Pushing The Envelope!

-There are many reasons I love direct mail, not the least of which is because it is so cost effective!

By Scott Rister
Author and “real-world” investor
just like yourself.

If you had been looking for the biggest fan of direct mail, then you found him. I won't hide the fact that this is my favorite medium of advertising getting motivated sellers to start calling me. There are many reasons I love direct mail so much and mostly because it is cost effective and prescreens my seller what I am all about.

Cost Effective

My goal is .5% success rate. That's it! For every 200 letters I send out I will field around 20-30 calls. Two to three of those will be potential deals and when I end up negotiating there will be one that is a bona fide "no-brainer gotta do" deal.

Let's add up the cost. Whether you are buying mailing lists or developing your own database there is time or money and sometimes both involved in order to secure the leads. Then you have postage and envelopes of course not to mention a voice mail system or way for seller to contact you which is all part of your overhead cost.

I have gotten down to my "nitty gritty" evaluation of the numbers and generally I get back $5 for every $1 spent in direct mail. This includes my realized profit minus all of my overhead expenses. Do you know of many banks that will give you back $5 for every $1 you give them? I didn't think so and that's why direct mail to me is like money in the bank. In fact I really like spending money on direct mail because I know that that it all comes back to me in the end.

Prescreens My Seller

If you need all-cash and full retail price then I am NOT your answer. I am an investor and expect to make a profit. If you operate your real estate business such as a non-profit charity organization then probably will soon know what Chapter 7 or Chapter 13 means.

In your marketing program if the seller is receiving direct mail from you then either in the text of the letter or in another medium referencing anything like a "free recorded message" they need to be made aware that you are in the business to make a profit. When the seller reaches you then they are aware somewhat that you can be the answer to their situation or problem. However, they should also be expecting to be flexible on price or terms. If not then the conversation will probably be short if you are asking the right type of questions to find their motivation.

Remember that time is the most valuable asset you have. So, a truly effective direct mail campaign should be cost effective and results oriented while at the same time prescreening callers. Follow these principles and you too will find MOTIVATED SELLERS!