Mortgage-Related Trends on Google

googleAlmost one-third of Canadians do all of their mortgage research online, according to CMHC. That indicates how important Google has become to consumers, lenders and mortgage brokers.

To get a better sense of mortgage trends on the world’s biggest search engine, we spoke recently with David Resnick. Resnick is Head of Industry – Financial Services at Google and he offered up some intriguing insights into Google’s mortgage-related searches.

It turns out that mortgages are a red hot topic on Google. “Mortgages are the fastest growing (search) sector in financial services by far,” says Resnick. “The number of Canadian queries related to mortgage products and services is up 60% year-to-date.”

We asked Resnick for his thoughts on a range of topics, including:

Are High-Ranking Brokers Better?

  • Does a high ranking in Google mean a broker is reputable and well qualified?  Resnick says, “Those who have got to the top of Google probably take their line of business quite seriously. But that’s not to say they’re the best mortgage broker out there.”
  • He added: “They’re probably very dedicated to online marketing. I wouldn’t necessarily place more weight on them as a consumer.”

Frequently Searched Terms

  • These are mortgage terms that were heavily-searched in 2012:
    • “Mortgage calculator” (This one overtook the search term “Lady Gaga” earlier this year.)
    • “Mortgage rates”
    • “First-time home buyer”
    • “New mortgage rules” (one of the fastest growing terms this year)
  • The term “BMO 2.99%” saw a major volume spike in January 2012. That coincided with BMO’s headline-making 2.99% mortgage special. Its heavy search volume persisted until March/April, when the promo ended.

Google AdWords

  • Google AdWords is an auction-based pay-per-click advertising service. It “levels the playing field between large and small advertisers,” says Resnick, because advertisers can spend as much or as little as they want, on targeted search terms, with no commitment.
  • Mortgage ads are highly competitive, though not as much as auto insurance advertising, which is the most competitive category of all.
  • The number of consumers searching Google for mortgage information is growing faster than the number of advertisers paying for mortgage ads. Given that AdWords is governed by supply and demand, this has ensured a “very good return on investment” for those buying mortgage keyword ads.

The ranking of an AdWord ad depends on the:

  1. Relevancy of your ad to a user’s search term(s)
    • Click-thru rate is “the most important factor,” says Resnick
  2. “Bid” size (i.e., the amount you’re willing to pay)
  3. Quality of your landing page
  4. Relevancy of the landing page
    • i.e., did visitors stay on the page or leave and come back to Google immediately? Google gives a better relevancy score when visitors hang out on your site for a bit.
  • “Ads that typically do well incorporate mortgage rates or a call to action (like ‘Contact us now’),” says Resnick.
  • 10-20% of all mortgage-related queries are now occurring on mobile devices.

Choosing Keywords

  • Google’s Traffic Estimator predicts how your Google Adwords ad will rank based on what you spend and the keywords you choose
  • Keywords like “best mortgage rates” have many bidders, which isn’t surprising since 86% of those who research mortgages online search for rates. (Source: CMHC)
  • If you’re a broker or lender who has never tried Google AdWords before, here’s a $75 free trial.

#1 Tip for Brokers Wanting to Rank Higher

  • “Make sure you’re doing everything the Webmaster site tells you to do,” says Resnick. Specifically, see these guidelines.

Rob McLister, CMT

  1. As someone very involved in site optimization and Google adwords for many years I have reached the conclusion that the only people making money from all this is Google and the consultants.
    There is so much competition in our our space and the competitors (the banks) have such deep pockets we are just throwing money into an ocean of click throughs.
    The rate sites do work be they are super specialized however if an individual brokerage thinks they are going to enjoy great success and show a solid profit from SEO and Google Adwords they need to think twice.

  2. AdWords have worked well for my brokerage but I notice the cost-per-click has steadily risen in the last few years. There may come a time when it’s not cost effective anymore but we’re not there yet.

