What does your deal funnel look like?

Question

Hello BP fam, wanted to see who would share some insight on what it actually takes to be successful in the real estate business as far as lead generation goes.

Would you be willing to share a quick insight into what that looks like in your business? Whether you wholesale, flip, Brrrr, or are an agent, let us know what type of business you run.

What does your marketing strategy look like (ex. Direct Mail, Word of Mouth, Billboard, SEO, PPC Etc)?

How many leads are you generating per month in your funnel vs how many of those leads you are sending offers to.

Lastly of those offers how many are you closing?

Hopefully, this will give some investors a better idea of where their funnel needs to be in order for them to scale or get their first deal.

Thanks again BP Fam!

Tim Oppelt · Answer

I run PPC and SEO. Also run PPC for other investors. Average about 10-15 leads per deal. I personally strictly wholesale but we work with a mix of wholesalers and flippers. Cost per lead averages in the low 200s.

Jeff Stephens · Answer

Hey Caito!  I'll give you my take on this...with a slight reframe.

In my opinion, I'd reframe the question from "what does it take to be successful," to “what strategy will generate leads with the Negotiation Dynamic I want to have?”

What is a Negotiation Dynamic?  The Negotiation Dynamic is the context of the conversation you are about to have with the Seller.  The Negotiation Dynamic is like a stage, where the performance (your negotiation with the Seller) is about to play out.

And that stage is set by your lead generation strategy.  In other words, HOW you generate a lead has a huge impact on the Negotiation Dynamic you will walk into.

Let me give you 3 simple, relatable scenarios as an example:

#1: A Seller submits their information on your “we buy houses” website.

What’s the Negotiation Dynamic?  Because the Seller has self-identified themselves as someone who is “motivated,” and they have reached out to a cash home buyer, the dynamic is this:  “we both know I need to sell, and all that matters here is price. Give me an offer, I’ll get 8 others, and then I’ll pick the best one.” The stage is now set, based on your approach, and will lead to a certain dynamic in the negotiation.

#2:  You are driving for dollars, and see a rundown house, so you knock on the door.

What’s the Negotiation Dynamic?  The Seller realizes you see imperfection (and opportunity) in their house, so they feel singled out. They’re also forced to react to your unannounced arrival--you’re standing right in front of them, and now they have to respond, whether they are comfortable or not.  The stage is now set, based on your approach, and will lead to a certain dynamic in the negotiation...a completely different Negotiation Dynamic than the first example.

#3:  You sent a letter to the owner of a rental property in your town, simply introducing yourself and expressing interest in their property, and they call you back.

What’s the Negotiation Dynamic?  You have no idea if the Seller is actually motivated or not; the Seller doesn’t feel you targeted them because you think they are distressed, rather just that you like their property.  The conversation may move toward a sale, or it may fizzle and go nowhere.  The stage is now set, based on your approach, and will lead to a certain dynamic in the negotiation...a completely different Negotiation Dynamic than the first or second examples.

These are three entirely different scenarios, that will naturally lead to three entirely different potential deals.

An important point:  none of these strategies is “good” or “bad.” None of these Negotiation Dynamics is “better” than another.

The real question is, “what Negotiation Dynamic do you WANT to have?”

Which one fits your personal style best? Which one will allow you to shine? Which one fits your deal strategy best, and your business model?  Which fits your skills best?

Once you know, then you can work backwards from the type of Negotiation Dynamic you want to have, and develop a lead generation strategy that will give you more of those situations.

I hope this helps!

Jeff Stephens · Answer

I appreciate your response, again. I recognize that you are top-notch in your area of expertise. Even though we all use the term “real estate investing,” in my experience there are actually a thousand different things under that umbrella—different strategies, markets, goals, product types etc. I think that can cause confusion because it leads people to believe we are all talking about the same thing, when we really aren’t.

Consider that perhaps you and I are not debating the validity of different strategies for playing the same game, but rather that we may be playing entirely different games. My unique (weird?) game is buying a few high-quality rental properties each year, with seller financing, off-market using a very relationship-oriented approach, and having no competition from other buyers. I respect that is likely not the game you may be playing. But I do trust there are others who want to play a similar game as I play.

Jeff Stephens · Answer

Thank you for your enthusiastic response. Speaking for myself, with my own acquisition and investment strategy, what’s most important to me is the TYPE of leads I generate, not the quantity or motivation level. I know the type of conversations I want to have—and that’s unique to me. If someone emailed me a list of 10 leads generated via SEO, I wouldn’t even look at them—not because there’s anything inherently wrong with them, they’re just not the type of folks I want to talk to.

Jerryll Noorden · Answer

This is what a properly set up funnel, that has a great lead generation system to feed the funnel gets you:

We bought this green house now worth $320K, for 10 dollars.

While you are scouting the MLS, or Zillow, and doing a search  spending time and effort relentlessly trying to find a deal, and when you finally do find a house, you probably pay market value or close to it....

we do absolutely do nothing, no time, no effort, no money, and the leads poor into my inbox,

When dealing with true motivated sellers like I do, there is no need for funnels. A funnel is a series of webpages "funnelling" potential sellers from the first page, convincing them to fill in the form page after page as they go through the funnel.

The reason that is a bad method is because you are trying to "convince" people to fill in the form. If you need to do any convincing, or pushing they are not motivated and a waste of my time.

