My Direct Mail Campaign Results Have Been Atrocious

My Direct Mail Campaign Results Have Been Atrocious

Wholesaler · San Francisco, CA · Member since 2012 · 259 posts · 147 votes

Hey There BPers,

Myself and my business partner have been spending a significant amount of time on our direct mail campaign and so far, our results have been subpar to say the least. We have sent out a total of 395 letters and received a whopping 5 responses. 1 was a prank call. 2 were of the "please remove me from your list" variety. Our one success was getting an appointment with a seller, so in reality we have had 1 good response out of 395 total letters. I'm hoping to get some insights and ideas/critiques for increasing our response rate. The details of our campaigns are below.

We have slowly been gathering addresses so our list is split up, one campaign is 149 people and the other is 246 people. We have sent the different groups different pieces to try and test what will get the best response.

The first group received a standard yellow letter stuffed inside of a handwritten (in blue sharpie) 6x9" manilla envelope (link). I also used some muscle car stamps instead of the regular American flag ones to hopefully make it seem more "friendly". Our response rate was 4 of 149. Here is a picture of the finished letter:

The second group of 246 received a different mailer altogether. We used an A6 invitation-style envelope that was handwritten in black ink. Instead of a yellow letter, we sent our message on standard white copy paper. This letter was placed in the mail on 10/19 and we've only received one phone call and one FB like from our efforts. Here is the copy:

"

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Dev HornPro Member
Flipper/Rehabber · Arlington, TX · Member since 2013 · 1k+ posts · 2k+ votes
12y

Your list there is a good "core" list of houses for you guys to keep an eye on, but your list size is WAY to small to generate a meaningful flow of leads.

Buy a list of at least 1,000 ABSENTEE OWNERS and mail them postcards every month for AT LEAST 6 months.

See this reply in the discussion

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  • Investor · Oxnard, CA · Member since 2014 · 438 posts · 187 votes
    10y

    @Sharon Vornholt I've read a lot about 6 or 7 touch campaigns, but it sounds like you are recommending an indefinite amount of touches.  It goes without saying that as you acquire more and more lists, your number of mailers will grow quite large.  Besides the cost of such a campaign, how would you keep track of that many mailers and be able to tell when a house is sold to stop mailing to it? How frequently do you touch those homes that you have been mailing to for any number of years?

  • Bakersfield, CA · Member since 2016 · 543 posts · 281 votes
    10y

    @Cornelius Charles, a list is typically good for about a year. However, the first 5-7 months would be the better time frame. Re-evaluating your list before sending each touch would be recommended. Meaning, if you get return mail: skip trace. If you get a call to remove off your list: make note, or remove for next mailing (though we recommend to continue mailing to these folks).

    While we cannot create motivation through a mailer, we can be the name that comes to mind when the motivation arises. Sending a different mailing piece every 3-5 weeks for 5-7 months seems to work great, as I believe you have seen before.

  • Goshen, KY · Member since 2009 · 835 posts · 683 votes
    10y

    @Cornelius Charles- 

    Remember that time and circumstances change all things, so when it comes to absentee owners you need to commit to mailing to them until the house is sold.The seller that isn't motivated this month (or even this year) may have a "life event" that changes that like a divorce, a death or something else. Suddenly they are a motivated seller.

     I have bought houses after 2 or 3 years.  So for the house I bought after 3 years that was 36 stamps and 36 pieces of paper and 36 envelopes. You can do the math.  I made $12,000 off that house.  Remember 80-85% of your deals will come at or beyond the 5th mailing.  Often it's the last guy standing.  Get a new AO list every 6 months or so.

    Probates will generally be sold in 15 to 18 months in my area.  I mail to them until the property is sold.  New people die each month and they get added to the list, others come off.

    You have to create systems and use a calendar to chart when mailings are due.  You also need some type of database.  A lot of people use Podio today which is free.

    The average return on direct mail is about 2% these days so on 1000 mailers you could expect   about 20 motivated sellers to cal you.  On average is you need to talk to about 20 sellers to get a deal. So for each 1000 mailers you might expect to get a deal.  Now in some areas that number is closer to a 1% return on direct mail, so you would need to be doing about 2000 mail pieces a month to get 20 calls.  Every area is different. But even if you spend $1000 to make $10,000 that is still a great return. 

