How can you use direct mail to grow your real estate investing business?
How have other investors done it?
In this guide, we’ll explain why direct mail is the most powerful marketing medium for real estate investors, show you a real-life case study, and then walk you through the steps to launching your very own successful direct mail campaigns.
The Power of Direct Mail Marketing for Real Estate Investors
As we’ve said in many other articles, direct mail is the best way for real estate investors to grow their businesses.
It’s easy for people like us — entrepreneurs and marketers — to get caught up in the current “highest-converting” fad of the month, but growth and success comes when we put our heads down and do the few things that really work.
Direct mail is one of those things.
Ask any real estate investor worth their salt and 95% of them are sending direct mail campaigns every single month, like it’s a sacred ritual.
Because it is.
Tyler Austin, the founder of REISift, grew his investing business using direct mail… Ryan Dossey, the founder of Call Porter and Ballpoint Marketing, grew his investing business using direct mail…
We’re not saying they didn’t do other things… but direct mail is consistently the foundation upon which real estate investors build their businesses.
And if you want to grow your business — generate more leads, do more deals — than direct mail is the starting point.
Note: We also recommend cold calling and skip tracing as supplemental marketing strategies to your direct mail process. Check out our full real estate investor marketing plan over here.
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Real Estate Direct Mail Case Study: $1 Million in Revenue from Just $30k Marketing Budget
We could just tell you what to do… but why not show you instead?
At the end of 2020, Steve Trang interviewed Tyler Austin to learn how he generated $1 million in revenue through real estate investing with just a $30k budget.
The video is an hour long, but it’s hard-hitting with real value. If you’re serious about growing your own real estate investing business, then give it a watch below.
Determining Your Real Estate Direct Mail Budget
Before you buy mailers or send direct mail, it’s important that you create a realistic budget for yourself — how many mailers do you expect to send before you close a deal? More importantly, how much is it going to cost you?
According to MetroDepth, the average response rate for real estate direct mail is between 2% and 4%.
Let’s do a low estimate and assume a 2% response rate. Let’s also assume that for every 40 leads, you close one deal; that’s a typical ratio for most real estate investors.
So… with those stats, you’ll need to send about 2,000 pieces of mail in order to secure one deal. At $0.50 per piece, you’re looking at a cost of around $1,000 for 2,000 mailers.
It’s important to keep those numbers in mind when you’re launching a campaign — it’ll help you keep your expectations in check.
Note: A lot of factors could change the numbers we’ve presented above. If your campaign is super targeted, then it might generate more leads with fewer mailers. If your mailers are eye-catching, then you might get closer to a 4% response rate. Track your own metrics and adjust your expectations accordingly.
What Are the Best Mailing Lists for Real Estate Investors?
Who should you send mail to?
Here are some of the best mailing lists for finding motivated sellers...
- Tax Delinquent List
- Code Violation List
- Inheritance List
- Yard Sale/Garage Sale List
- Arrest Record List
However, keep in mind that the heart of these mailing lists is high equity — you target people with high equity because they’re more likely to be willing to sell to a cash buyer.
How do you find that data?
You can use a tool like ListSource to collect data. Here’s a video from Tyler Austin that’ll show you how to do that...
Remember, though, that if you only mail all of the basic lists in your market, then competition is going to be thick… because that’s what all of your competitors are doing as well.
You can use REISift to create much more specific mailing lists that get better results (rather than using a shotgun approach). We recommend our 14 Day Auto Lead Gen Challenge to anyone who wants to learn how to organize data and generate leads systematically.
4 Direct Mail Tools to Increase Your Chances of Success
Now let’s talk about some of the tools you’ll want to use to streamline your direct mail marketing efforts and increase your effectiveness.
You can use REISift to organize your data for more targeted direct mail campaigns. This will ensure that you’re not wasting money sending mailers to the wrong people. It’ll help you clean, track, and update your data. You can even skip trace records and schedule direct mail campaigns right inside of REISift.
- Instant Skip Tracing
- USPS Vacancy Check & Absentee Filtering
- Unlimited List Management
- Advanced Filtering For Targeted Marketing
- Advanced Integrations & Zapier
- Advanced Data Cleansing
ListSource is our preferred software for pulling data.
- Search For Properties
- Discover Homeowners
- Create Direct Mail
3. Deal Machine
Deal Machine has a few different functions that are useful for real estate investors. You can look up homeowners, schedule direct mail campaigns, manage leads, and track your driving-for-dollars routes. Each of those tools is priced separately.
