Written by Jeffrey R. Armstrong – President/Owner of Armstrong Capital
Your favorite Master Note Buyer – Straightforward, Honest, Fair…
Direct mail, used by the most successful note brokers, can be extremely lucrative as a marketing tactic. You simply have to avoid the common mistakes that can lead to waste. Direct mail has two major drawbacks: It can be expensive and difficult to carry out without misstep. However, if a direct mail marketing campaign is implemented correctly, it can be very lucrative. To succeed, you simply have to know where the pitfalls might be, do your homework, and be persistent.
General guidelines
Your approach to direct mail must be both creative and professional. Your letters should be well-written and edited. Spelling mistakes or grammatical errors will make you look amateurish. In addition, you’ll want to handle response to your mail campaign in a professional manner. It’s foolish to mail 1,000 postcards to people who will likely hear a busy signal when they respond with a phone call. A typical response rate is 1 percent to 3 percent. So either upgrade your phone service or mail out only enough pieces to generate the level of response you can handle. You may also want to take a course on creating direct mail, read books on copywriting, and investigate the rules and regulations of the U.S. Postal Service. All of these skills are necessary if you want to use direct mail successfully. Finally, you must make a long-term commitment to follow through on your campaign. Sending out one brilliant letter, even with gifts included, will not be as effective as a long-term campaign. Mail often, and you’ll get much better results.
The components. Direct mail pieces vary from simple postcards to fat envelopes stuffed with full-color flyers. Your approach might include one or several of the following:
Sales letter. Your sales letter must grab the customer’s attention. It might be personalized with your customer’s name, or it could be a form letter. At the very least, the letter should include your company logo, name, address, and phone number.
Form letters are more cost effective, but you need to make the body of the letter as personalized as possible. If you’re mailing in one small town, for example, talk about a recent event or well-known news story. The reader will feel you’re speaking to him directly.
Grab the reader’s attention in the first sentence. If not, your customers will likely toss your letter in the garbage. Focus on the benefits of working with your company. Highlight key phrases that stress benefits to keep the reader interested. Compel your reader to react. Your customers need to feel like they should act quickly or they will lose the benefit of working with you.
Add a postscript to the bottom of your letter; it’s your last chance to sum up your offer and provoke a response. Plus, postscripts are a frequently read part of any letter.
Insert. A brochure or flyer is designed to reinforce the sales letter and set an image for your company and the product or service you want to sell. This flyer or brochure might be printed in one or more colors.
Business reply card. A postage-paid business reply card (BRC) enables the customer to reply to the mailing easily. You can use a BRC to collect a few pieces of information, which you can use to solidify your relationship with the customer when you contact him.
Mailing list companies. You might consider contacting one of the following companies, which compile lists of note holders. Experian (experiandataselect.com) has a list of privately held mortgages in several different states you can get for around 12 cents – 25 cents each. You can add on details like phone numbers and mortgage amounts for a few more cents. Dataquick (dataquick.com) features a product called ProspectFinder, which you can use to acquire a list of seller carrybacks. Check your local Yellow Pages and the Internet for other companies that might have similar lists. Lender Processing Services (Lpsvcs.com) is another option and the one that I use.
Direct Mail Suggestions
According to direct mail marketing experts, “carefully targeting the prospect is the single most important factor in direct mail.” Following are some suggestions for an effective direct mail marketing campaign.
Make a compelling offer. In direct mail, 40 percent of your success can be attributed to the offer. Give your customers a reason to call you; make your offer so enticing, they have to call.
Work your best lists the hardest. Another 40 percent of your success can be credited to your list. So when you find the type of person who responds best to your type of service, keep mailing to that list again and again.
Give them a way to respond. Response devices include making a phone call, sending an e-mail or fax, or mailing back a response card or business reply envelope. Make it easy for the customer to respond to you.
Use creative techniques. The final 20 percent of the direct-mail formula belongs to the creative — what you write and how you package it. Make sure your overall message is persuasive, professional, and to the point, and use devices that will increase response to direct mail, such as special envelopes or lift notes.
Research postal regulations. Understanding postal regulations can help you receive discounts and achieve timely deliveries.
Plan ahead. Take time to plan and execute your direct mailing campaigns. Allow four to six weeks for preparation. Follow a detailed plan that includes who you’re mailing to, when you’re mailing, and how often you’re mailing.
Analyze results. Track response times and analyze the effectiveness of your mailings. Test small mailings with different mail pieces, until you find a winning approach.
Establish a “control.” When you find an approach that works, use it for the majority of your mailings. But continue to test different approaches to see if you can improve your results.
Ask for help. There are many services you can turn to for assistance with your direct mail advertising campaign. A quick Internet search should provide you plenty of ideas.
Respect the Rule of Seven. In advertising, people won’t typically respond to you unless you repeat your message seven times. So send postcards, letters, and communication to your prospects every month for at least a year. Again, be creative, if you do things in the same old way you’ll be the same old broke.
Don’t over-engineer. When it comes to your printed pieces, less is best!
Don’t violate the “leap of faith.” Truth in advertising is very important, and you want to maintain trust with your prospects. Don’t advertise what isn’t true.
Don’t forget your CTA. In fact, you want several calls to action within your marketing piece. Give you prospect several chances to pick up the phone and call you, or send you an e-mail.
Don’t give up after one try. Reach out to the right audience with enough frequency to make an impression.
Don’t neglect emotions. Use people’s action-provoking emotions to generate a response. Your goal is to have your prospects feeling need, greed, fear, or wanting exclusivity — and knowing your product or service is the answer to their desires.
Don’t get discouraged. You can’t expect to make money on your first mailing. Keep testing concepts and remain persistent.
A numbers game
Cash flow consultants who choose to use direct mail as one of their marketing methods should also remember one final thought: The older your list of names, the less response you’ll receive. Your names and addresses should be no more than 6 months old at the most.
Direct mail is a huge numbers game; the more advertising pieces you can send out, the more calls you’ll get, and the more transactions you will eventually complete.
Remember, success demands action! Keep on marketing, it’s going to work! TWITA! (That’s What I’m Talking About!)