New TV ads from American Advisors Group are set to air in coming weeks, featuring actor Tom Selleck as the new face of the fast-growing reverse mortgage lender in Orange that posted just under $250 million in revenue last year.
Siltanen & Partners Advertising in El Segundo—which hired on in June as the lender’s first ad agency of record—created the marketing campaign. The Cross Agency in Jacksonville, Fla., continues to handle American Advisors’ more than $60 million annual media buying budget.
“Our intention is to spend some more in the back half of the year,” said Chief Executive Reza Jahangiri. “A lot of it depends on the launch of the campaign, and if there is strong traction and good performance, of course we’ll up the budget.”
Jahangiri launched the company in 2005, offering reverse mortgages direct to consumers. He complemented the business in 2012 with a wholesale division that buys reverse mortgage loans from other originators, brokers and lenders.
“We are a high-growth company,” he said. “[Since] 2010 … we went from 40 employees to over 1,000.”
Some 750 people work in Orange, while the rest are at offices in Kennesaw, Ga., and Melville, N.Y.
Friedman Fleischer & Lowe LLC, a private-equity firm in San Francisco, invested in the company in 2012 to “provide growth capital and liquidity to founders.” Jahangiri and other members of management have “retained a material amount of ownership.”
Selleck
Selleck, also starring as NYPD Commissioner Frank Reagan on the CBS series “Blue Bloods,” steps in as spokesperson for Fred Thompson, who died in November after a recurring battle with lymphoma.
American Advisors substituted the ads featuring the former U.S. senator shortly after with commercials that spotlighted late President Ronald Reagan, who signed the reverse mortgage bill into law in 1988, as well as various academics and lesser-known actors presenting reverse mortgages as a tool that enables those 62 and older to borrow against their home equity to help fund retirement.
“It’s just like a regular mortgage—the only difference is you don’t make payments on principal and interest,” Jahangiri said. “The loan becomes due with principal and interest … upon … death or if a borrower sells the home.”
The message to come from Selleck will be similar, Jahangiri said, adding that the new campaign slogan is “Bringing stability to your retirement.”
It will play out in several commercials broadcast nationally and on cable, which may include the Lifetime Movie Network, AMC, Independent Film and National Geographic channels. The campaign also includes print and digital components, including banner and pay-per-click ads, and editorial-like content in daily newspapers.
The Emmy and Golden Globe award-winning actor, by backing the brand, also will attempt to dispel rumors about reverse mortgage loans, Jahangiri said, including misconceptions including, “You don’t own your home, or that the bank owns your home, which is incorrect.”
“He’s been trusted in people’s homes for 50 years, has had a phenomenal career, his values are very similar to ours, and he’s helped a lot of others in terms of social issues and other causes,” Jahangiri said. “We think he’s a great representation of us to get people to look more into reverse mortgage and see if it’s a right product for them.”
The audience the company is aiming for is generally homeowners over 62, but it also wants to influence “their kids, heirs and caretakers.”
American Advisors’ chief creative officer, Teague McGrath, “really understands the demographics” the company is trying to reach, Jahangiri said, adding, “We also surveyed seniors and gave them scenarios of different public figures and celebrities. Tom Selleck scored really well … and he’s never really endorsed anything else, either.”
Agency
The company considered several ad agencies for the agency of record designation, but Siltanen & Partners’ ability to vertically integrate tipped the scales in its favor.
“We are very focused on TV [advertising], and they have their own production house,” Jahangiri said.
The agency, whose clients also include Amazon.com, Coldwell Banker, Sketchers and YMCA, impressed him with its creative work portfolio.
“They are very passionate, and they understood the issue of home equity and retirement planning is under-represented from a penetration standpoint and awareness standpoint,” he said.
“The largest asset for the senior category is home equity—it’s about 51% of seniors’ asset base, and 70% of the time is a senior’s largest asset. There is $5.7 trillion in home equity for seniors, who are living longer than ever.”
Competition
American Advisors isn’t the only OC-based company looking to a celebrity endorser to help it grow a portfolio of reverse-mortgage loans.
Startup Ameriverse Mortgage in Seal Beach recently hired musician Bill Medley as its spokesperson. Medley is a Santa Ana High School graduate best known for hits he recorded as a member of the Righteous Brothers, a roster that includes “You’ve Lost that Lovin’ Feelin’” and Grammy-winning song “The Time of My Life,” which was featured in the movie “Dirty Dancing.”