  3. It’s interesting to note the velocity of the increase in mortgage search popularity and this somehow gives you a glimpse of the real estate market trend in Canada. Thanks for this great post!
    @ NS Broker, I get where you’re coming from. I’ve done some Adwords campaigns and the cost per click has become somewhat expensive, low competition keywords with high traffic are hard to find. I can just imagine how it’ll be in the coming years

  4. Google Advertising’s been very good for my friend’s broker business. Surprised more industry players haven’t taken advantage of it. Oh well, I guess Rob just blew the cover. I wonder how it performs versus social media? Anyone got stories?

  5. @Ron, that’s quite the generalization you’re making. First of all, yes, small brokers need to focus on more niche keywords/geographies in order to compete with big banks. But to your 2nd point (re: adwords/SEO not being profitable), how do you calculate “profit”? If you think about the profit from one additional mortgage sold by a broker that was generated from Google adwords, you’d have to be paying >$50 per click in order not to be profitable. The smarter brokers (and FI’s) have figured this out, and that’s why they’re spending more time on pay-for-performance media like adwords.
    Do the same math on buying a newspaper ad or a bus shelter ad, where you have to fork out a few thousand $’s UPFRONT, and then HOPE that maybe you sell several mortgages just to recoup that.

  6. Social Media is just another tool, but its not a blatant pitch…well, for some it is. Google Adwords are still effective, however Costs per Click (CPC) have raised due to the greater population “catching on”. Most treat this form of advertising like they’re a 19 year old dude: trying to close on the first date.
    The problem with most in their efforts to acquire leads through CPC marketing is that there is not a proper Call to Action (CTA), no proper Landing Page, and no value to make the prospect follow the steps needed. I have seen far too many CPC ads on Google or Facebook which have a rate as their CTA, yet when clicked on it lands to their home page, or even worse, their Facebook Fan page wall that shows no sign of the original offer.
    Another major error is trying to advertise to the entire country as opposed to focusing in on your City. The costs of a laser focused ad campaign can be dramatically reduced if a little effort is taken to minimize the total amount of eyeballs on it.
    Although SEO and Google ranking is very, very important when it comes to Ad campaigns, I would argue that ranking means nothing without good follow through and great content.
    Rob, awesome content in your blog as usual. :)
    Stay awesome.

  7. I have given up click-through ads for the most part myself, finding that genuine valuable content draws more readers and that many of those have a conversion rate higher than I’d get from AdWords anyway. I appreciate this post, simply because it’s amazing to see how important Google (and other search engines I’m sure) has become in our business. Thanks!

  8. Buck, setting aside the chance you may be an internet consultant, I guess adwords might be okay if you are hoping to generate a deal or two a month, but if you are committed to originating 60 to 80 funded deals a month from advertising its a different story.
    I have worked with all media for the last 16 years and spent over $3 million dollars on advertising in that time (which is small compared with some peers) and I think that has allowed me to draw some conclusions.
    Another mistake is thinking that commission = profit. If you run a real business you have to calculate fixed overheads like rent, payroll, etc into the mix so its not just click cost and commissions to sort out real profit.
    Banks run huge Google adwords spends but trust me on this one: banks do NOT know the numbers on adword clicks versus actual mortgages closed. Banks just have the deepest pockets in Canada.

  9. Getting internet searchers to your site is only the first of many steps you have to take if you want to successfully convert clicks into commissions.
    I am amazed at how much money brokers (and banks) spend to get people to sites that offer very little value.
    If your site doesn’t offer quality advice (and opinions!), handy tools, and original content that demonstrates why you are the clearly the best person to assist that reader with their mortgage, you might as well set your marketing money on fire (because then at least it will keep you warm for a few minutes.)
    Establishing credibility and building trust is where the rubber really meets the road.
    To be brutally honest, I think the competition among those who provide quality mortgage content on their sites is still very thin. For the few who have focused on content instead of clicks (CMT first among them), there is still plenty of business to go around.

  10. It would depend on what your goals are. With Google Advertising, you get instant traffic but without good and relevant content the traffic wouldn’t matter much. Getting immediate clicks is one thing, having them convert is another. With Social Media, although it may take a lot of time and effort (As with Adwords), you get to somewhat ” build relationships” and establish trust, credibility and communication. Id’ say both are effective in their own way.
    Adwords worked out for our realtor client, while Social Media brought in more leads for our business. I guess some factors you need to consider are what you’re advertising and what your goals are.

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