We rank #1 on Google for pretty much any keyword you can possibly imagine, and people that absolutely need/want to sell find my website, see how good looking I am and fill in the form.

Because they are motivated we can get them for a severe discount, and still make the seller happy.

Win for everyone.

Michael Plante · Answer

I don’t know what a lead funnel is

I flip I just go on Zillow and put in what I’m looking for

When it comes up I buy it

I am completely lost by the terms in the posts above.  They seem so complicated but if they work for you more lower to you

Jerryll Noorden · Answer

That may be so, but then be careful of what advise you give others to follow, because in all honesty, for 100% of the people - you, people what to make money from their leads regardless what the leads specific situation is. Again, this is not an attack on you, at all, nor your motives or what you are specifically loking for.

For the rest of us, we want easy to convert, motivated leads, both qualtity and quality. Yes you need both. If you focus on Quality only, you may get 3 leads a year and that is not nearly enough. If you go for quantity, you may not have enough profits (if any) after the deal is done.

So again, what ever your taste is great, but giving advise to 2M people when the advise only applies to you is not fair for people reading this.

Either way...  this is so foreign to me. My logic can't grasp this.

You REALLY don't care for your leads quality not quantity? You just care where they come from?

Even if they don't want to sell, not motivated at all... that can't be right... right?

Jerryll Noorden · Answer

Hmmmm... This is the EXACT opposite I have been preaching the BP forums for YEARS!!!

It is not about what you want. It is not YOUR choice.

If t takes X, Y, and Z to be successful, it takes X, Y, and Z to be successful regardless if you want to do X, Y and Z, and regardless if you CAN do X, Y, and Z. It is like saying "as long as you work hard, or are consistent you will make it". That is SUCH BULLcrap!

It has NOTHING to do with what you want or what you can do. What it takes to be successful is not opinion. It is fact.

You need to indeed figure out what it takes to be successful completely irrelevant of your skills or what you want to do, and then figure out HOW to get it, period. There are no shortcuts.

Plain and simple. It is my firm belief that the sooner you accept this fact, and come to terms with it, the sooner you have an actual chance of becoming successful.

If your born skill is to drive for dollars, and you are SICK behind a steering wheel, and you decide to do door knocking, you will FOR EVER be struggling, no matter how good you are at knocking on that door. Or no matter how good you are pocking that stick in the ground with one smooth jab, as you impale that bandit sign into the dirt in slo-mo.You need leads to be successful, whether you like it or not. Whether you are good at generating them or not. CAN you get a lead doing doorknocking? Sure. Is it reliable? NO, is it scalable? NO. You stop.. your leads stop. Realize that the key to success as a real estate investor is your ability to generate CONTINUOUS motivated seller leads.

That is not going to happen driving for dollars!

Look,

I wasn't born with SEO superpowers. I WORKED at it, and figured it out whether was was good at it or not. I Forced myself to become good at it because unlike most of you that will only do "what they are good at, or what you FEEL like doing", I realized that THIS IS WHAT IT TAKES to make my millions.

So let me ask you all something. How long have most of you been hustling with Direct mail marketing, cold calling driving for dollars. For every one of you that is successful, there are THOUSANDS of you that are not, although they are good at it.

So the REAL question you should be asking is...

"How bad do you want to be successful?". Bad enough to step up and do what you do not want to do to make it?

To answer your question Mr OP:

Here is what my lead gen looks like:

Cost /Deal $0

No mailers, No PPC, No D4D, 100% Hands-free, cost/lead (never look at this metric as it is a useless metric) still is 0

SEO of course.

We convert 1 every 3 walkthroughs into a deal if Jess goes tot he walkthrough alone. We convert a bit over 40% if we go as a couple.

The gentleman above me also said "An important point: none of these strategies is “good” or “bad.” None of these Negotiation Dynamics is “better” than another."

Again, don't agree... and I can prove that this is wrong.

What would you rather have?

1). A system that is 100% hands-off, 100% free, giving you daily leads for free, without lifting a finger AND that are crazy motivated... (SEO)

2). Or any other system that costs money, doesn't generate motivated leads, lots of work, unscalable unreliable, stressful, and questionable and unethical (D4$, Cold calling, DMM, RVM, Bandit signs)...

Honestly... which one would you pic? 1. or 2.?

Thought so. So yeah anyone that says there is not a single best one, truly and honestly doesn't know about the true power of SEO.

Either way, you all do what you like... but what I said is fact. Not opinion!

(and I have the numbers/leads to prove it too ;) ;) )

Caito Coloma · Answer

Thank you @Tim Oppelt good stuff, I'm currently trying to do some PPC ads myself and definitely was interested in knowing where that needs to be so my business could take off. Currently generating 1 lead via my website per month so definitely need to bump it up. I think my biggest problem is google ads showing in areas where I am not targeting. Don't understand that aspect.

@Jeff Stephens thanks so much for your insight. It makes complete sense how potential sellers will approach using different methods of contact. My main system of marketing is currently Direct mail with a mix of postcards and letters touching my seller list at least once a month. However, this method has not proven itself yet as all I continue to get are those "take me off your list" calls. Definitely leaning more into the PPC lead gen through the website. Thanks again!

What does your deal funnel look like?

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