    So my question is, why would you stop?  The whole point is to build momentum.  Direct mail takes a while to get that momentum.

    You have to get someone to look each property up on the tax assessor's site to see if it's sold.  In a best case world you would do that quarterly.

    This process is simple, but no one ever said it was easy.  I mail every person every month until the house is sold.  

  • Investor · Sherman Oaks, CA · Member since 2008 · 6k+ posts · 3k+ votes
    10y

    @Sharon Vornholt

    I love your Louisville Gal Blog and your podcasts and your direct and useful advice to help people to be successful in REI

    The gurus make it sound like you could send one or two pieces out and make "a Tonna money"

    My buddy @Dev Horn has this awesome video about marketing to motivated sellers and understanding "the Rule of seven, and that depends on how hungry your market is.

    Where I live in Los Angeles, it's more like "the rule of 10 or 12"

     If Cash Buyers are not buying right now in your area, consider either Co wholesaling or move to a hot area.

     If you're one trick pony and all you're doing is Wholesaling ,  Think seriously about other tools to be make money with.

    I like making 3% on pretty houses with no equity or low equity

     The tools I use are sub2 with and without a note ,  installment loan contract ,  lease with option ,  lease purchase , joint venture with the seller on  a minor rehab,  tenants in common contract, and more

    The key is learning how to talk to Sellers that have pretty houses and low or no equity

     Another key is to have a wonderful contract attorney that you can bring a letter of intent to lease or purchase and have them create a document(s) that will suit your needs 

  • Goshen, KY · Member since 2009 · 835 posts · 683 votes
    10y
  • Beverly Hills, CA · Member since 2015 · 38 posts · 10 votes
    10y

    Hey @Sharon Vornholt,

    Thanks for sharing your insight. Can you explain how you qualify and scrub your lists? My list provider gives me CSV files, and I haven't been able to figure out how to cross reference the new lists against the prior. I also haven't figured out an easy way to check whether a property has sold. Manually entering each one-by-one into public records takes forever! I appreciate any guidance you can give. 

  • Real Estate Coach · New Zealand / USA · Member since 2014 · 296 posts · 82 votes
    10y

    @Adam Phebus - I'm very interested to hear @Sharon Vornholt 's (& other members) comments, on this, but I thought I'd chime in here too.

    Not sure about "scrubbing" your lists, but as far as cross referencing, I presume you're talking about checking for duplicates, unsubscribe requests between two lists (etc)?

    In that case, we're using a VA with this kind of experience (Phillipines) to do the work for us. At $4 per hour it's money well spent and providing you employ the right person, they can usually do the work in a quarter of the time it used to take me! Just need to provide crystal clear instructions (we use video's) for your VA to work with.

    As far as checking if a property has been sold: We use the local county appraisers site, though it can take a while for the site to update following a sale. Not sure if this is what you're looking for in your area, but looks similar to what we use:

    http://www.ca.gov/OnlineServices/OS_Consumers_propsearch.html

    If I'm on the right track with your question, let me know I'll continue to add to this, if I'm off track and have misunderstood, I'll crawl back into my shell!

  • Beverly Hills, CA · Member since 2015 · 38 posts · 10 votes
    10y

    Thanks, @Steve G.

    I was hoping their might be an easier way to cross reference/merge the CSV files, but I appreciate your tactic. 

    To check if a property has been sold, I've been checking our public records through my MLS - very similar to the link you sent, and how you check. Again, I was hoping there was an easier way bc it's so tedious checking 1,000s of properties 1 by 1. The list provider I use is supposed to exclude properties that have sold, but I've found a few have snuck through.

    Please do continue to add guidance! 

  • Real Estate Coach · New Zealand / USA · Member since 2014 · 296 posts · 82 votes
    10y

    @Adam Phebus - you know the old saying "if it was easy . .  everyone would be doing it"!

    If you're familiar with Excel, it's pretty easy to do, but still a little time consuming, thats why most of us use VA's. Our time is much more valuable than $4 per hour, and at first we're all a little reluctant to use someone else for something we're perfectly able to do ourselves (delegation). But our job is to identify the opportunities to make income, and sitting behind a computer working on excel sheets is probably not one of them!

