About 9 months ago, I created a post on BiggerPockets (for those who are interested, check out the post) around how I was choosing to stop this romance with offline marketing (i.e. direct mail, driving for dollars, door knocking, etc.) so as to venture into online markering. Since then, here is what I learned:
- Regardless if you choose offline or online (i.e. website, Facebook Ads, Google Ads, etc) marketing, you are going to need a good size budget ($) to fund your efforts.
- You can build a website for free, invest in a real estate investor customized site (LeadPropellor or OnCarrot), create a personal (professionally designed) site, or just pay for a lead generation site. It all does not matter unless you have a marketing plan that will guarantee that people will not only visit your site, but also convert.
- You are going to need to build a team and you are going to need to pay them (i.e. Bird Dogs, Acquistion Manager, Virtual Assistant, SEO consultant or Social Media Marketers, etc) in order to see progress over time, based on your marketing efforts.
My questions to the BiggerPockets community are...What keeps you going? What are you doing that allows your business, of real estate investing/marketing, to be successful in the way it is successful to you? How are you investing your money, back into the business, so that you are not running out of funds too quickly?
Also, for those who read my first post, here is the answer to your questions:
Did you get leads through your website?
Yes. Surprisingly, I also got a lot of leads from local investors (wholesalers & rehabbers) who wanted to network with me in some capacity.
Did your website get to the top of the search results?
Yes. After finishing my website design, I hired a SEO consultant! They were great! Based off the keyword phrase "sell my house fast boston", that they suggested I then took screen shot (see below), which was taken late last week. It took about 2-3 months for my site to be ranked #1 on page 1 of the organic search results, which are below the Google Ads.
The SEO Consultant also suggested "we buy houses boston" and we are now ranked #2 on page 1 of Google.
Please note, ranking changes from week-to-week, so our site may go up or down depending on a variety of factors.
Did you close any deals?
No. But before folks get down my throat about it, let me explain. It was not because it had anything to do with my website or my transition to online marketing, but moreso it had to do with a lot of things happening for me & my family, within a short amount of time, that took me away from the REI business:
- My wife was pregnant and had our 2nd child in July 2018.
- We moved out of our home, due to a decision we made about moving closer to my wifes job.
- We also spent time putting our house on the rental market; we are now we are buy & hold investors.
- Going through a personal weight loss transformation...so far lost about 27lbs in 9 weeks.
- Closed down my private counseling business so I can create more time to be with my family.
- Had to hold off on investing my funds into the online marketing portion in order to re-evaluate my wife and I's finances (i.e. student loans, credit cards, mortgage, etc).
Hey @Account Closed ,
Thanks for the feedback. If you read my first post, you would have seen that I did start FB ads. I even enrolled myself on an online course to study FB marketing. What I found was that videos yield more return on my marketing investment, as long as my video was recorded and marketed to the correct crowd.
In the future, I am hoping to hire a videographer/editor to assist me with the recording of a video. Posting a video, captured on my phone and posted on FB is not in the best interest for my business. That may work for the younger generation.
Your argument about websites being "old school" is relative to the generation that the business is going after. The majority of instagram users fall between 18 to 44, according to statistica (which is about 85% of instagram consumers). What we are looking to do with our business is focus on the digital marketing within the social media platforms that is most saturated with the type of consumer we need.
If you look at the average (median) age of a homeowner today, they are about 34 years old. The age of our customers, is at least 45 years old +. According to market research, the use of social media in 2018 is still being consumed on Facebook and Youtube.
Also, there is so much shifting happening for internet itself. Google just emailed us informing us that they changed their ranking factor to be officially mobile first (see below)...
I appreciate your feedback. Please share more about what you have done with your business as it will be helpful to learn from other modern businessmen.
@Omar Ruiz all these new strategies are interesting and sound fancy but until you close any deals, you can't compare the impact of each strategy.
Let's say, a year ago (13 months to be precise) I mailed 30 letters to absentee homeowners.
As for now, I've sold 2 houses from that mailing and one is still listed for sale. When I compare with my other strategies (mailing to different groups of potential clients), this one gave me the best return on investment of my time and money (whole $25-30 worth).
