Direct Mail - is it still working?

147 Replies

@Duy Nguyen  I just put a 23 house package under contract that came to me via direct mail to high equity landlords. I have not had much luck with direct mail to owner occupant sellers, though. I'm sure this is very dependent on your competition in your market.

Originally posted by @Sharad M. :
Originally posted by @Mike M.:
Originally posted by @Sharad M.:
Originally posted by @Jerryll Noorden:
Originally posted by @Sharad M.:
Originally posted by @Duy Nguyen:

Hello all,

What kind of marketing strategy are you guys doing nowadays? Does DM still work in today’s competitive market? I sent out 3.9K letter this past month (I am committed for a 6 months campaign). It has been about 4 days since my mail hit, I got about 16 calls, most of them goes: “ f off”, “ don’t send me anything”, “ my house is not for sale”. No actual lead yet.

What are your thoughts? I am wondering if DM still works. Thanks in advanced

Hi Duy, Direct Mail still works but it's a long term marketing strategy and specially in a competitive market like Houston, TX you have to very careful with your list. Don't mail to list like Absentee High Equity and expect to get a deal on 1st mailing. Try more niche lists like preforeclosure, tax delinquent, water shut off, code enforcement, etc.

And IF you are going to do DM long term, then commit to 4-6 mailings to the same list. The magic of Direct Mail comes handy over long term. We get calls from people that we had mailed several months ago but they hold on to the letter or postcard and call back when they are ready to sell their house.

I would have other marketing going on also but if you have to pick a marketing strategy, pick the one you can stick with THE longest because THE MOST important thing with marketing is consistency.

 Also sending mailings to the same list is also a myth. It is an illusion it doesn't work! I am telling you it is an illusion.

It takes a long piece of text to explain exactly why this doesn't work and why it is an illusion, but I will if I have to.

Just because Direct Mail didn't work you doesn't mean it doesn't or won't work for anyone else. Here's the actual data. We closed 41 deals from Direct Mail.

I am part of several high level real estate masterminds and majority of the very top investors use Direct Mail for consistent deals. Again just because you didn't do so well in Direct Mail doesn't mean it doesn't work.

Please don't misguiding people that sending to the same list is a myth. Your incorrect statements and lack of experience about Direct Mail can hurt a lot of people in lost time and money. You are a freaking expert in SEO but that is not THE ONLY lead gen. To be honest, if I could get more traffic from my SEO I would love that because the ROI will be through the roof with SEO but you are leaving so much money on the table by not doing other marketing. We buy A LOT of houses from older people and they are not tech savvy and not going to Google to look for a home buyer.

People are reaching out to them via Cold Calling and Direct Mail. 

I have tried MANY marketing channels so I am speaking from experience.

The numbers below don't include revenue from 14 deals we have in the pipeline that will be closing soon and majority of those came from Direct Mail as well.

 
@Sharad M.: Nice numbers. Amid the noise and bluster I couldn't find how many mailers you sent to get 1880 leads. Do you mind mentioning that? And did you send envelopes or postcards?  I recognize that the list and the territory play a major role, but I am curious.

The numbers are over 1.5 years and now we are sending about 25,000 mailers every 2 months so on average 12,500 mailers a month and we expect to get 2 deals from that so on average about 6,000 mailers/deal at cost of $2,500-$3,000/deal. The numbers I posted are from last 18 months or so but with better tracking our ROI is getting better.

We alternate between PC and letters. Our cost for postcards is 36 cents and letters is 48 cents for a blended average cost of 42 cents/mail piece.

That's not a bad price for the mailers and is about the same as my experience. What investors don't seem to realize is that taking action is the main ingredient. Getting the mailers out consistently, even if it's a much smaller number to start with. I have bought houses from people who received a piece from me a year earlier. They show me the crumpled worn mailer I sent them when I ask them how they got my number. The other thing a lot of people starting out do wrong is to not pick up the phone when it rings. I get calls from 5:30am to 11:00pm and sometimes in the middle of the night. (People who work graveyard) Whenever people are in the mood, they call. I've bough a lot of houses where the call came in after hours. Someone has to pick up that call even if it's an answering service after hours.

 

Originally posted by @Jerryll Noorden :

 correct. Investor carrot is "just" a website. It is just a tool. YOU still need to make your site credible and do SEO so it ranks.

The reason I choose investor carrot is because they have what ever it is under the hood of the site right. They are fast, they customer support team is impeccable. There are some areas me and Trevor do not agree with but we both know that their site is second to none.

