Social media key to company's growth
New Zealand Home Loans plans to grow its business by at least 50 per cent in the next three to five years by building its brand through social media and community partnerships.
The Hamilton-based home loan provider, owned by by state-owned Kiwibank, plans to achieve a 50-60 per cent lift in top line revenue through new partnerships and promotion in the nationwide communities it operates in, said chief executive Mark Collins.
The franchise operator was on track to mark $1 billion of home loans this financial year. It had aimed to hit this mark last financial year but came in at June 30 about $40 million short, he said.
Collins said the growth plan was bold for a mature business - it is 16 years old - given most established businesses were consolidating.
The company, which focuses on guiding, and regularly monitoring, clients' efforts to reduce their debt as fast as possible, claiming to assist in knocking 5-10 years off mortgage repayment times, has 60 franchises and was recognised in the Deloitte Fast 50 awards last month.
It was named 'fastest growing mature business' in the Central North Island and was the only home loan provider to get an award.Collins said debt reduction was now the ''barbeque conversation''.
''Five to seven years ago it was your latest rental property purchase. Now it's 'who are you with (lender)?'. At the end of the day, everyone needs help.''
He said NZ Home Loans was not a broker, and not a bank.
Its brand was the country's ''best kept secret'', and as a referral-based network the company rarely advertised. I
t did not have a big budget for advertising campaigns and promoted its brand through sponsorship of grassroots community activities and social media, which suited its ''network'' nature.
''A lot of our clients interact and we have 4000 Facebook friends which is phenomonal for the size of our business.
''We also put a lot of relevant content up, because the key to social media is content.''
There were two parts to the NZ Home Loans business, Collins said.
One was lending to home buyers needing 80-85 per cent finance and more, the other was helping people refinance their homes.
''These people we can really help. We can help them take 5-10 years off their mortgage with no change to their behavioural model.
''It takes 15 minutes at a bank to get a home loan. With us you spend one to two hours - we have a bit to explain and we want to understand everything about you. And we have the ability to regularly monitor the (repayment) plan - we don't leave you alone.''
The company meets with clients three to four times in the first year to help monitor repayment progress and regularly after, he said.
Through a debt management software system called debtnav, customers could also monitor their own performance.
Collins said more franchises are planned. Most of its operations are in Auckland where there had been a sharp spike in activity this year with 41 per cent of all business coming out of the region in the past three months compared to 29 per cent in the same period last year.
The company was founded by John Erkkila and Murray Ferguson in 1996.
Kiwibank bought out the company in July after purchasing a 51 per cent controlling stake in 2006 which it has progressively increased.
The company has an independent board headed by Waikato-based entrepreneur Neil Richardson.It accounts for 30 per cent of Kiwbank's mortgage business.
It has 200 consultants nationwide, 50 of whom are employed and the balance, including business owners, on commission.