An Offer Hard To Refuse?
Consumers are being courted with yet another inducement to take on debt in the home loan war – as if the uncertain prospect of further rate rises later this year and an unnerving property market weren’t enough.
Virgin Money has recently undertaken an aggressive marketing blitz designed to lure potential buyers into either taking out a home loan for the first time or refinancing an existing loan.
The group is making a concerted effort to grab its share of the home loan market in Australia by distributing a direct mail kit to its existing consumer base along with attempts to raise awareness of its offer on the front pages of metropolitan daily newspapers – in the form of the increasingly popular (among advertisers anyway) post-it note ad.
So what is all the fuss about? And why is the Virgin offer so compelling?
Well actually, on face value, it doesn’t appear to be all that enticing.
By leveraging off its sister company, the budget airline Virgin Blue, the incentives on offer for people who take out a new home loan or refinance an existing one are two return flights to anywhere in Australia.
This surely begs the question: how does a domestic flight, or any free flight for that matter, and often valued up to as little as $200 for a return, stack up against a mortgage – arguably the single greatest investment purchase a person makes in their lifetime?
The offer is open for anybody taking out up to $100,000 in a loan.
A quote from Virgin Group’s global circumnavigating tycoon Richard Branson appears on the marketing material: “Anyone with a mortgage deserves a holiday”…
With an impending first repayment deadline not to mention removalist, furniture and renovation costs stacking up, the last thing arguably on the mind of a new mortgagee is the thought of taking a holiday.
Would a free domestic flight entice you or your clients to take out a new mortgage or refinance an existing one?
3 Comments on “An Offer Hard To Refuse?”
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OzBoy says:
I wonder how loyal those customers will be? The next bigger or better offer will see them all change to another lender.
J says:
At the end of the day the lure of a “free holiday” may just tip the scales in favour of a Virgin loan over the alternative lenders.
There really isn’t any more to it.
Smithy says:
The Virgin brand has done stuff all in Australia> poor marketing and an ordinary product as well as no sales force means its always going to struggle. Designed by MBA’s, tested on MBA’s but sold to real people..