Do a search for we buy house sin [city] [state] and chances are it is an investor carrot site on the top 5 positions.

 So for a newbie like me who doesn't have $1k+ a month to put into marketing, what do you recommend? 

Originally posted by @Nicole Heasley :
Originally posted by @Ryan Dossey:

For anyone who's reading this who is interested in a few actual free ways to get deals... 

1) Make sure that everyone you know knows that you're looking for deals. I cannot count the # of times I've heard from someone in my circle that they forgot what we do. Or heard from a friend that they had the same thing happen. 

2) Set up saved searches on Craigslist with things like fixer, handyman, investor, tlc, diy, as-is, etc. This will cost you nothing and will have you chatting with motivated sellers in a day or two. 

3) Have a virtual assistant (or do it yourself) crawl all of the for rents on craigslist, FB marketplace, zillow, etc looking for the mom and pops. Send them a PM asking them if they'd consider selling instead. I bought an 80k duplex for 30k that pulls in $1,350 a month from this. 

4) Look in the newspaper classifieds. Oldschool retirees will post ads when they want to sell. 

5) Get a list of properties with code enforcement issues from your county and start friending people on Facebook.

6) Walk up to every garage sale you see and ask if they're selling. 

7) Network with the realtors in your area who are doing the most cash sales. Chances are they have pocket listings. 

If you're looking for consistent lead and deal flow it's not free. Neither are realtor commissions or wholesale fees. 

 Thanks for posting this! I don't expect free leads, but I also don't have $1k+ a month to spend on them either. This post really opened my eyes. I knew it would cost money, but I didn't think it was in the thousands per month. It doesn't look like Carrot/SEO or DMM are going to be an option for us. 

 There you go. 

Yes it is expensive.

BTW, SEO is free! Just do it yourself.

Originally posted by @Jacob Hammond :

@Jerryll Noorden what system is that you use?

 I use investor carrot for my website, and then I develop my own SEO strategies. You can do that too, it is easy once you understand it.

Originally posted by @Nicole Heasley :
Originally posted by @Jerryll Noorden:

 correct. Investor carrot is "just" a website. It is just a tool. YOU still need to make your site credible and do SEO so it ranks.

The reason I choose investor carrot is because they have what ever it is under the hood of the site right. They are fast, they customer support team is impeccable. There are some areas me and Trevor do not agree with but we both know that their site is second to none.

Do a search for we buy house sin [city] [state] and chances are it is an investor carrot site on the top 5 positions.

 So for a newbie like me who doesn't have $1k+ a month to put into marketing, what do you recommend? 

Get a website, $99/month

Make it credible. Learn about SEO and apply it.

Yes it will take time, absolutely, BUT it is extremely low cost and the most effective lead generation system on this planet as long as you do it right! 

@Nicole Heasley it really comes down to can you afford not to in my book. If you're flipping or buying rentals you will have a significantly higher equity position and/or larger profit if you're sourcing your own inventory.

I recently polled investors and the average reply I got was that they're paying $10,000+/- to wholesalers per deal.

If I didn't source my own deals I would have over $500,000 less equity in my assets easily/conservatively.

It definitely does cost money. Most investors are anywehre from 2-5k to get a deal.

The difference though is that is a house they bought at their #'s. Even if you're buying off the MLS imagine just getting to that owner directly first and being able to deposit the 5-7% commissions as equity to your side of the balance sheet.

BP in general is pretty anti-wholesaler but they're also the ones who have figured out how to find their own deals. If you REALLY want to be in real estate being able to source deals is paramount to your success. 

Marketing done consistently, creatively, and with adequate follow-up is EXTREMELY easy to make it pay for itself. You just have to be willing to go through some trial, error, and a few thousand dollars. 

Less than 8% of my entire portfolio was purchased off the MLS or from wholesalers. They are also some of my thinner deals. 

I'd rather "risk" some cash hunting for deals than wish I had them. Feel free to PM me and I can give you some of the run down on the personal financial side. 

My motto is to "Keep the best and wholesale (wholetale or flip) the rest". It's been extremely lucrative for us and is consistently a multi-six figure net income that also pays for all of our new buy/hold acquisitions. 

Appreciate ya! - Ryan 

@Austin Works The key man isn't just targeting equity owners.

You need to go more niche' than that. Seniors with two-story large homes who may want to downsize. Probates, Back Taxes, Code Enforcement, IRS Liens, Etc. 

You'd spend a fortune blanketing owner-occupants. You can get hyper-targeted and do well with them. 

