California Direct Mail Concerns

[Kyle Marek]

Hey BP, looking to add direct mailing to absentee owners to my marketing funnels. From doing a lot of research on BP and Google, I've got some concerns that I would love some insight on! I live in the Easy Bay Area.

1. I've read on BP that direct mail has a way lower response rate in California, and that the only investors who are having success are paying 10k/month on direct mail?? I realize these are seasoned investors with a system dialed in, but what about the little guy like me starting out? No way I can pay anywhere near that a month right now.

2. In targeting absentee owners, what is a preferable # of leads to pull from ListSource at time? I am aware that each lead will need up to 6 follow up mailings! My county had 275 when I refined the criteria. Is this just nowhere near enough for a lower to upper middle class county in the Easy Bay?

3. I want to sent both postcards and letters. What is the benefit of using first class mail? I've read that on several forums it helps cut out the dead leads for follow ups.

4. Should I be handwriting addresses in bulk? I want it to be personalized. I'm curious how to keep it personalized and somewhat automated at the same time.

As usual, you guys are awesome! Appreciate any help I'm lucky enough to get.

Kyle

[Sean OToole]

Hi @Kyle Marek,

1. Yes, there are a lot of investors in CA, and unfortunately the heard mentality of following gurus means that most absentee/foreclosure/tax/etc owners get a bunch of mostly the same yellow letters. How anyone expects that to work is beyond me. So the problem is partly that is competitive, and partly because investors don't take the time to differentiate themselves.

2. Number of leads depends a lot on your approach. If you plan to send the same yellow letter as everyone else, you are going to need to send A LOT. If you door knock, cold call, send fedex letters (expensive, but definitely gets attention), then you may do deals with far fewer. It's less about the list, or the quantity, then it is the quality of the impression. I'm not saying it is just about the method, it is also the message. For example, if you get a fedex letter you will of course open it and read it, but it will be a complete waste of the senders time and money if what the letter says isn't also compelling. As for "requires 6 follow up mailings", focus less on that, and more on the underlying point - people naturally gain trust with recognition. So on that 6th mailer, they aren't thinking wow these guys are persistent - instead they typically don't remember the earlier mailings at all. What they do think, is I've heard of these guys, maybe I can trust them. Now extrapolate that and understand it is about impressions - not mailings. So if you can get in front of them via a mailing, a cold call, an online ad, and an email, you may be able to get to that point of familiarity faster and cheaper then mailing alone.

3. Two benefits to first class 1) faster delivery, 2) free forwarding and return, 3) a belief that it is more likely to be looked at by recipient. The first is obvious, faster is faster. The second allows you to get mail returned letting you know an address has changed or is undeliverable. Years ago, you could build a whole business around sending lots of mail, and only focusing on the undeliverables, as there was essentially no competition on those deals. Find the undeliverable, skip trace the owner, and you'd likely be the only one working with them. These days you can use mail services to determine change of address (NCOA), deliverability (DPV) and even vacancy. So not as strong a reason to pay extra to have mail sent back (though it will pickup real time changes the services may miss). Finally, the impression - a hand written letter with a stamp, is probably more likely to get opened than a machine letter with bulk rate imprint. I think that is valid for letters. For postcards, I truly don't think it matters - they will see your message, even if only for a few seconds on the way to the round file. Can't say the same for most other forms of marketing.

4. I personally don't think it matters as much as many vendors make it out to. If your cheap crappy postcard has a headline that grabs their attention, and a message that intrigues them enough to call, it will FAR outperform the most elegant hand written letter that says nothing compelling at all. The questions you should be asking yourself are: 1) will they see read/my message, 2) will it inspire them to take action? If your message / offer can't be delivered without a long explanation, you may need a handwritten letter to get them to open it and read.

A few other suggestions:

1. Don't start with direct mail. If you are local to your list start ideally start by knocking on doors until you've talked to at least 5 people. It is very unlikely you will write a compelling message without getting to know the folks you are targeting. Don't go in trying to close the deal, go in trying to learn. Ask a ton of questions. Ask about the competition (do they get mailers, calls, people knocking on their door, etc). Get copies of your competitors mailers. Ask them if and why they would sell. You get the idea. And don't expect them to do it for free. Offering someone $100 cash for 30 minutes of their time works almost every time.

2. Remember the point of your mailing is to get them to call. Don't lay out your whole offer in your mail piece, instead give them a compelling reason to drop everything they are doing to call you right now. That is the goal of your mailing piece. Not to tell them you buy houses, you buy ugly houses, you pay cash, you, you, you. Clickbait works in directmail too.

2. Think about the big picture. It is not just the list, or just the marketing channel (direct mail, phone, online), or just the message, or just the offer. It is the combination that will determine whether or not you our successful.

Hope that helps.