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Today''s brand of mortgage company. (Cover Report: Industry Trends).

Article Excerpt
Washington Mutual Inc., Seattle, has found a powerful business model to capture and retain mortgage business. Four elements are at the core of its approach: a powerful brand, smart technology, innovative loan programs and strong relationships.

THE MORTGAGE BUSINESS HAS NEVER been at this particular crossroads. All around us we find a consolidating industry coupled with a period of record-low interest rates and a volatile economy. Many lenders are struggling to keep up with today's loan demand in this low rate environment and wondering what it will take to survive and sustain a healthy business in the future.

* How will mortgage companies successfully manage the biggest refinance boom in American history; while preparing for the eventual rise of interest rates? How can smaller and midsize mortgage companies compete in an intensely consolidated market? How will large mortgage companies protect themselves against runoff and maintain market share?

* If good companies need to reinvent themselves every five years, what's the next new invention going to look like? The recipe for building a successful business in today's complicated economic environment includes four key ingredients: strategic branding, smart technology innovative products and maintaining key relationships. The new mortgage industry mantra should be something like "Change is good; customer is king." The new recipe for success will help our industry improve its efficiency and offer better products and services to consumers. Companies and individuals that embrace this change will succeed, and those that choose to live in the past will not.

A brand can deliver real value if it reflects your business

One of the myths of the mortgage industry is that brand recognition does not exist and is not important. It is true that mortgage companies typically have low awareness and offer a product with low frequency of use, but building a sustaining brand is critical to the long-term success of any business-to-consumer (B2C) or business-to-business (B2B) enterprise in today's economy.

A strong brand is important because it enables companies to command a premium value for products and services; builds market share; motivates employees and partners; helps sustain momentum during market swings; and builds recognition in new markets and with new channels. In addition, for retail and wholesale mortgage lenders, brand can successfully influence lender preference.

Take for example some "category killers" such as Disney, Coca-Cola and Southwest Airlines. There's no mistaking that "fun, family entertainment" is Disney's mantra. No company has been able to, do theme parks and family movies better. Coca-Cola's brand value is estimated to be nearly $70 billion. This value is in the form of customer goodwill, meaning the value of the tendency of loyal drinkers to buy Coke over other soft drinks. Southwest Airlines is an industry leader in efficiency combined with providing excellent customer value. Its focus is on getting more people to their destinations on time, and the company reinvented the typical airline business model to succeed at this. This efficiency not only builds customer loyalty but makes shareholders happy as well--Southwest Airlines' market capitalization exceeds all other U.S. airlines combined, according to the company.

The value in consumer brand awareness is not limited to theme parks, soda and airlines; the mortgage industry, too, can benefit from building powerful consumer brands. "Many in the mortgage industry believe that brand doesn't matter because mortgages are a commodity," says Rick Barrera, author of the soon-to-be-published book, TouchPoint Branding.

"Many...