- Automated Owner Lookup
- Direct Mail Campaigns
- Real Estate Lead Management
- Driving For Dollars Route Tracking
- Real Estate CRM
You can use YellowLetterHQ to create mailers. You can also do this with REISift, but we thought we’d mention another popular option as well.
- Skip Tracing
- Custom Letter Design
- Custom Postcard Design
3 Types of Direct Mail for Real Estate Investors [With Examples]
You’ve pulled a list, organized it so that it’s as targeted as possible, and now you’re ready to move to marketing.
But what exactly are you going to send?
Here are three different types of mailers to consider with examples.
The first option is to send a basic letter. Here’s an example of what Brad Chandler at Express Homebuyers sends to his lists…
This is the front…
And this is the back…
Postcards are another option. Here’s an example of what Daniel DiGiacomo at Baltimore Wholesale Property, sends to his list…
And finally, you can send hand-written mailers to your list. You don’t have to do this yourself, though, if you use a service like Ballpoint Marketing. Here’s what those mailers look like…
Real Estate Direct Mail Marketing Tips
To finish, we’re going to give you some tips for making your direct mail campaigns as effective as possible.
1. Get Specific
Like we mentioned earlier, if you send to the same lists that all your competitors are sending to, then you’re going to spend more to get fewer results.
That’s why we recommend diving deeper into your data to create more targeted direct mail campaigns.
We like to think of mailing lists as belonging to four different buckets: vacant, stacked, ouchies, and equity.
Many inexperienced investors will just shotgun blast mailers to those buckets without any rhyme or reason — instead, why not get more specific and increase your chance of reaching the right people?
You could send mailers to…
- Absentee owners with 80%+ equity.
- Pre-foreclosure owners with 80%+ equity.
- Probate owners with 80%+ equity.
Those are just some examples.
More specificity = more results for less money.
You can’t, however, send mail to detailed lists like that unless you have software that’ll filter your data for you — that’s what REISift is built to do.
2. Organize & Clean Your Data
Direct mail campaigns are only as effective as the data you pull and the people you send to.
If your data has duplicate records or you’re sending to low-equity owners, then you’re probably going to waste a lot of money.
So organize and clean your list before you send direct mail.
You can do that easily with REISift. Or you can do it manually (not recommended) — here’s a video to help with if that’s the route you choose to go.
3. Run Three Cycles
Let’s talk about what not to do with your direct mail marketing campaigns.
Do not give up on your data after sending only one direct mail campaign. Do not send direct mail to wrong addresses or to people who have clearly expressed no interest. Do not keep spending money to pull more data to make up for poorly managing your previous data.
That’s how many investors operate — and they pay for it.
Because it’s a massive waste of money.
We recommend taking your data through three marketing cycles — this process includes skip tracing, direct mailing, cold calling, and even text messaging.
You milk your data, send a targeted marketing campaign, record the results (DNC, not interested, leads, wrong number), update your data, and then run it all again through a new marketing campaign.
Maybe that sounds confusing.
It’s not. But it does require more explanation to fully understand. Join our Go-No-Go Challenge to fully understand how this marketing process works.
4. Monitor Results
It’s important to monitor the results you get from your direct mail campaign.
At a high level, it’s a good idea to determine the effectiveness of a set of mailers — maybe use a different phone number for each marketing campaign to measure response rate.
More specifically — and for the sake of your future marketing campaigns — it’s important to keep track of leads, wrong numbers, and people who aren’t interested.
Then with each marketing cycle you can optimize your data.
Our tagging system inside of REISift allows you to keep track of who’s who, seamlessly.
5. Be Consistent
As with growing any type of business, the key is consistency.
If you want to systematically grow your real estate investing business, then you should commit to sending a certain amount of mailers — the amount you need to send to get the number of deals you want — every single month.
Do it for a year.
Bet your business won’t be the same afterwards.
Hope that helps!
You should now have a good idea of why direct mail marketing is a key part of growing your real estate investing business, how to determine a realistic budget, which lists to send to, which tool you’ll want to use, what type of mailers to create, and how to get the best results possible.
If you want more direct help going through the process of organizing your data, sending mailers, and generating leads, then we highly recommend joining our 14 Day Auto Lead Gen Challenge.
It’s only $99 and it’ll be a game-changer for your business.