    If you're absolutely adamant that you want to do this yourself (you might simply want to understand the process so that you can explain it to your VA when you find one), try checking out some of the YouTube tutorials. There's plenty of "excel" experts providing excellent advice as to how to sort lists. If you want to message me, I'll flip you something I started a while back which has a couple of fancy formula's, but I'll continue to suggest that finding a VA who you can use time after time, is by far the best use of your time!

    Doesn't matter which list provider you use (unless you're using your own MLS), you'll likely end up needing to check for duplicate entries, solds etc. I'm currently looking for a smart young person to build me an app which we can use to notify us whenever a property in our database is sold. I'm sure I could do it, but as I mentioned above, my time is more valuable than trying to re-learn code!

    Welcome to our world!

  • Investor · Oxnard, CA · Member since 2014 · 438 posts · 187 votes
    10y

    @Sharon Vornholt Thank you for the very thorough and well thought-out response.  We started using direct mail (absentee owner list)  in June of last year.  We mail our touches every 3 months and i was planning on stopping after 6 touches.  Based off of your thoughts, I am going to have to re-evaluate our methods.  I really appreciate you taking your time to help those with a lot less experience than you.  Thanks again.   

  • Investor · Oxnard, CA · Member since 2014 · 438 posts · 187 votes
    10y

    @Claire Trammell

    We have been doing most of what you suggested, except for the frequency.  This was just the first time that I've seen someone mention sending out mailers indefinitely.  

  • Goshen, KY · Member since 2009 · 835 posts · 683 votes
    10y

    @Adam Phebus- When you scrub a list that means to clean it up.  Checking whether a property has sold is as easy as going on the tax site.  In some areas that might be the appraiser's site.

    I also just wrote a post over on my blog that has some resources for using the NCOA database, skip tracers etc. so you should check that out.  

    And yes it does take forever. That's a job for a VA.

  • Goshen, KY · Member since 2009 · 835 posts · 683 votes
    10y

    @Cornelius Charles - If you aren't mailing every month you are wasting your money.  Investors like me that mail every month end up getting the deals in the months everyone else isn't mailing to them. 

    You are better off mailing to the amount of people you can afford to mail to monthly (and mailing to them every month), than mailing to a bigger list quarterly.  You will get much better results.

  • Goshen, KY · Member since 2009 · 835 posts · 683 votes
    10y

    For anyone following this thread, I just did a post over on my blog on "Using the NCOA Database" (National Change of Address). There are some companies that do this, and I also have some resources for finding people when you still can't find their address.

    Louisville Gals Real Estate Blog

  • Investor · Oxnard, CA · Member since 2014 · 438 posts · 187 votes
    10y

    @Sharon Vornholt The frequency of our mailings depend on the list. For our absentee owner list, we mail quarterly. For our "urgent" lists (NOD, bankruptcy, etc.), we mail monthly. For all lists, our current system is to stop mailing after 6 touches.

    Are there any resources on your website where you document how you set-up and execute your various direct mail campaigns?  I would be interested to see how you are doing it since that seems to be a different approach than I have typically read about.  It sounds like there might be some things we can improve on.

    Thanks again for all your help.

  • Goshen, KY · Member since 2009 · 835 posts · 683 votes
    10y

    @Cornelius Charles -  Those of us that do direct mail monthly, love folks who mail quarterly.  Even better we like folks that quit after a few mailings. We get your deals.

    I have been doing direct mail for more than 20 years and I can tell you this; you need to mail monthly until you buy the house, someone else buys the house or you take them off your list for some reason. 

    Take AO's for instance - who on earth would you quit mailing them so long as they are AO's?  Time and circumstances change all things.  The out of town owner who isn't motivated today will almost certainly become motivated at some point in time.

    I once bought a house after 3 years.  That's 36 stamps and 36 postcards or letters.  I made 12k on the house.  You can do the math.t

    You need good lists hen mail monthly until the house is no longer available.

    Probates will typically be sold in 15 to 18 months. NOD's will catch up on their payments or the house will be sold at the Commissioner's sale. As you can see, most will "age out" on their own. Absentee owners will get mailed to as long as they own the house.

