Diversifying pays dividends Part 2
Origination News 4 May 2015

Part 2 - The “knock-on” benefits from marketing new products to your existing clients – referrals (new clients).

In Part 1 of this series we demonstrated how you can create additional opportunities from marketing new products direct to clients within your existing data base. In our real case study we showed you how a broker generated an additional $13,537.50 in upfront commission, and is also set to earn additional trail commission in the first year of approximately $6,700.00 (don’t forget – no clawback) just by marketing a new product to their existing data base of clients – with just one email, and the willingness to try something new.

In this edition of the series, we focus on the additional benefits that can be obtained by marketing new products or ideas to your existing client list, by getting clients talking about them, either at home, work, on the golf course, or at a family BBQ. By creating a talking point you are extending your advertising reach, hopefully resulting in more enquiries from new customers.

Case study

A broker located in Melbourne, recently settled their first multi-unit construction loan with La Trobe Financial - construction of 8 units in Brunswick which he arranged for his son. The broker had not attempted construction finance previously as he was unsure how to do it, but with the help of his SMCP and having direct access to the credit team, the broker successfully completed the transaction for his son.

On realising that the process was actually quite simple (we offer a standardised process that applies to all of our loan products), the broker decided he would market the product to his existing database of 250 clients, to see if he could raise any enquiries for this product, writing more business as a result.

Not only did the campaign result in direct responses from his existing clients, much of which was unrelated to construction finance, the campaign actually generated enquiries from people new to the broker – friends, family and acquaintances of the broker’s clients.

In this real example, one of the broker’s clients shared the product information with his friends over dinner that weekend, as he was aware that some of them often participated in small property development projects from time to time, and that one couple in particular were close to finalising plans for a 4 townhouse construction project in Kew, Victoria.

The sharing of information worked. The couple contacted the broker on the following Monday and lodged an application for construction finance 2 weeks later for $2,350,000 to complete the 4 townhouse construction project in Kew.

  • Example A – Loan amount $2,350,000

    Upfront commission earned: $11,750.00
    Ongoing trail commission earned: $3,525.00 p.a. (based in progressive drawdown basis)

    In addition to the loan referral above, another of the couples in attendance at the client’s dinner party that night also lodged an application, 6 weeks later for a 2 townhouse construction in Brighton, Victoria for $1,600,000. In order to raise enough equity to complete the project, the applicant agreed to refinance 3 other properties – loan amounts totalling $2,900,000.

  • Example B – Total loan amount $4,500,000

    Upfront commission earned: $22,500.00
    Ongoing trail commission earned: $11,250.00 p.a.


These 2 real examples demonstrate well that diversifying pays dividends. It also highlights the possible “knock-on” benefits that can be generated by marketing opportunities to your existing clients for new business, and this was only one effort. Get your clients working for you to uncover new opportunities.

Now if you are reading this and thinking, that all sounds great but I don’t do construction finance, or I’ve tried marketing to clients and it didn’t work – great, you are exactly who we are appealing to. You are leaving business on the table, or worse, leaving it open for others to capitalise on. Now is the time to try, let us help you. Call your Senior Manager Client Partnerships now, or our credit team direct on 13 80 10.

Part 3 in the series..

In Part 3 of this “Diversifying pays dividends” series, we will show you how a broker was able to create additional opportunities by marketing new products publicly, establishing themselves as a “finance expert” by demonstrating their ability to cater for a wider market.

Until then, best of luck with your business.

Best regards,

Cory Bannister
Vice President, Head of Distribution

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La Trobe Financial is one of Australia's leading independent credit specialist Fund Managers. Its business includes residential mortgages, commercial mortgages, and investment services operating one of Australia's largest Mortgage Funds under AFSL 222213. It employs over 130 staff and has managed over AUD$10 Billion covering over 100,000 investment grade assets since inception in 1952.

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