I can’t stress it enough: implementing a direct mail marketing campaign is one of the best decisions a real estate investor can make on their own. And while many are quick to presume the days of direct mail are as antiquated as they are irrelevant, I couldn’t disagree more. For what it’s worth, direct mail has resulted in some of my greatest real estate deals, and there is no reason to believe it can’t do the same for you.
There is something about a properly executed direct mail marketing campaign that can’t be reproduced by any other medium; it elicits a sense of personalization that can’t be easily replicated. At the same time, it offers advantages that can’t be found everywhere else:
If you like what you see, perhaps it’s time to start a direct mail marketing campaign of your own. Let’s take a look at the five steps required to get the ball rolling.
Step 1: Determine Your Budget
Prior to engaging in any sort of marketing campaign, direct mail or otherwise, you must formulate a plan from which the rest of your efforts will be founded. Even the best marketing ideas will fall on deaf ears without proper direction. It’s worth noting, however, that no plan is complete without a corresponding budget. As a real estate investor, few things are more important to your marketing success than determining an appropriate budget.
Ask yourself what a reproducible and realistic budget will look like for where you are currently at. Perhaps even more importantly, what can you afford to spend on a direct mail campaign every single week? The number you come up with will dictate the direction you head and the extent of your upcoming campaign. Be careful not to stretch yourself too thin or commit too large of a budget at first. I recommend starting off with what you feel comfortable doing, and perhaps expanding later if the results justify doing so.
Before you set your budget, I want to encourage you to mind due diligence. Don’t simply assume you already know the response rate or return on investment a direct mail campaign could result in; get some boots on the ground and crunch some numbers yourself. Talk to local investors that have implemented a similar campaign nearby and get a feel for what to expect. It helps to know everything from how much homes are selling for to the type of seller you are targeting. And while every neighborhood is going to be different, it’s better to collect data than to assume.
The idea is to determine, to the best of your ability, whether or not implementing a direct mail marketing campaign will produce a return on investment worth pursuing. And while it may be hard to justify the upfront costs of a direct mail marketing campaign, remember one thing: you are building a business that could greatly benefit from a single deal; all it takes is one hot lead to make every marketing dollar worth the investment. So before you rush into launching a direct mail marketing campaign of your own, first be sure to vet any possible outcomes. If you can comfortably say it will be worth it, feel free to move on to the next step.
Step 2: Identify Your Target Audience & Obtain Lists
Only once you have determined an appropriate budget can I recommend moving forward with a direct mail marketing campaign. Provided you have nailed down your budget, however, the next step is to identify your target audience. At this time, you must make it clear as day who you intend to market to. In doing so, it will be a lot easier to source the list to which you will mail.
Instead of simply mailing to an entire neighborhood, give yourself the best odds by targeting a specific niche. And whether you realize it or not, there are a myriad of different homeowners to target, each of which need to be addressed in their own unique way. Below you will find a list of the types of homeowners investors have had success mailing to:
It’s entirely possible to acquire lists (for a small fee) consisting of highly targeted homeowners. That said, it’s in your best interest to obtain said list and narrow your focus. Keep in mind that your message should be tailor made to the niche you intend to cater to. Remember, your prospects need to feel as if you understand their personal situation; the more personal you can make the letter, the better. And you can’t personalize your direct mail campaign until you know who you are mailing to.
To identify the list that works best for your situation, you need to refer back to your plan. What you intend to accomplish will help you decide which type of homeowner to target. For instance, if your goal is to establish a short sale business, you will probably find more luck mailing to those homeowners in pre-foreclosure.
Whatever you hope to accomplish, don’t move forward with a direct mail marketing campaign until you know who you are mailing to. Only then will you place the odds in your favor. Otherwise, you may find yourself throwing valuable marketing dollars down the drain.
Step 3: Set Up A Drip Marketing Campaign
With list in hand, it’s finally time to start setting things in motion. I recommend implementing a drip campaign; a strategy that will ensure consistent contact with respective homeowners on your list. As its name suggests, a drip campaign will continuously place your company and your message in front of the prospects that will heed it the most. That way, you build a rapport with the recipient without ever having talked to them. At a certain point, they will begin to recognize your brand and eventually feel more comfortable with your marketing.
Let’s take a look at what a direct mail marketing drip campaign might look like:
I can’t stress it enough: you must remain consistent in your direct mail marketing efforts. Never assume one letter will be enough to grab the attention of a homeowner, because its probably not. The idea is to gradually introduce yourself to distressed homeowners over a period of time. It’s been proven that response rates greatly increase upon receiving a third or fourth letter, so don’t give up after the first round.
Step 4: Set Up Your Inbound System
Provided you have executed a flawless direct mail campaign, you have every reason to believe you might get some responses. However, if you aren’t ready for an influx of inquiries, you could have wasted a lot of time and effort. You need to be prepared to answer the phones when your letters start producing results. Set up an inbound system that will take care of and organize the homeowners that contact you.
At this time, determine the best way for homeowners to contact you. Will you give them an email, a phone number or a Google Voice number? Whatever the case may be, you have to be ready to receive inquiries. I recommend avoiding using your personal number. Dedicate a line or a website to collecting the caller information.
Step 5: Track & Organize
Tracking and organizing your direct mail results is equally as important as executing a well-devised campaign, if not more so. If for nothing else, it’s the tracking of your results that will allow you to fine-tune your efforts moving forward.
Whenever you send out a piece of direct mail, be sure to have a way of tracking it; the response rate, that is. In doing so, you will have insight into what is working and, perhaps even more importantly, what isn’t. Only once you are properly tracking your response rate can you spend your marketing dollars more wisely. If you notice one strategy lacking in responses, you may want to consider eliminating it. On the other hand, if you have noticed one strategy picking up the slack, you may want to allocate more funds to the direct mail piece generating the best results.
In tracking your direct mail marketing campaign, it’s entirely possible to increase efficiency, effectiveness and your response rate. Once you have a tracking system down, there is no reason to believe every dollar isn’t being maximized.
I maintain that the time-tested direct mail marketing campaign is more valid than ever. If for nothing else, it offers a personal alternative to an industry that is becoming more impersonal by the day. There is no reason to believe distressed homeowners wont appreciate the time and effort placed in a well-devised direct mail strategy. If you are looking to generate more leads, look no further.