Without audience targeting are Google Ads Dead? Think again…
Early this month Google announced new restrictions for targeting specific audiences. The restrictions apply to content related to housing, employment, credit, and those who are disproportionately affected by societal biases. The news of these restrictions created quite a stir among industry brokers and lenders who heavily rely upon targeted Google ad campaigns. All which may have you asking if these changes will kill future reverse mortgage advertising on the world’s most popular search engine. In just a moment we’ll hear from our online SEO expert Josh Johnson to find out.
Google’s restrictions are not necessarily novel nor unexpected. It was just over two years ago Facebook faced scrutiny from federal regulators for allowing those offering credit or housing finance to restrict ad audiences by race or religion among other questionable metrics that would violate HUD’s fair housing rules. An investigation by ProPublica broke this news in October 2016. It was nearly two years later in August 2018 that HUD filed a formal complaint against the social media giant for discriminatory advertising practices. Seven months after HUD’s complaint Facebook announced sweeping changes. Both Facebook and later Google, took a blunt approach much to the chagrin of lenders and service providers.
What ad filters are going away? In its official release Google revealed, “credit products or services can no longer be targeted to audiences based on gender, age, parental status, marital status, or ZIP code.”
Is this the end of Google ads for reverse mortgages? To answer that question I reached out to Josh Johnson who heads up Reverse Focus’ Online Dominance SEO program and Google marketing. Here’s his explanation.
Here’s what makes Google unique from other platforms and why reverse mortgage Google ads will continue to reach the intended audience.
To summarize, older homeowners are intentionally seeking out reverse mortgage information on Google which means, yes-your ads will be seen by your target audience, even though you can no longer target specific age groups.
How a fixation on mortgage elimination could be costing retirees
Robert and Lisa Brown have been married for 35 years, have nearly paid off their home mortgage, and have over $200,000 in retirement savings. Having been retired for 5 years they can easily pay all of their monthly expenses. Last week they received a mailer touting the benefits of reverse mortgages and how one can stop making their existing mortgage payment. “No thanks”, they said as they tossed it in the kitchen trash.
While this is a hypothetical scenario it exemplifies one possible reason that reverse mortgages may not have gained more market share among age-eligible homeowners in the U.S. The issue? Perhaps it’s selling a benefit that millions of homeowners may not want or even need. While 80% of respondents to our recent HECMWorld survey said eliminating the mortgage payment was the primary motivator in getting the loan, how many households are completely unaware of the myriad of ways a reverse mortgage can be utilized? Most I would venture to say.
In 1992 Apple founder Steve Jobs told Business Week, “A lot of times, people don’t know what they want until you show it to them.” Could such a bold statement hold water in our industry? Well, first consider this. People don’t know what you haven’t told them. Just as Jobs showed people gadgets that no one knew they wanted until he took the stage, many homeowners have no clue how a reverse mortgage could be used to secure their future. And that lack of knowledge can be costly.
Going back to our hypothetical couple let’s say five years later Robert is diagnosed with ALS. While their mortgage is now paid off they instinctively go to their most obvious source of funds; their retirement account. The problem is their stock values and the market have dropped an average of 30% from where they were when Robert was healthy. Seeking experimental treatments in a desperate attempt to stave off the disease they cash in their stocks…at a loss.
Could these grueling choices have been avoided had they got a reverse mortgage five years earlier? There’s a strong possibility they could have. But they didn’t know they could have taken the loan and built up an emergency source of cash for such a financial shock. Nobody told them. Over the subsequent years as each mailer arrived the impression that a reverse mortgage is only for eliminating an existing mortgage payment was reinforced. And that’s the challenge. What if instead of a typical marketing promotion they received a letter entitled ‘5 things you didn’t know you could do with a reverse mortgage’. Since they don’t NEED to pay off their home you may have their attention. Reading further they discover that some retirees chose to refinance their existing mortgage into reverse and then continue to make mortgage payments to build up a future credit line they’ll have access to should they need it. Or they learn that homeowners who don’t want to see the loan balance eat into their equity so quickly make a payment that’s about half of what they’re paying today. Again, they are building up access to loan proceeds as long as they stay in the home and meet the conditions of the loan.
Traditional planning yields traditional results, much like the Browns who found themselves with a mortgage-free home and having to raid their retirement nest egg to care for a spouse. Is it tragic? Certainly. Is it avoidable? Possibly…IF homeowners are fully informed of their choices when it comes to repositioning their home’s value for such occasions. Fortunately, several lenders are now emphasizing the incredible flexibility of a HECM. Informing homeowners of their choices is no simple task. It requires a concentrated effort in new messaging and disciplined fact-finding, but it can be done.