Sidney Wager (pictured), managing director of L&C Mortgages, said the mortgage market needs to “realise how pivotal the moment we are in [during] the journey of the mortgage industry”.
He explained: “I genuinely think this is our Blockbuster time or our Blackberry time. There are loads of historical examples of where you probably haven’t had enough foresight to look forward and start to see the perceived challenge in competition, and where it’s coming from.
“We’re in a fantastic place to be able to think forward, carefully and sensitively about: Who do you want to be? What do you want to be known for? Why should customers choose us?”
Looking at the mortgage market, Wager said he believes there is “no such thing as the “steady state”.
Wager said the “rule book” that was “written 20 years ago probably doesn’t bear any resemblance to the reality of today”.
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He noted that while some economic principles would remain the same, economic cycles would shrink and there would be shorter waves.
Wager said the pandemic “changed a lot” and the “element of seasonality doesn’t exist in the way that it did previously”.
“The movement in technology facilitates that [market] movement faster than ever before. Some of the barriers to entry that we may previously have seen or perceived will become increasingly softened by technology, which means that you will potentially see competition coming from places you previously had,” he added.
When asked about the barriers to entry for the mortgage market, Wager said it was “perceived complexity”.
Wager said future success will be around “agility” and identifying opportunities and how they change.
“The reality is if you’re not able to be agile in thought and fleet of foot to look and seek those opportunities, that’s where you’re going to struggle,” he said.
Wager added that from a performance perspective, L&C Mortgages continues to grow, which was “phenomenal”, but it “would be misguided to think that the way you’re growing today will be the way you grow tomorrow”.
He said to make sure your strategic partner is the “right one going forward” and identify whether you need to diversify or invest in technology that “drives efficiencies and makes you more productive, which means that you’re able to optimise”.
“We really feel that, especially around our purpose around genuinely putting customers first, is a journey and there’s a long way to go to really make that a genuine and true reality,” Wager said.
‘We will be more data- and consumer-led than ever before’
When looking at growth, Wager said there are several ways to grow, including partnerships or mergers, to name a couple, but he “wouldn’t include or discount anything” as it wanted to remain agile.
“There’s often that really fine balance between do it yourself, or partner with somebody that already does it and have an opportunity to grow or build it yourself. That’s always going to be a challenge, and that challenge won’t go away,” he said.
Wager said L&C Mortgages would invest in technology, but it was crucial to differentiate between artificial intelligence (AI), data and data automation.
“We will be data- and consumer-led more than… ever before. We will employ and deploy the right technology at the right time, at the right points, in the right place in our journey,” he added.
When asked about recruitment, he said he had “always been open to making sure that you have the best people in the right place doing the roles that you need them to do, and that that’s always going to be a journey”.
“It’s not about whether you are going to recruit or not. You need to continually recruit, refresh, embed, existing, develop existing employees. It’s a continuum. It’s not a ‘now’s the time to just recruit, or now’s the time to put the brake on’, because actually… I think that this whole market is at our pivotal point.
“It’s our most pivotal point where actually… we don’t necessarily even know where the threats or real competition’s coming from. It’s not necessarily from within our existing market. The threat could be way outside our existing market. In fact, it could be people we don’t even know, think about or anticipate,” he said.
Wager said firms “need to be thinking about how do you continually and consistently make sure your business stays relevant?”
“You’re going to need to pull all the levers. You’re going to need to make sure that you consistently stay relevant for consumers, so that when they’re looking to buy, looking to purchase, think about a mortgage, I want to consistently be the favourite brand that people defer to, I want to be the most memorable,” he noted.
L&C Mortgages looking at consumers via ‘behavioural lens’
Wager said L&C Mortgages had “started looking at consumers through a more behavioural lens… as opposed to thinking about them through what I call their journeys”.
He explained: “For instance, a first-time buyer and a second-time mover are journeys, they’re not behavioural traits that consumers identified with. Therefore… you need to think about [the] consumer, not the journey. Traditional journeys are a byproduct of a consumer behaviour.”
Wager said L&C Mortgages had looked at demographics, socioeconomics and different traits and identified “very discreet cohorts of customers”.
“There are different customers, so what we need to do is ensure that we have journeys. We are omnichannel, so you can choose to come into L&C, whichever way you choose to come in, we have a journey that will take you where you need to get to.
“That’s not about the journey of the customer, that’s about how do you behaviourally choose to engage with us? Some consumers are happy to come in [from] one direction, but may need to feel the need to switch across the channel because we will provide a digital journey to cater for you,” he said.
Wager said “consumers are always going to need advice” and there will “always… be a space and a role for advice, but there will be different types of consumers”.
“There will be different entry points and there will be some that want to consume that in a different way,” he noted.
Wager said AI is vital as it “will help us genuinely understand what our customers think”.
“We found that customers fitted into a number of very discrete buckets, some of which was about the propensity to receive and consumer AI… others are completely the opposite end and a bulk in-between.
“If you constrain yourself by thinking you need to do it a particular way, you’re losing the ability to have that criss-crossing of the journeys for clients. That’s the way you better nurture your existing clients as well as nurture future clients on their journey,” he added.
