Starting the Snowball ~ Diary of a Direct Mail Campaign

Starting the Snowball ~ Diary of a Direct Mail Campaign

Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes

Hey gang,

  I've seen a lot of these posts where people aspire to document their progress on a campaign or flip or deal, and then all of a sudden they disappear off the site and leave you wondering what the hell happened. It is my goal to counter that tendency and document a somewhat small direct mail campaign for the next six months with updates as they seem warranted, whatever happens.

 After so many months of reading, studying, and flip flopping on where to start, I decided wholesaling would be my jumping off point just to build some capital in order to buy and hold and hopefully rehab properties. 

 And having listened to so many podcasts, read so many blogs, and having come to understand that almost all of the successful people (with a few exceptions) do their own marketing, this is where I decided to put my accumulated wealth of $3,500 (which took me about 4-5 months to save - I don't make a lot).

 So where's it going? Well, I have three lists, basically.

1.) 500 absentee owners 50% or more equity, last recording date six years or more, 1-4 family, in or out of state.

2.) 500 owner occupants, 50% or more equity, SFRs, last recording date six years or more, age 55+. (This is more or less the list @Michael Quarles is awesome, and got me to take the leap. Thanks BP. You guys are the best.

  Follow or comment if you like. Though there really aren't any direct questions, experienced marketing advice is always appreciated.

Best,

JTM

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Rental Property Investor · Dallas, TX · Member since 2016 · 30 posts · 23 votes
9y

Thanks for posting all the updates. This should probably be mandatory reading for anyone who wants to get started in wholesaling(myself), so they can get an accurate picture of what it *actually* takes to land a deal. 

See this reply in the discussion

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  • Investor · Milwaukee, WI · Member since 2014 · 811 posts · 420 votes
    10y
    Joshua Martin Good luck on the campaign Josh. I don't know anything about marketing other than what I've learned on BP so I won't offer any advice but it's obvious that you've done your homework and are putting your plan into action. That's very commendable. Good luck to you! Keep us posted. By the way, if you want to build up some capital by working on some rentals, let me know. I'm hiring :)
  • Sugar Land, TX · Member since 2016 · 69 posts · 79 votes
    10y
    Joshua Martin good luck with your campaign, I am at the tipping point too, need to figure out few things and finalize my letter and list. I subscribed to this tread see how you will do over next few months, good luck again!
  • Property Manager · Griffith, IN · Member since 2015 · 1k+ posts · 913 votes
    10y

    I mail similar lists and it's all about consistency. One month one list responds well and the next , it's a different list. It's all about catching them at the right time. You'll notice a lag. I had a great April-June because my marketing Feb-April was high and consistent. My July sucked because I slacked in marketing in May-June because I was "too busy" looking at so many houses. Hit marketing 2x what I normally do in August and will be consistent w that monthly. Expect to have a big fall. 

  • Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes
    10y

    Thanks for the input everyone, and, since I'm only a few days in and have gotten a few calls, it seemed appropriate to post my little update.

      Mailed 60 yellow letters two weeks ago, 2 calls. 3% response rate. One tire kicker and another motivated but without any equity to do a deal.

      Mailed 70 probate letters (first round) only a few days ago, and got my first call today. Unfortunately again, no equity, and the margin was just not there to even contemplate flipping (for the end buyer). Although, I'm just glad I got a response. It was a property in a really nice area, mortgage balance was just surprising.

      Just goes to show you: send em out and the calls come in. 

    I'll keep em coming.

    Best,

    JTM

  • Compton, CA · Member since 2016 · 36 posts · 7 votes
    10y

    Sounds like a great plan @Joshua Martin . I'm putting together a similar business model here in Southern Cal. I am also a big fan of @Michael Quarles approach. I am still researching the market, but will still do some cold calling and door knocking to get my feet wet. Good Luck! I'll be sure to follow!

  • Investor · Lake Zurich, IL · Member since 2012 · 53 posts · 12 votes
    10y

    @Joshua Martin Following.  Looking forward to your updates.  

  • Lender · Greater LA/Orange County area, CA · Member since 2012 · 3k+ posts · 3k+ votes
    10y

    A single postcard will probably be viewed as coming out of left field, especially to a probate executor or administrator.

    Since your objective is lead generation, you'd do well to step back and work on your overall marketing strategy. 

    I suggest you use the mail > call > knock technique and build campaign(s) around a sequence of contact points after segmenting your lists. 

    As for mailing probates, I've never observed a postcard to pull, favoring campaign of letters in sequence, each with a timely theme that the reader would say"that's me" and motivates them to contact you whereby you convert (sell) them on the phone to take the next action step in your sales funnel.

  • Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes
    10y

    Hey @Rick H.,

      I was waiting for you to chime in. And perhaps I wasn't clear (or perhaps you read too quickly), but I'm actually mailing the probate leads a series of white, professional letters that I'm doing myself (at this point) because I think it's a good mail piece and I couldn't find something I thought looked good enough online. And, based on reading several of your other posts, I'm also trying to incorporate the 'themes' to the mail pieces. The first was basically an introduction, condolences, identification, and what I offer (while not pushing hard), and for the second I'm thinking still a sort of 'as you get going with all of this' theme, or 'does everyone have the same goal?' type thing. I'm in the process of writing it. What themes do you use? (As one line summaries, if you would). 

     And, sent out 65 last week, one call so far, motivated seller, but no equity to make a deal happen, even some type of sub2 that I don't really get yet looks too slim.

      The postcards are being sent in sequence to absentee and equity leads. 500 of each. Still working on better copy for the pieces, as I wasn't really impressed with the first one that's going out, but again, it's an introduction. 

      And an update: I also bought bandit signs a few weeks ago (which I don't really like for several reasons and don't think I'll use again), but I got a highly motivated call from someone who saw it today, and we're meeting at her property Monday. Owns it free and clear, and needs some work but didn't sound too bad. Tired landlord. Google pics actually look pretty good. Only thing is property is in a rough area, like, the inner, inner city, and while I would never buy property there, I'm sure there are investors who do, so I'm hoping this pans out into a small check on a first deal.

     I'll keep updates coming. 

     And as always, thanks for the advice everyone.

    Best, 

    JTM

  • Real Estate Agent · Westboro, MA · Member since 2016 · 1k+ posts · 471 votes
    10y

    Hi @Joshua Martin

    I also just started a dm campaign. My list is of 500 in the area and in the first month/mailing I received a 7.5% response rate from a handwritten letter. It was very time consuming but i wanted to see the results from a hand written letter. Out of the calls no motivated sellers but I will be in touch with them in the future by following up. I learned from the calls as well as some were giving me advice which was a bonus for me. Do you have a set script you follow? How do you handle your calls (google voice etc). The first few calls were nerve-racking but each one gets easier. I have never tried bandit signs which you have which is awesome. 

    Good luck with your motivated seller, and let us know if you close on the deal! 

  • Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes
    10y

    Hey gang,

      And first, @Steve Bracero. Yes google voice seems to work fine for now, and no I don't have a script, but I do need to draft something so I don't forgot essential information (like the call I almost got off the other day without asking what the mortgage balance was). Not a verbatim script, but just bullet points so I can think on my feet. I tried using one for cold calling a few weeks back, but realized that when I did get on the phone with sellers it went straight out the window, immediately.

      As for the motivated seller, I think I'll have to follow up again. I realized one thing about wholesaling though: it's hard. Because even though she is willing to sell at a 'cash buyer's' price, I need an even deeper discount to make it a viable wholesale deal. I also need to work on negotiation skills, because I came out with a low number and said that was the best I could do. I'll follow up in a week or two and if she hasn't moved it yet maybe I can move a little and take a smaller assignment fee. I should really, for my first wholesale deal, I should be happy with any money I get and not demand a 5,000 spread.

      Anyhow, I'll only post qualified and good updates from here on in.

    Best,

    JTM

  • Investor · Chicago, IL · Member since 2016 · 30 posts · 8 votes
    10y
    Add me to your buyers list
  • Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
    10y

    Motivatuon without equity can equal a nice sub2 deal to keep for yourself if the house doesn't need a lot of work and they're not behind, Josh.  

    Keep educating yourself and your conversion rates will climb. May even get out of the healing for a deal rat race!

  • Real Estate Investor · Orlando, FL · Member since 2016 · 50 posts · 21 votes
    10y

    @Joshua Martin, way to go on our plan! At least you have one and you're taking action. I laughed at the comment about members posting the start of their deals and not the finish. I noticed the same. If you wanna see some case studies (front to back), you can check out my site. Keep us posted on the progress with your mailers. I'm curious to see how it goes. I agree with @Rick H. and @Adrien C.; the endeavor should be more of a multi-pronged campaign vs. an event if you're going to procure quality leads. 

  • Sugar Land, TX · Member since 2016 · 69 posts · 79 votes
    10y

    @Joshua Martin it seems you are getting pretty good start on this.  I have a question do  you answer all your calls or let them go to VM to screen the motivated sellers?

    Thanks.

  • Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes
    10y

    Thanks for weighing in guys.

    @John Chin It is sort of multi-pronged, it's just finding it's structure as we go. I'm planning to mail the 1,000 leads for six months, not sure how I'll space them yet, and the probate 5 separate times. But I'm just building the pieces as we go. Wrote my second probate letter last night, just needs some fine tuning.