    80-85% of your deals will come at or beyond the 5th mailing.  I have a lot of stuff on my blog on DM, marketing etc. 

    Good luck.

  • Investor · Winter Park, FL · Member since 2016 · 69 posts · 52 votes
    10y

    I finally finished this thread and felt like adding one additional piece of value to help improve the campaigns of the other experts out their I have learned from on this. I am just starting the lead gen process in real estate but manage about $500k/month in online adspend on Google, Bing, etc.

    I am not an expert on DM yet, but I have several customers whom we have implemented complimentary remarketing campaigns to supplement their additional touches on Motivated sellers that take action. You have to have at least a few hundred emails, phone numbers or website visitors, but if you do, you can setup remarketing campaigns on facebook and also on Google to carry your message forward online much less expensively than the post cards. Does that mean you shouldn't do the postcards? Absolutely not, keep mailing those suckers, but in the 30 days in between mailings you could be touching people that have interacted with you on a daily basis for Pennies. If you already have DM nailed, unless 90% of your buys are from 65+ then it's a great way to go. If they don't have a computer, you can pretty much ignore my existence or anything I post in for the next 3 or 4 months until I nail down some offline funnel chops. 

    I might as well ad a point about DM vs just doing online. We are experts and I am still focusing on setting up DM 1st. Why? Because we have done lead gen in other markets like title loans (read other motivated customers), and when someone is motivated enough to take their own action, go online and find a solution, they go big. They will go to goggle search "sell my house in **** fast" and fill out the form on the 1st 5 or 6 websites they see ads for. You will get that lead, but so will 6 other companies, many of which have excellent marketing systems setup to close that lead. Competition means your offered price may need to be higher. I am hoping that when someone calls of a DM piece there is a much higher chance of having the lead to yourself. Maybe other mailers know about the absentee, but they don't know he is motivated today unless he calls them too. I doubt most absentee's save  up all their we buy houses letters so you may have the only one around. When that same motivated person goes online everyone who gets that lead knows they are motivated. 

    Bottom line, I think the other DM's will agree with me. I would pay 8x the cost for an exclusive motivated lead vs. a motivated lead with 4 seasoned cash buyers aware he has been activated. The deal you will get will more than offset additional cost. Someone tell me if I am off here? That doesn't mean I won't be advertising online. I'd be an idiot not to. Thank you for all the great information. In particular your list filter settings, the right list was my main focus.

  • Real Estate Investor · North Miami Beach, FL · Member since 2016 · 32 posts · 14 votes
    10y

    As @Sharon Vornholt noted, long-term consistency is critical.  We have been doing probate since January 2015, and our hottest leads come in after 6-months.  We recently closed a $20,000 deal after 8-months, and a $40,000 4-property package 2-years into probate.  We spend about $500.00 per month on our probate mailings.

    But I share original posters concern about custom probate list becoming excessively long. I manage the volume by every 2 months doing the following: (1) check every property on the MLS, and if it's on MLS submit offer to agent if it is in distress, otherwise ignore; (2) look to see on the County Appraiser if the property was sold/transfer ownership, or has a new absentee address - and if it was sold, watch for the price: if it was for $100 or some other suspect amount, I treat this as if the owner is another family member dealing with the property and keep mailing. I haven't done this yet, but I am considering instituting skip tracing at the 16-month mark to reach the personal rep directly.

    Additionally, we don't mail to properties with the personal rep living in the property.  We did this for 12-months, and didn't get a single call back.

    We use white letter with business card.  In South Florida, very competitive, we consistently have been around a 1.25% response rate.

    Also remember, it can take 8-12 months to get the call. Take another 8-12 months to get the deal. You need long-term mailing, long-term lead follow-up. This type of marketing isn't like widgets. I wish it were, my ROI calculations would be much more accurate.

  • Real Estate Investor · Missouri City, TX · Member since 2014 · 16 posts · 1 vote
    10y

    @Dev Horn Great advice! Do you do any driving for dollars. Most of my deals come from driving for dollars.

  • Real Estate Investor · Missouri City, TX · Member since 2014 · 16 posts · 1 vote
    10y

    With direct mail you have to keep mailing them until you get a response from them. Also don't jump form list to list.