So, when I divide the commissions I made by $25 invested in that particular are and few hours of my own time to get precise list by my criteria of these 30 addressees, it's huge amount in %%, like $7K/$100=7,000%
When you divide $0 closed deals by your expenses on SEO, web site (time) etc - it's still zero.
When you're creating a new system, don't dispose that one which brings you money already. Because these few hours (2-3) was the only time to bring me clients.....in this particular case.
Unless people called you and you turned them down because you have to go to the gym.
All that fancy talk is cheap until you can show some money to support it....just saying
@Omar Ruiz I think we all tend to overthink, overcomplicate, and overspend on what is an incredibly simple thing. Instead of doing all of that stuff you listed, I just call FSBOs. They're already telling you they want to sell. It costs nothing to contact them and hardly takes any time.
Out of the last 30 FSBOs I've called I have 1 house under contract and 5 warm leads to follow up on. I don't even have a website or business instagram account, and don't get me started about that hot mess called facebook.
Not sure if you read the Part I of this post, if not, click here. I submitted this post as a response to someone who recently asked what are my updates since several months ago I said I would update the BP community around my efforts.
As far as the math you provided, it is great example for realtors because you make reference to selling the houses and making commissions. However, as you may be aware, REI wholesalers do not make commissions or sell houses, (unless they are also a licensed agent/broker), they assign contracts and collect assignment fees.
As far as your math, lets break it down even further from what you presented:
You talk about mailing 30 letters. Direct Mail services (such as YellowLetters) cost $.79 for a stamped envelope and a handwritten yellow letter. That would have costed you $23.70. With any marketing campaign you run, the major keys to success are:
- A/B testing - Testing out different types of mailers such as yellow letters, post cards, zip letters, greeting cards, etc.
- Tracking - Collecting data based on how many returned mail do you get back, how many phone calls/emails did you receive & if you combine a landing page [website] to the letter for people to visit, tracking how many people actually visited the site & possibly submitted a request for an offer.
- Follow up - How quickly can one return a customers call/email/online request.
- Consistency - How often are you mailing.
This can be applied to online marketing just as it does for Direct Mail. The issues I have had with the romance of Direct Mail are:
- Too easy - Getting a list and mailing to that list is something that anybody can do. It is not that hard. What's hard is closing the deal once you get some strong leads. Because of that, any & all markets are susceptible to being saturated with newbie & seasoned investors sending out mailers as a way to get into the REI.
- Quantity over Quality - You can create the most prettiest and heart warming mailer, but the game of Direct Mail (or marketing in general) is about quantity (i.e how many mailers can you send out and over what period of time before you get a response) rather than the quality.
- Response rate - For a true reflection on the response rate, we have to look at the percentage of people who responded to your mailers. For realtors (brokers), like yourself, there is an estimated 15-17%. response rate with Direct Mail. This means you should have gotten at least four (4) homeowners who contacted you back. Since you said two (2) houses have sold, that gives you a conversion rate of 50% from the amount of homeowners who initially responded. Good job! However, for everyone else, especially those who are not brokers, a 15-17% response rate is more than what can be expected. According to the Direct Mail Marketing association, the average response rate is about 4.4%. So, if we went by your 30 mailer example, 4% of that would be about 1 homeowner who responded. And if your conversion rate remains the same at 50%, then there is a 50% chance that that person may or may not sell with you. That is why Direct Mail is a game of quantity.
There is no doubt about that Direct Mail may work for people. For me, I refuse to do it anymore. This video best explains why.
What I am hoping for is get responses from investors (such as wholesalers) about what they have done in their market to make great strides in their REI business (not connected to Direct Mail).
Of course, if you are running a business, you are bound to pay for expenses, regardless if you get a deal or not (i.e. creating & mainitaining an active LLC, running a marketing campaign - be it offline [Direct Mail] or online, gas for your car when traveling to & from properties, etc). So, with that said, I am unsure where you get the $0 from, that you mentioned in your response? I mentioned nothing about my marketing contributions, all I said was I was pulling back from investing funds into my online marketing campaign, which is a choice I am okay with and have already made. Also not sure what me going to the gym has to do with anything. My business line/voicemail is set up. Even if folks did reach out to me, while working out, I can always call them back. And lastly, what "fancy talk" are you refering to? I am talking business and marketing strategy, is that fancy language for you?
