I'm starting a direct mail campaign to pump up my leads for the last part of this year, but I've never done one before.
Any do's and don'ts for direct mail?
Do you purchase any lists? If so, where do get your lists?
Thanks in advance for the help/answers
Too many to list in one post for the dos and don'ts.
If you're in a highly competitive area, do not purchase a list. If you're flush with cash and want to get started quickly in a secondary market, then a list makes a lot of sense.
People provide generic answers when there are no specific details. Each market is different.
Since you haven't started a direct mail campaign, here are some protips that should help:
Yellow-letters are extremely effective for direct mail in terms of response rate. They are better than postcards. HOWEVER, there is a big advantage to postcards, they are cheaper.
Pro-tip: Use 1 batch of postcards with first class mail then and then switch to yellow letters. Why? The first class postcards will bounce and save you a lot of money from mailing a bad address from subsequent batches and you can skip-trace the bad addresses for very valuable leads. Also, switching to standard mail afterwards saves money.
Pro-tip #2: Your campaigns will typically yield a response rate of 0.5-2% (typical but depends on the quality of your campaign).
Pro-tip #3: Make sure your market size is big enough (at least 200 targets) and that you can sustain a campaign for at least 4+ mailings. First couple often get thrown away.
Pro-tip #4: How do you improve your response rate? Split tests and tracking your results. There are many things to try from code violations to unpaid taxes. In general, people with more equity (typically older home owners) are more likely to yield deals. But you need to test between all these different types and see what works best for you in your market (driving for dollars/absentee, probate, etc.)
This is a great way to get started to build your own list:
What @Ray Lai said sounds spot on. I'm currently reading 80/20 Sales & marketing by Perry Marshall & split testing to see exactly how to phrase your postcards 1st would be wise. Using Google Adwords as a cheap way to split test your phrasing may be a worth while investment before printing & mailing out a bunch of stuff that won't yield a good response. Mailing costs money make sure what you're paying for will result in real leads to follow up on.
Hi Steven! We get all our data from RealQuest. It's data direct from County assessors. Feel free to PM me if you have any questions. :)
My #1 takeaway from running a direct mail campaign is don't get trapped spending lots of time in negotiation and number crunching just to find out that they aren't really motivated. Find out as quick as possible on the call if they are motivated sellers!
Thanks everyone! These have all been valuable responses. I'm in Columbia, SC where the market is good, but its not highly competitive, Ray.
That's on my list of books to read before the new year.
Thanks for the suggestion! What has been your response rate on the lists you get from RealQuest? Have you used any other services outside of RealQuest?
Will do! I've got a partner that will take care of that side of things.
@Steven Hughes Keep me in mind if you find anything off market in 29205 or 29201. I've got a lot of property in those zip codes and am looking for more.
@Steven Hughes I hope you get too many responses to handle!! Think about me for properties around Columbia. Good Luck :)
@Steven Hughes, what's your target zip code?
@Will Gaston Will do! Are you looking for SFR or multifamily properties?
@Curtis Thomas I haven't nailed that down yet. I live in the 29223/29229 area, but I'm familiar with the 29201/03/04/05 areas too.
@Steven Hughes Both. Anything in those will work. SFH all the way up.
Here's how to get a free list! Ask a Realtor to give you a list of all the expired, unsold and off-market listings that did not sell within a space of time and send your letters to these people. This is a great list because all of the people on it have demonstrated their willingness to sell their houses and failed to do so without your help.
Why will the realtor help you for free? You are going to tell the realtor which prospects are willing to list their homes again but aren't prospects for you. That's right! You will get a particular level of responses from people who still want to sell their homes. Of these, only a percentage of them will want to offer you the kind of discount that makes it worthwhile for you to pursue. The remainder, if they still want to sell their property, might be open to talking to your realtor. You are going to recommend your partner and tell the seller that you will have your Realtor call them.
If you are really enterprising, you can offer to sell the leads back to the Realtor rather than give them to him! Why wouldn't he be willing to pay for a completely screened, qualified lead who is expecting his call? Your effort has value to the Realtor, get what you can out of it!
@Ray Lai That's an excellent tip about the postcards! I have run a direct mail business since January 2001. Most folks are so concerned with saving money, they never consider why the price is so much higher for other classes of mail. What Ray is referencing here are the often overlooked features of first-class mail.
First Class mail is processed by the USPS on a priority basis… it goes to the front of the USPS line. Locally, first class will typically be delivered in 1-2 days and nationally; all of it should be delivered by about 4 days.
If your party has moved, your mail will be forwarded at no charge for a period of 1 year. If it’s undeliverable, it will be returned to you at no charge with the reason for non-delivery.
Standard Mail, formerly known as bulk mail and 3rd class mail, is a back of the line product, USPS delivers when they have the time and it goes in the recycle bin if not delivered.