    @Kami S. Getting something of a start. Just talking to sellers is good practice. I actually just got off the phone with a FSBO that I guess I called a few weeks ago. Wants too much money, but I'll follow up in a month or two. It's certainly in the right area.

    And no, I've just been picking them up as they come in. Or if I even see a number on my google voice I call back right away. But given the few calls I've got, only one left a message. She was certainly motivated, but I think I negotiated myself right out of that deal due to inexperience. We learn as we go. 

    The postcards should be getting mailed this week. I think on Thursday if the one week turn around time was right.

    I think for the future mailing I'm going to use click2mail though. I like that you can really design your own pieces rather than just changing text, and they mail next day, giving you a much better approximation of when your mail will arrive.

    Best,

    JTM

  • Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes
    10y

    @Steve Vaughan

      I've been thinking over this lead I came across the other day and wanted to know what someone with experience in these low equity deals would've done. 

    It is the lead I mentioned previously on this thread, but the numbers are here: PP (amount owed on mortgage) 215k, ARV 275-285. Now, I never went and looked at the house because I didn't think there was any meat on it anyways, but the details I gathered from the seller are that it needs some work, hasn't been updated in 30 years, one of the windows is broken, and the place is generally dated.

    Thinking that the end buyer in this area would be someone with the intention of flipping the property, I thought my margin had to be much higher. For example, ARV @ 280 x .65 - repairs - my fee = 137,000k. I assumed 40k on repairs (I know, without seeing it) assuming that it needs an updated kitchen and bath in an area with a high finish level. So that's what, a 20-25k kitchen?

      Anyways, I think it's gone now, but for future reference what might you have done with it? If sub2, assuming he went along with it, would've required $4,200 p/m rent to hit the BP 2% rule, and while that's a ball park and probably not attainable in an area like this, you'd still have to assume the mortgage payment would be about 1200 per month just principal and interest.

      Just looking for creative strategies going forward. 

    Thanks in advance.

    JTM

  • Rental Property Investor · Oakland, CA · Member since 2016 · 268 posts · 106 votes
    10y

    Great thread. Following. I cannot wait to hear what has worked out for you and what has not.

  • Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes
    10y

    Minor update: 1,000 postcards mailed today - yellow letters right on point with a one week turnaround time. Let the calls start coming.

    JTM

  • Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
    10y

    I couldn't do much with your example either, Joshua. Possibly buy sub2 and put in a tenant buyer who would do some reno as part of their option consideration? Then you're in a sandwich though and definitely have some payment and LL risk.

    $280k rentals don't work most places. Sub2 is nice if the house would make a good rental with little work. Not much can do with a high priced fixer you can't rent out.

  • Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes
    10y

    Thanks Steve, that was kind of my thought process.

  • Real Estate Agent · Westboro, MA · Member since 2016 · 1k+ posts · 471 votes
    10y

    Hi @Joshua Martin What is your current response rate for the postcards? 

  • Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes
    10y

    @Steve Bracero. Currently, 0%. Haha. But they mailed last Thursday I believe, so I'm hoping I get some call shortly.

  • Milwaukee, WI · Member since 2015 · 37 posts · 8 votes
    10y

    @Joshua Martin

    Really enjoying this thread, I'm planning on doing a similar campaign this spring. Maybe we could meet up and connect sometime 

  • Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes
    10y

    @Craig Carmichael Sounds good. Let's do that soon!

    @ The gang, my guess is that the postcards are landing more or less today, and I got a call this morning. Following up on it as we speak, comps, etc., but looks like a really hood property. Alright for wholesale, but you never know if they're flexible. Generally, I don't think "What's your offer?!" is a good indicator of motivation.

     Anyways, that makes the response rate .1%, and a $642 lead. But hey, they just went out. Slow and steady as we go.

  • Investor · Milwaukee, WI · Member since 2016 · 389 posts · 193 votes
    10y

    First week response rate from postcards, .3% (that's 3 calls for 1,000 postcards, now $214 leads). - Not bad actually. Good practice talking to a few sellers and running numbers, and we're only a week in. One may pan out, he's thinking if he likes the range I gave him, and I'll follow up in a week or so if he doesn't call me back.

    However, surprisingly, bandit signs. I guess they do work. I've gotten probably about 6-8 calls off these, and while some are obvious duds (one lady didn't even own the house!), I'm going to look at one tomorrow and do a scope of work, and plan to partner up with a local wholesaler to contract and sell the deal. 9 am tomorrow, let's hope this one pans out.

    Updates to come.

    JTM

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