I think it is about the market you are in. You are in Canada and I am in Massachusetts. You found a list that has worked for you and that is great! However, there are people on BP and newbie REI folks I met in person at REI meet up groups who struggle and live in markets for which they are not seeing the same response rate as you are. They need to develop creative marketing strategies that works best for them and their business. I lean onto digital marketing because I have told myself that I no longer want to continue direct mail and I am okay with that. Thanks for your feedback.
@Omar Ruiz Wait...so you just came on here to brag about your system that hasn't generated a single deal, and you're arguing with not 1, but 2 people who have closed deals with their simple nearly free methods?
I smell a badly disguised attempt to sell your online lead generation services.
I am sorry you feel that and are interpreting my previous responses in such a way. To be very clear, I am not here to argue, sell any online lead generation service, nor did I brag about anything.
I do have to ask you, what specifically did you read from my postings that has you convinced I am "bragging" or even "offerred" such services? OnCarrot and LeadPropeller, actual online lead generation service platforms, on the otherhand, are services that people can pay for in order to have their own templated REI website. I am not affliated, have purchased, nor am promoting such platforms.
What I have shared in previous post is I invested in building my own website for my own personal REI business. Please visit the site and you can see it is a site for homeowners to visit, not to sell for investors like OnCarrot.
I am open to hearing back from people as well as responding back with my ideas, opinions, and feedback. If you can, I would reccommend you please take time to read through my previous post (click here) so that you may be better informed about my history & intentions of using this post/forum platform.
@Omar Ruiz I'm doing all kinds of marketing and track each one.
I did pretty much everything but these fancy new things you're trying to advertise.
I'm pretty sure, in few years, Mail will be obsolete.
However, when you start your marketing, the first and foremost you specify your target audience.
I'm targeting a lot of group of people who can SELL their house - not these youngsters who want to buy a house. People who are able to sell a house, most likely, older generation, who don't go to Zillow unless they want a Zestimate. They call a realtor! Or someone who sent them a card, a letter or something with phone number.
Same with out of state owners: they have PM in the area and they don't want to check out local sites for referrals - they've got tons of mail to bother with extra search.
That's why you didn't close any deal with so many leads - you're targeting wrong audience!
These are young people who want to buy a house cheap not sell cheap.
The only one who might get caught in your net - so called "wholesalers" who don't own nothing but still want to sell something, they have no idea of condition, floor plan or selling points. They bought a list from some bank and honk they won a lottery....of course they will chit chat with you.
Let me know when you close on any deal with your system and I'll watch all that explanations then.
Now I do what works best for me and don't need to pay for anything.
As the owner of YellowLetters.com and calltext.com I can say both direct mail and digital is required to successful.
Direct mail gets the phone to ring by qualified prospects and digital follows up.
I took digital to the extreme by creating a CRM with phones, text, email, RVM, chat, webforms and conference.
To many people think marketing stops at the first call. It doesn’t.
We send out 29 emails, 7 RVMs, 7 Texts and a whole lot of live calls after every inbound. And we do most of it automatically.
As for websites and seo or ppc, Facebook and such. All of it still requires systems.
Leads are too expensive not to follow up.
I do agree, wholeheartedly, with you about needing to be specific with your target audience.
When I started REI, I did Direct Mail, prior to building my business website. I tried to target property tax liens. Instead of paying for such a list, I would simply email the tax assessors offices to get a copy of the tax title list (in which for most neighorhoods/towns in Massachusetts, the list is free because it is public information). From there, I collaborated with a partner, who is a licensed agent, and used the MLS to search each property. I would only mail to addresses that were not connected to an LLC (business). Sometimes, addresses had no actual property and I got returned mail because the address was actually land.