  • Wholesaler · Charleston, SC · Member since 2014 · 38 posts · 18 votes
    10y
    Originally posted by @Account Closed:

    @Brandon Foken Forgot to add, why not contact a local Title company and have them give you a Farm of Absentee Owners in your area? It's FREE - saves you money. :-)

     What?? i didn't know this was possible

  • Wholesaler · Charleston, SC · Member since 2014 · 38 posts · 18 votes
    10y
    Originally posted by @David Dey:

    @John Klaus

    Finding phone numbers is actually pretty easy now days.  In this age of Internet and public records and ease of access, It's very difficult to stay off the radar.

    Everybody leaves a digital footprint somewhere.

    Here are some basic tools I use to find people.

    Free first:

    Whitepages/anywho/zabasearch/

    Google is the most underrated tool to finding a person.  Starting with their name and hopefully city or at least state.  You can find out pieces of the puzzle that make it easier to locate the person.

    Ex: if they are a professional of some sort, i.e. Doctor, lawyer, now you have areas you can find them.  If they are a part of a forum, it pops up.  

    I once pulled up a person that was a on a site for classic cars that posted a request for parts along with his phone number.  (Bought the house and made a 20k flip profit)

    Public records are amazing:  if you locate the area where the seller lives, make sure you look them up in their counties property appraiser, and clerk of court/register of deeds. 

    Examples of places you can find them:

    If they pulled a permit on a house the notice of commencement may include their phone number.

    If they were in a lawsuit and represented themselves, most forms will include a phone number.

    If they were a landlord and did an eviction, the 3 day notice or complaint will usually have their phone number.

    There are quite a few areas the info will show up in public records.

    Social media is the hands down best way to locate people.  

    I have found more people through Facebook, Twitter, LinkedIn then I can tell you.

    My favorite example is where I located the owner of an abandoned home on Facebook.  I had tried every tool I had available to me prior including free and paid services.  Including high end skip trace tools.  I had found out she had a daughter but couldn't find her either.  Then I tried Facebook.  Her daughter popped right up showing that she worked at the local Applebee's as a bartender.  And on her page her most recent post was a request by her to her fb friends requesting a ride to work.  And in the response was.... Wait for it... Her mom apologized for not being able to pick her up as she was heading into work right then. (Thank you oversharers)  a quick click over to moms fb page revealed that she worked as a waitress at the crackerbarrel next door.  

    One of our bird dogs actually went over there and talked to her, set up an appt and we ended up buying the house for $600. 

    Cheap next:

    Ussearch is a cheap skip trace tool that costs about $49 for a 3 month unlimited use service.  There is a lot of junk in to sift through but many times you get lucky.  The best tool in there is their direct link to social media.

    More costly but worth it:

    We have access to a service called tracers that, for .50 per pull, gets us some of the most up to date info on anyone out there.

    We also employ a couple of private eyes that are somewhat entrepreneurial that will not only locate the owner but set up the appt for between 500-1000 per closed transaction.

    These are a few of the tools we use to locate our sellers... And our buyers.

    Hope this helps!!

    P.S.  I mentioned if the owner is a professional of some sort.  

    If they are, check your states Secretary of State corporation look up, manytimes in their filings you will find their phone numbers.

    P.S.S.  If they own or run a website, that turns out to be an easy search.  Whois.sc is like a whitepages for domain owners.  Unless they specifically use and pay for a private service, you will have their email and phone number right there.  (Try Zillow for example.  I used the tool to speak to someone at the company to learn how to get info on expired listings off Zillow)

    Again, hope this helps

     a bit scary but hustler at best

  • Arlington, VA · Member since 2016 · 8 posts · 1 vote
    10y
    I think I've found a way to increase response rates by 5 - 15x compared to postcard/letter response. Very cool tech at lower cost. Happy to share.
  • Investor · Oxnard, CA · Member since 2014 · 438 posts · 187 votes
    10y

    @William Reich

    What is this technique that you are referring to?

  • Tacoma, WA · Member since 2015 · 141 posts · 29 votes
    10y

    Or you could go grand and post your add up on a high billboard outside a massive development created in the 1960s. I saw one saying "We want to buy your ugly house" on a massive billboard. This billboard is not to far from Seattle.

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