We buy deals from owner-occupants all the time. I'm actually expecting a contract back on an A-class asset today from an owner occupant off of a "creative" list. 

Does direct mail work... This deal cost me under 3k to get. 

https://www.biggerpockets.com/forums/223/topics/771158-41-583-flip-profit-after-5-months?highlight_post=4532088&page=1#p4532088

Your goal as an investor is to build out your MFE.

Marketing Funnel Equation. If you put in X amount of dollars what comes out the other side

For me... I put in $2,000 and it spits out either a rental or a flip/whoetale that we will profit $17,000 on average on. 

This is predictable, repeatable, and worked consistently for us for 5+ years. A lot of investors are just so afraid of wasting $$$ that they never start. So they end up paying a fortune more than they need to for thin deals.

Originally posted by @Duy Nguyen :

RVM is Ringless Voice Mail. It does not ring, your message goes straight to the prospect's voicemail.

Ringless voicemail really does ring. They seem to send two calls at the same time, the first blocks the line so the 2nd goes to voicemail. The phone absolutely does ring for a moment and then you have a missed call from one number and a voicemail from a 2nd. Its annoying and makes me think everyone that uses it is too scared to talk to me directly.

@Account Closed RVM's are also definitely illegal. I have a few friends who were using them and who are now in litigation over it. Attorney Generals are involved in a few. 

@Duy Nguyen I have attempted to start this off a few times and keep getting stumped on how to best PC answer and be accurate, and can't, so I am just gonna embrace the @Jerryll Noorden method of brute blunt force truth. 

I call BS on most of what I have read here on DMM "working". See, I have done millions of pieces of DMM, tens of millions, as I started in DMM pre-internet (yup, I'm an old azz). So yeah, I know what I'm talking about. The first thing anyone experienced in DMM is going to tell you is 

(a) it's ALWAYS changing. Society changes, shows we watch change, what's funny, what isn't, what matters and what dosn't, and with that what people find engaging and trust changes, damn nearly daily it seems sometimes. So with that, what worked for last campaign dosn't really mean a whole hell of a lot for what's going to work on next campaign. So to be effective, a DMM campaign has to be constantly evaluating, adapting and evolving with societal changes. I have read anyone speaking on this point. 

(b) DMM is NOT an in-all end-all, it is just ONE part of the lead process (funnel). DMM leads require multiple touches, nurturing, filtering, yeah i know sometimes a lay-down will just magically land in the lap and close with 1 touch but anyone stating to there DMM operating like that on the regular I call BS, I call EPIC BS. Dmm is great for brand building where you want to be constant in a persons mind, and the point of brand building is to pave the road for other marketing operations. As a stand-alone lead generator, lol, not a chance.  

(c) List development is NOT list buying! I have all but never purchased lists, and remember how many DMM I have done. When you buy a list guess who else has that, EVERYONE, so congratulations you get to be 1 of 1,400 of the exact same annoying junk mail in someone's mailbox, and your open and action rate drops by a BIG multiplier. So yeah, it's work to build and develop a list, that's reality. So a real DMM program ALSO has a list development and nurturing program with a managed database, a key point I didn't ready anyone speak of, which add's to their "BS" rating in my book for stating how DMM "works". 

Sad part is I could go on with more points but those alone should help open your eyes a bit to the reality of what a REAL DMM program requires, as it IS a PROGRAM, not a 1-stop e-z-pee-zee path to leads and sales. 

Now, does it "work", the answer is yes and no, it all depends on what your expecting it to work for. If your looking to get brand recognition in a certain target market or with a demographic, then yes it will help to "work". If your definition of "work" is bringing in enough leads, itself alone, to make enough $ to buy something other than Ramen to live on, than I'd say no.... actually HELL no. 

Look, I have lived it, I was a marketing pro pre-internet for my companies, through the change, and post. Fact is the internet took over most of what we did on paper, including DMM. It's just not the same, things changed. DMM still has it's place and purpose, but not as a stand-alone lead gen resource. And I will go a step further to say PPC is a half step behind DMM in that manner (I read a few say they do that and I burst out in laughter until I read more to find they were serious). 

@Jerryll Noorden could have been a bit more chill on his presentation of things, but by fact and content, he was spot on in all regards as to where to best focus time and $. And when you're ready to be the "Coca-Cola" of properties in your market, then do DMM and billboards and all that high expense low conversion rate stuff. 

I hope this is found of use and value by all considering before having to learn via $ loss's. 

Originally posted by @James Hamling :

@Duy Nguyen I have attempted to start this off a few times and keep getting stumped on how to best PC answer and be accurate, and can't, so I am just gonna embrace the @Jerryll Noorden method of brute blunt force truth. 

