Since its founding in 1994, FirstPlus Financial Group has had a lot of catching up to do. The Dallas-based home equity lender had a small loan portfolio, wasn't known beyond regional markets and suffered from little awareness of its hallmark 125 percent LTV loan product. What it did have were big ambitions and a highly successful marketing model-one perfected by The Money Store, the sector's most successful lender.

Not only did FirstPlus adopt The Money Store's model of using a nationally recognized sports figure as its spokesman, but it also recruited Mauro Appezzato, who orchestrated The Money Store's national campaign. The company's success is hard to dispute: Four years later, the once-obscure lender boasts an aided awareness that FirstPlus CEO Dan Phillips claims is in the 40s. Its loan originations have soared, to $4.1 billion. Investors have rewarded the company with a $1.5 billion market cap-a 1,200 percent rise from the company's initial public offering two years ago.

Building brand equity

But coming from nowhere to become one of the most recognized names in financial services was a costly metamorphosis. In 1997, the company spent a reported $45.8 million on advertising, compared to just $2.5 million a year earlier and a scant $130,000 in fiscal 1995. "To build a brand name very quickly, you need to use the mass media," Appezzato says. "And even though it was a semi-crowded field, some of our buying strategies were ones that I did utilize at The Money Store. It helped (us) in knowing how the other major advertiser was strategically doing its business."

The challenge was to sell the idea of a new-style loan that over- leveraged the consumer's home equity, while others limited how much could be borrowed. Vince Morella, vice president of New York-based Brand Institute, says that the difference in the product is an advantage. "You have to have a brand that is highly memorable," he says. "They're kind of unique in that they are willing to offer a loan of up to 125 percent of the home (value). Some people find that a plus."

FirstPlus was targeting typical 40-year-old suburbanites with average household incomes above $40,000 and above-average credit ratings. To reach them, the company hired Miami Dolphins quarterback Dan Marino. The 15-year veteran has particular appeal to the company's target market because they grew up with him and fondly remember him in the prime of his career. He dominates the company's TV spots, its Winston Cup race car program-of which he is part owner with FirstPlus-and celebrity golf tournaments.

But as FirstPlus led the explosive growth in the home equity sector, competitors soon followed in its wake. Today, Marino fights for air time against The Money Store pitchman Jim Palmer, ex-heavy weight boxing champion George Foreman and four-time Super Bowl champion Terry Bradshaw. "There have always been testimonials, but if too many of them start to use sports figures, before you know it, you've got a dozen of them out there and the brand starts to lose its recognition," says Morella. "People say it's just another superjock pitching a product. It will lose its charm after a while."

But FirstPlus is not relying solely upon television and race tracks to market its loan products. The company is also using radio, newspapers and magazines and is considering billboards, though none have been used to date. The company is also accelerating direct mail and telemarketing efforts. "We're putting out 750,000 pieces of mail a day right now, and we'll ramp that up to 1.5 to 2 million in the next 12 to 18 months," Phillips says.

At the same time, two of its telemarketing centers are receiving nearly 6,000 inbound calls per day. In addition, more than 40,000 outbound calls are made daily, of which an estimated 4 percent are turned into borrowers. Still, the national TV campaign fuels the company's primary marketing message. Like The Money Store, FirstPlus continues to target the sports market even though prices continue to rise. Appezzato says that FirstPlus sponsored the NFL Alumni dinner at the Super Bowl instead of buying air time during the main event. "We try to find unique strategies in terms of how we use these high-visibility venues and buy them very cost efficiently," says Appezzato.

But grabbing sponsorships and air time that surrounds big events-and doing so often-has its drawbacks. So frequent are FirstPlus' ads that it is difficult to accurately measure which message consumers are getting. "You could have a national spot running really close to a local spot, running next to a syndicated spot, running next to a cable spot," Appezzato says. "Sometimes it's more difficult to get specifically the exact spot that (the ad) hit. But we try to identify those as closely as possible so that we can make adjustments."

plotting the future

The company is also focused on further leveraging its brand, rapidly built over the last four years. Through its acquisition of Life Financial, FirstPlus will be able to offer money market accounts, government-insured deposits, credit cards and a variety of other lending products. It is even offering variations on its 125 percent LTV product. It is still too early to predict, sources say, how these new products will drive the evolution of the company's marketing efforts.

While FirstPlus duplicated the strategy of a rival for its early success, Appezzato says that new marketing venues will define its future. "Every test you do, you learn something," he points out. "If you don't test it, you'll never know. And if you do test it, hopefully you'll find out what it was that didn't work so that the next time you come around, you can be smarter at it."

-J. Wallace

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