I learned a lot about targeting to this group of folks because I would drive by these properties and they also happen to be on my driving for dollars list. These houses were prime for rehabbers as most need a lot of work and the owners owed at least two (2) years worth of back property taxes. Depending on where they lived, that towns tax assesor may move forward with the title taking process and send the homeowners to land court.
If the cities, counties, and states wanted to really incorporate eco-friendliness & accept digital platforms as the main way of communicating, then yes, I also agree physical mail may become obsolete. This also assumes that everyone, regardless of social-econominal status would have access to technology in ways that would make paper itself obsolete. For instance, I no longer need to print a document in order for me to sign it. I can just Google "signing a PDF" and this is the site that pops up.
I would disagree with you around closing deals because I never said I did not close any deals, I said "No" to closing a deal based off of my website. I got leads through Craigslist ads, Direct Mail, Bandit Signs, etc. What I wanted to do was transition to online to see whether there was any difference in generating leads and getting deals.
As I said in my initial post, "You are going to need to build a team and you are going to need to pay them". This is in reference to me not having enough $ to budget a decent marketing campaign for online. The cheapest SEO consultant I found cost me $400/mth, which he did a great job with getting my site where it needed to be from an SEO perspective based off the keywords "sell my house fast boston" and "we buy houses boston".
However, with all the personal changes happening (that I also mentioned above), I could not keep up with this financially, let alone Direct Mail. And as I also mentioned before of the cost for Direct Mail and the need for consistency, even if I sent out 500 letters per month minimum, that would have costed me just about $395/mth. It normally would take "seven (7) touches" of mail before anyone would respond. That would mean, I was spenidng, at least, $2,765 in that time to get leads.
The reason for mailing that much per month is all connected to the response rate (4.4%). I would at least hope to expect 22 calls/emails (within that seven (7) month marketing campaign). From there 50% of them, at least if not more, wanted me to stop mailing or take them off my list, which left me with 11 people. From there, almost 80-90% of them did not agree with the offer amount as they felt the property was worth way more based on "online" estimates such as Zillow or Trulia, so I was left with 2-3 homeowners who would possibly consider my offer while also considering other offers because these were homeowners who also got letters from other investors (which I mentioned above regarding how because of the easiness of Direct Mail, the market of folks entering the REI business would saturate homeowners with mail). Because I did not have any website nor an online presence, the homeowners I have encountered would think twice about me because I did not present my company (ORuiz Investments) as legitimate.
These homeowners are not dumb, they are very much tech savy. They have access to smart phones and can easily search Facebook or Google me. So...hence whey I decided to focus on digital marketing. I am glad your system works for your brokerage, as I am sure you are also marketing for retail homeowners looking to get the highest and best of their property. As a working wholesaler, I am needing to target distressed homeowners.
Now, I see that you are someone who has your own marketing strategy that works for you and I am happy that your business is successful. What I am hoping to hear is from investors who have and continue to do such work online. That way I can learn from them as I am not giving up on my quest to get leads from online, just need more support from BP members about what strategies do they implement to keep their business running (even if it means to have direct mail or offline marketing as a back up).
Thank-you so much for your response! I have heard your interviews and appreciate the service you provide to the REI community at large. I do agree that regardless of which avenue I go to with my business, it needs a system. I am wanting to learn more from the BP community, especially those who decided to venture online, as to what system they use and if they outsource to agencies/people/organizations as part of their system. It doesn't hurt to ask others for ideas as a way to help continue building my business and more importantly my legacy.
@Omar Ruiz I'm not marketing retail properties, I'm looking for distressed properties - that's why I'm answering your topic.
Most of my clients are investors, only accidentally I list someone's house - or sell to. Generally, I'm looking at exactly what you're looking for: deals. De facto, I'm a wholesaler but with the license :))
That let me list a house on MLS when people don't want to sell with discount.
Ahhh....Now I understand. So, out of curiosity, what other marketing strategies have you implemented not including Direct Mail? And have those strategies given you as much or more leads from your Direct Mail campaign?
Open houses, Zillow potential buyers leads, Trulia seller leads.
#1 open houses but it's just for realtors.
#2 direct mail - some groups are better than others, but overall the best strategy
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