I call BS on most of what I have read here on DMM "working". See, I have done millions of pieces of DMM, tens of millions, as I started in DMM pre-internet (yup, I'm an old azz). So yeah, I know what I'm talking about. The first thing anyone experienced in DMM is going to tell you is 

(a) it's ALWAYS changing. Society changes, shows we watch change, what's funny, what isn't, what matters and what dosn't, and with that what people find engaging and trust changes, damn nearly daily it seems sometimes. So with that, what worked for last campaign dosn't really mean a whole hell of a lot for what's going to work on next campaign. So to be effective, a DMM campaign has to be constantly evaluating, adapting and evolving with societal changes. I have read anyone speaking on this point. 

(b) DMM is NOT an in-all end-all, it is just ONE part of the lead process (funnel). DMM leads require multiple touches, nurturing, filtering, yeah i know sometimes a lay-down will just magically land in the lap and close with 1 touch but anyone stating to there DMM operating like that on the regular I call BS, I call EPIC BS. Dmm is great for brand building where you want to be constant in a persons mind, and the point of brand building is to pave the road for other marketing operations. As a stand-alone lead generator, lol, not a chance.  

(c) List development is NOT list buying! I have all but never purchased lists, and remember how many DMM I have done. When you buy a list guess who else has that, EVERYONE, so congratulations you get to be 1 of 1,400 of the exact same annoying junk mail in someone's mailbox, and your open and action rate drops by a BIG multiplier. So yeah, it's work to build and develop a list, that's reality. So a real DMM program ALSO has a list development and nurturing program with a managed database, a key point I didn't ready anyone speak of, which add's to their "BS" rating in my book for stating how DMM "works". 

Sad part is I could go on with more points but those alone should help open your eyes a bit to the reality of what a REAL DMM program requires, as it IS a PROGRAM, not a 1-stop e-z-pee-zee path to leads and sales. 

Now, does it "work", the answer is yes and no, it all depends on what your expecting it to work for. If your looking to get brand recognition in a certain target market or with a demographic, then yes it will help to "work". If your definition of "work" is bringing in enough leads, itself alone, to make enough $ to buy something other than Ramen to live on, than I'd say no.... actually HELL no. 

Look, I have lived it, I was a marketing pro pre-internet for my companies, through the change, and post. Fact is the internet took over most of what we did on paper, including DMM. It's just not the same, things changed. DMM still has it's place and purpose, but not as a stand-alone lead gen resource. And I will go a step further to say PPC is a half step behind DMM in that manner (I read a few say they do that and I burst out in laughter until I read more to find they were serious). 

@Jerryll Noorden could have been a bit more chill on his presentation of things, but by fact and content, he was spot on in all regards as to where to best focus time and $. And when you're ready to be the "Coca-Cola" of properties in your market, then do DMM and billboards and all that high expense low conversion rate stuff. 

I hope this is found of use and value by all considering before having to learn via $ loss's. 

Good points!

Originally posted by @Victor Vella :

Referrals. Referrals. Referrals. Save the marketing cost and time and step up on a deal

 The reason people do paid marketing, is to scale and have some sense of control on how many leads you get.

If 100 dollars gets you 10 leads, the idea here is that 1000 dollars gets you 100 leads.

See, most people do not understand efficiency.

If you have a team and you are paying a team and your team can handle an X number of leads a month, you better feed them X numbers of leads, otherwise you are not running your business on full capacity and efficiency and you are leaving money on the table.

So you DO want to have some sort of control when it comes to running your business.

Now you can either hire or fire based on the amount of leads you have (not very optimal in my humble opinion), OR you can  hire the necessary people that would help run your business smoothly and then do the controllable, scalable lead gen platforms to match the lead flow to your man power. 

And this model allows you to seriously run your business like a machine.

I too should be doing paid marketing. But I cann't. I can handle the sheer amount of leads we are getting right NOW. We just found a good fit for our acquisitions team and he is about to start in a few weeks. AFTER he is set in his position and he can handle these leads, OMG we are going on a hiring spree, as we have PLENTY of leads coming in. Exciting times because I know EXACTLY how many deals we can make a week with the right team. 

And THEN, although we are the masters at free lead generation, we WILL do PPC and EVEN DMM believe it or not. There still is a place for DMM, but no it is not a platform I would use for my MAIN lead generation! Absolutely not.

