How to effectively use direct mail marketing

[Jeet Sangha]

It’s been a little while since I have consistently used direct mail marketing in my business. So, I wanted to put a couple of questions out there. First, what type or response rate are you seeing? Second, what criteria is most effective to filter the list for motivated sellers these days? Third, what is a good source to pull the list? 
lastly, are yellow letters or postcards still effective?

[Charlie MacPherson]

We use DMM in a few ways. 

1. Postcards mailed blindly to business owners with a few bullet points on how we sell businesses.  These are in a #6 envelope.
2. The same postcards mailed to targeted business owners, but with a handwritten sticky note with something like "we have buyers for motels just like yours!"  Also in a #6 envelope.
3. Mail merge letters in a #10 envelope, targeted to individual business owners with slightly more messaging.
#1, 2 and 3 all have first class stamps and are hand-addressed.
4. A bulk mail house sends letters with bulk mail permits to specific lists and bulk mail indicia postage.  These are machine addressed.

It's hard to measure response rates precisely, but my sense is that we're looking at 0.05% for #1 and #2.  Maybe 0.10% for #3.  #4 comes out of the mailing house, so I don't know their raw numbers, but I strongly suspect it's far less than the others.

By response, I mean that the recipient calls or emails us.

The zinger is that some postcards end up in a drawer and generate a contact many months later.  I don't see that with the letters.

For us, just one that generates a closed deal can mean commissions ranging from a few tens of thousands of dollars to several hundred thousand dollars, so for us, the juice is definitely worth the squeeze.  That's a number you'll have to work out for yourself.