The aggregator market is feeling the squeeze as consolidation continues - so how are smaller players competing with the big end of town? We speak to GREG MITCHELL of Homeloans and BRENDAN O'DONNELL of Liberty Network Services for their thoughts on the changing industry.
Video transcript below:
Donna Sawyer, Australian Broker TV
Donna Sawyer: The aggregator market is feeling the squeeze as consolidation within the industry rolls on. Homeloans is the latest to take the acquisition path with its purchase of the refund network. Speaking at the 2012 MFAA national convention, Greg Mitchell of Homeloans said the move aims to boost the company’s impact.
Greg Mitchell, Homeloans
Greg Michell: Well over the last couple of years we have been trying to increase the exposure of Homeloans within the marketplace and get like minded brokers to come on board with us. And this is basically a free kick that we have got, because there is such a presence, there is a 170 contracts that we sent out on Friday. So if we get a majority of those, those franchisees on board, it just gives that presence in the marketplace.
Donna Sawyer: And even though he is optimistic, he says conditions have been challenging with the big banks pushing into the market.
Greg Mitchell: It’s been tough. I mean the GFC and the major banks have penetrated the market aggressively. So yes we have certainly found it very difficult to actually as we said before, trying to actually find or even keep the brokers that we have got on our panel in our best business. So I think it’s imperative, probably the smaller sort of players kind of start to grow to be more of a presence out there in the marketplace, so we can actually be a true alternative.
Donna Sawyer: And with consolidation set to continue any new players in the market will have to fight to survive. Brendan O’Donnel of Liberty Network Services which launched in November last year, says the key has been offering a 21st century proposition.
Brendan O’Donnell, Liberty Network Services
Brendan O’Donnell: It’s a hybrid model, it’s taken into account all the franchised operations and branded businesses that exist in the marketplace. It’s taken into account all the traditional aggregators. We have looked at I guess the best of both worlds in terms of what’s available. We understand brokers, clearly over the many years and we have broken the barriers to entry and to exit down with the broker in mind.
Donna Sawyer: He says branding and technology are vital battlefronts for those looking to build their distribution networks.
Brendan O’Donnel: So firstly marketing and branding support is coming of age. Secondly in terms of technology, yes there are some very good technology platforms out there, but most have been bought without the broker in mind and what I mean by that, if you look at in terms of productivity and in terms of process, it’s really important to manage those two. So what we have done is, we have developed a new age revolutionary platform called Spark, which is mobile. So you can actually engage your entire business, from lead to opportunity, CRM, all the way through to dealing with the client and the application on your ipad.
Greg Mitchell: Coming from a larger bank background, I honestly do think there is that ability for us, the non-banks to actually be that presence. I think we have to be smarter than what we have been in the past. I think you need to diversify.
Donna Sawyer: This is Donna Sawyer reporting for Australian Broker TV.