@Victor Vella I love referrals but they accounted for less than 10% of our deals last year. Plus you have zero control over how many people come your way. Ialso  love when agents bring me pocket listings but I can't scale that. 

I think the discussion here is a matter of passive vs active. 

Passive: Waiting and hoping someone sends you a deal. Active: Taking control of your business and dictating your deal flow by the amount of gas you can responsibly dump on the fire. 

Organize SEO leads are absolutely powerful and scaleable.

Referrals/Networking are still a great place to start. Maybe I’m just old fashioned 😆

They are a great place to start. They're something everyone should be doing. 

I don't disagree with you on SEO either. I have the #1 rank in 19 of the cities I'm in. Top 3 in most of the others. Then a few straglers in towns I wanted to see if I could rank in for fun... Like Hawaii. I've had over 1100 leads come through my carrot site. 

I have an issue with making blanket statements like something doesn't work or is a bad idea when every major player in the country is using it consistently to purchase deals. 

The original poster asked if it's still working. The answer is yes. It may not be your favorite flavor. But it is working. 

Comically we have actually seen an increase in response and conversion the past year or so as more folks have moved to cold calling, bandit signs, text blasting, PPC, etc. 

Last year we had 1,146 leads come in to my office. 60% came from direct mail. 40% came through my carrot site however according to Google Tag Manager/analytics more than half of those came from Direct Mail with our brand printed on it. Another 25% of the lead flow came from PPC, GDN, and Social Media. 

Moral of the story: If you want to do a deal a month or so you can pick one niche' and just run with it. If you want to do 50+ you're going to have to diversify responsibly. 

Originally posted by @Jerryll Noorden :
Originally posted by @Duy Nguyen:

Hi Jerryll Noorden, 

Thank you for your response. This is my first time doing DM and I got mixed response from other investors, some agrees with you and some said it still work. You brought up a few good points. Thanks for your input! 

Proof is in that pudding, nice job. I looked at Carrot, now might just do it more intensly. Thx

 Yes and that is why I say you need to think.

Does any of the people that say "yes" to DMM give you proof? Screenshots? Some friggin CONCRETE DATA that DMM is OK?

NO

NONE

ZERO

Not a STINKING person has data that supports it.

Here is MY data.

Every lead you see here is free, ans super motivated. I didn't life a finger. I don't spend a single dollar. I dont buy a stinking list I don't set up 15 phone numbers to see which mailer or which color ink performed better (are you serious?) Do you REALLY think that because the envelope was pink and not yellow you got a lead? If that is what you think (generic you, not YOU you), you really need to turn on that brain of yours. If you got a lead from a yellow postcard is because you luckily sent it to a MOTIVATED seller, not because your stinkin letter was yellow. Seriously people come on!!

I don't do skip tracing and I don't have to explain myself to anyone why or how I found them and I don't have to deal with "GET ME OFF YOUR GAADAMN LIST" from disgruntled mailer receivers.

So.. tell me again why why you would even CONSIDER DMM?

Didn't think so.

*drops mic*

 

Originally posted by @Duy Nguyen :

Hello all,

What kind of marketing strategy are you guys doing nowadays? Does DM still work in today’s competitive market? I sent out 3.9K letter this past month (I am committed for a 6 months campaign). It has been about 4 days since my mail hit, I got about 16 calls, most of them goes: “ f off”, “ don’t send me anything”, “ my house is not for sale”. No actual lead yet.

What are your thoughts? I am wondering if DM still works. Thanks in advanced


I get calls/emails/texts from people looking to buy. Those "sort of work" but I get so many I direct them to my website with my canned response on how to submit an offer (then I never hear back). I used to actually get letters when I'd visit my office in Houston. My team would save them for me. Now they toss them. Last quarter they said the threw away 78 of them (granted I bet some where people that sent one letter per property/LLC). But that's a lot of garbage.

I can't imagine they work. Part of me thinks they must work a little if people keep sending them.  But I think it's just a fresh batch of new BP users that try to buy some list and try their luck.  The people making money are the companies that sell the lists and mail out for a fee. 

Originally posted by @Duy Nguyen :

RVM is Ringless Voice Mail. It does not ring, your message goes straight to the prospect's voicemail.

 Funny about RVM.  I have my phone setup to auto send all unknown numbers to voicemail. Not just ones that come up "Unknown" but ones where the # isnt' a contact.  And my voicemail message says "Do not leave a voicemail. I don't check them. If you want a call back, TEXT me".  

I noticed that every few months, when I'm board and am clearing out my voicemails (there are dozens), literally EVERY ONE is robo spam.  I just delete them.