Unfortunately, too many new investors believe that the success of a direct mail campaign is based solely on its initiation. In other words, just conducting a direct mail campaign is not enough to guarantee success. What they don‚Äôt realize is that executing a successful direct mailing piece is much more time consuming and difficult than they could have imagined. This is not to say that they can‚Äôt work, but it takes much more than just stuffing a letter in an envelope and waiting for the phone to ring. To get the most out of your mailing, there are many different steps that must be followed:
- Find the right list. Not all lists are the same. Before you mail your heart out, you need to make sure you are mailing to the right homeowners. Start by defining what you want out of your mailing and go from there. If you are looking for distressed homeowners, you need to do your homework and find the most up to date and accurate list available. The bottom line is always important, but you should be weary of lists that are considerably less expensive than others. Often times, it makes sense to spend a little more on a better list that can produce results. Research the lead source and read the referrals and terms of agreement. Most companies offer a short term trial period or some sort of opt out agreement. Spending money on a list that doesn‚Äôt yield results is essentially throwing money out of the window.
- Presentation. Whenever you do any marketing, especially direct mailing, you should put yourself in the recipients shoes. Before mailing, you should ask yourself what would make them open the envelope and read your letter. If the homeowner is distressed and late on their mortgage, they may be getting inundated with multiple calls, letters and postcards. You need your letter to stand out from the crowd. To do this, you need to be creative with your envelope and the wording of your letter. Some investors will send use bright pink or green envelopes, while other will opt to hand write the names and addresses. If the letter is not read, you have no chance of getting a call back. Once the envelope is opened, you need to have a letter that can easily portray what your intent is, how you can help them and how to reach you. Most recipients will open quickly and give your letter a short glance. Bullet points and well placed bold sentences work better than a standard letter form. Your goal is to get them curious and interested enough to call immediately after opening.
- Conversion. A good conversion rate is anywhere from 1-3% of the total letters mailed. There will be plenty of letters that will fall on deaf ears, but that is to be expected. The natural instinct is try to turn every phone call you get immediately into a deal. Sellers may sense your desperation and opt to work with someone else. With every call you receive, you should have a short script, or even a list of basic questions you want answered in the initial phone call. The key is to find the seller‚Äôs motivation and see what they want out of the deal. It is very rare to get a deal to contract after the first phone call or first meeting. You need to exhibit some patience with your direct mail leads and work them like you would work any other new lead. Some leads need to work with a sense of urgency, while others need some time to digest everything. Every call that you get must be placed into a database and followed up with as quickly as possible. Getting your phone to ring is not the goal, converting those calls to deals is.
- Repeating the process. If you are only going to send one round of 100 letters and expect your pipeline to fill up, you may be disappointed with the results. Direct mailing is a numbers game. Before you start, you need to commit to sending your same list multiple times. Most homeowners won‚Äôt respond to your letter until at least the fourth time you reach out to them. This means having the budget and patience to see the process through, regardless of any previous results. It is always better to send the same list multiple times than to keep switching from list to list and hoping for better results. Take your time to find the target market that you like and dive in head first. You can tweak the letter, envelope or presentation, but you can‚Äôt give up if you are not getting the initial results you desire. To give yourself the best chance for success, you should plan on mailing your letter at least four times.
There are many investors who have had great success with direct mailing. On the flip side, there are those that consider it a waste of time and money. In most cases, those investors have done things wrong along the way. Direct mailing shouldn‚Äôt be your only marketing piece, but rather one in a series of ways you plan to grow your business. Before you put that first stamp on, you should make sure you have the best list and are willing to commit ‚Äì regardless of the early returns. If you do this, you will find more success than you realized.