s so much volume that you don’t see people planning for the next year. You see a lot of the principles that they should have not been there. Why don’t you talk about your thoughts about what the new normal of selling looks like?
It’s funny because if you look at our environment with COVID and think about what will happen, what will go back to normal, and what will be the newer normal post-COVID, I tend to believe that the sales process is not going to go back to the way it was. Everyone has predicted since the early ’90s that the whole mortgage industry was going to go consumer-direct. PHH bet the farm on it if you know anything about that organization.
It has taken a pandemic for the entire industry to go consumer-direct, even your distributed retail loan officers who have worked for years in a face-to-face environment and physically touched base with the referral sources, any entertainment, and all those types of things. We’re now in a space where every consumer is interacting with a salesperson, whether they want to or not, in a consumer-direct way.
That’s going to stick, especially if we remain in a COVID environment and move into a purchase-money mortgage. Call centers and purchase-money mortgages tend to be oil and water, but life will find a way if we find ourselves in the spring home-buying season still home-bound. The new normal is going to be a real embracing of consumer-direct. There’s going to be a higher embracing and adoption both from a loan officer standpoint as well as a consumer with the use of technology. This may have forced us to turn the corner on what everybody has predicted since the early ’90s.
I would even argue that in distributed retail, granted it is tasked with being face-to-face, what I saw and still see even in 2020 is that the originators are inside salespeople. They have a job title and responsibilities that lend themselves to hoping that the originator will go out, but most of the time, they’re not anyway. The other thing is that when you look at consumer–direct, for companies to jump into it, it does lend itself to how you are going to get the leads. This is always the issue. You could jump into consumer–direct, but if you don’t have a strategy for lead development, you are not going to be successful. What are your thoughts on that?
I couldn’t agree with you more. An old wise New York attorney told me one time that being in the leads business and lower my bills is part of the LendingTree was like owning an ice house. He said, “At the time that everybody wants the ice, it’s the most expensive time to make it. When nobody wants it, it’s the cheapest. It’s an easy time to make it.” You hang out a shingle, and your phone rings off the hook. Consumer-direct is the delivery of choice.
There will come a time when rates go back to normal. Purchase-money mortgages will be 65%. Purchasing leads will be an incredibly expensive thing to do if you’re in the consumer-direct space, but some innovative models are being developed out there. There are lenders who are creating their type of capabilities to generate leads like the companies they buy leads from. There are joint ventures being put together with online real estate firms.
Realizing that we are still in a housing shortage will be quite some time, at least until that changes. Not everyone is going to need a full-blown full-service realtor to move their home, depending on their neighborhood. There are some innovative strategies taking place out there to be able to attach a call center loan officer and get them to the point of sale for purchase-money mortgages. What we’re going to see moving forward is less reliance when purchasing leads and more reliance on investments. It’s like, “How do I get my call center the point of sale through these other various mechanisms?”
If you added Quicken to the numbers that we see, the consumer-direct has already moved to be a dominant strategy within mortgage banking. You also see this issue that the hiring of loan officers in distributed has been at a rapid pace in 2022 and some of the prior years. We still see the traditional loan officer role that is not consumer-direct, still surviving, doing well, and receiving fairly high compensation. Do you see that all coming to an end or it’s going to realign itself and therefore move into consumer-direct as the dominant model and pattern?
I see it all coming to an end but I will likely not see it predominantly come to an end. Pat, you and I have talked about this. The average prolific loan officer and prolific real estate agent are in their late 50s. This industry has not necessarily done a good job, partly because of the credit crisis in attracting young people to operate as distributed retail loan officers. The influence of those two parties will wane as that wave of mortgage industry professionals retire. For all intents and purposes, it will be replaced by consumer-direct.
As a young realtor who just got a license, you don’t wait in the office for somebody to come in the door. You get leads on the website. Until a point in time when that prolific loan officer and real estate agent retires, they will have a hold on the purchase-money mortgage business. With every year that goes by, there will be increasing use of technology and call centers, and consumer-direct will start to take over market share over the next 5 to 7 years.Every year, there will be increasing use of technology, and call centers and consumer direct will start to take over the market share over the next five to seven years. Click To Tweet
I certainly see it similar to you. When you look at Quicken’s IPO filing that they made, what I thought was interesting about it was that they have set their company up to do the lifespan of a consumer. It does raise the question that, as a single product and mortgage lender, even when you look at Quicken, they are transferring and cross-selling to do auto loans and other types of products. Do you see that happening with independent mortgage bankers, or is Quicken an anomaly?
I think Quicken is not an anomaly. However, you’re seeing that happen in other industries but it’s the same concept. As you see Quicken going less deep in the mortgage business but wide with other products, you see an organization like SoFi that’s already deep in student loans now going wide into the residential mortgage industry. I do think it’s a strategy and the right approach.
How many cycles of business have we lived through where an independent mortgage banker is on the big brink of bankruptcy when rates rally and drop 50 basis points, and they’re saved yet another day? By going wide, there are some financial products, as any financial institution or bank can tell you, that are countercyclical to the mortgage business. The mortgage business is tough.
There are build consolidation opportunities and personal loan opportunities. By offering a wider view of products, there’s a way of leveling out your business. You’re always generating some stability as it relates to revenue. It all depends on how savvy the mortgage banker is and whether or not they want to branch out that way to become more full-service or financial service providers versus being residential lenders.
That’s a great point. It does start at the top. I do think that Quicken is leading the way with a lot of those strategies, so they are on point. Our time has flown by. What would you say would be a couple of points for our readers about the new normal of selling?
Embracing the technology that’s available is key. The adoption rate for some of the technologies that check your income, bank statements, and Fannie Mae, even in this environment, is all hovering in single digits as it relates to the percentage of people. Embrace the technology and utilize those tools. The industry has done a great job giving very innovative tools to originators and at the point of sale but there’s a tremendous opportunity to take costs and leverage technology out of the back office manufacturing. There hasn’t been the same focus that has been given to the front end.
The same thing I would say is that it’s now an issue of utilizing the technology we have had. I do think one of the benefits of this latest saga in 2022 has been some of the technology being used. I want to thank you, Joe, for sharing your thoughts. I certainly want to remind our readers to subscribe and rate this episode. You can sign up for my weekly sales tips at www.PatSherlock.com.