Some of the most successful note brokers are those who use direct mail. Direct mail however, has two major drawbacks. It is expensive and difficult to do correctly. However, if it is done correctly, it is very lucrative. To assist you in avoiding the mistakes that I made early on this article will cover some of the things I have learned about direct mail. Like every other approach in the note business, you must have a very creative and professional approach to direct mail. Your letters should be well written and edited. Your material should look very professional. You should be able to deal professionally with the response to your mail campaign.
If you commit to doing direct mail your phone will ring regularly and you will need to handle the calls. It is foolish to mail out 1,000 post cards and when people respond they only get a busy signal. So either upgrade your phone service or mail out only enough pieces to get a response you can handle. You may also want to take a course on direct mail, read books on copy writing and learn how to deal with the U.S. Postal Service. All of these skills are necessary if you want to use direct mail successfully.
If you are going to use direct mail, 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 will get very good results.
Consider the Rule of Seven. In advertising, people do not hear, nor respond to you unless you repeat it seven times. So send postcards, letters, and “stuff” to people 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.
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: Give the customer a reason to call you.
Use Creative Techniques: Use techniques that will increase your response to direct mail such as special envelopes or “lift” letters.
Focus On The Letter: This is the most important part of the direct mail package. Be sure and spend extra time in making your copy professional and to the point.
Postal Regulations: Understanding postal regulations can help you receive discounts and achieve timely deliveries.
Remember Business Reply Envelopes: This allows and easy way for the prospect to respond to you. An 800 number can also be very useful.
Plan Ahead: Take the time to plan and create your direct mailings. Allow 4-6 weeks of preparation.
Analyze Results: Track response times and analyze the effectiveness of your mailings.
Recognize The Test: The “first time” mailing is a test to see what responses you will receive.
Keep It Working: If your approach has been working for you, don’t change it; continue to use what works.
Get Help: There are many services available to help in direct mail advertising. Don’t give up.
Over-engineer: Less is best!
Violate The “Leap Of Faith”: Don’t advertise what isn’t true. Truth in advertising is very important.
Over personalize: Try not to over personalize so that a response device is needed to facilitate a reply.
Try Once And Give Up: Reach the right audience with enough frequency to make an impression.
Neglect The Emotions And Limit Response: Need, greed, fear and exclusivity are emotions that will help gain responses.
Direct mail pieces vary from simple postcards to fat envelopes stuffed with full-color flyers. Direct mail pieces typically consist of:
Sales Letter: The first thing you see in the envelope is the sales letter and it must grab the customer’s attention. It might be personalized with your customer’s name, or it could be a form letter. The letter should include your company logo, name, address and phone number. Form letters are more cost effective but you need to keep your letter personalized in the body of the letter. Grab the reader’s attention in the first sentence. If not, readers will not continue to read it. Focus on the benefits of working with your company. Highlight key phrases that stress benefits to keep the reader interested. Cause your reader to react. They need to feel like they should act quickly or they will lose the offer. Add a postscript to the bottom of your letter. In other words, “Keep this letter in your file for future reference…” etc.
Mail Piece: The next item in your mail piece is a brochure or flyer. This 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 allows the customer to reply to the mailing easily. It may contain information to be able to quote a transaction prior to returning a call to the customer.
- Don’t expect to make money on your first mailing. Do not get discouraged, keep trying.
- Plan to whom, when and how often to do your mailings.
- Know your break-even point. A typical response rate is 1-3 percent.
- Test small mailings with different mail pieces. Use the one with the best response.
- Work your best lists of customers the hardest.
- Make it easy for the customer to respond to you.
- Focus on your message
Mailing List Companies: There are a few companies that compile lists of note holders that you might consider contacting. Experian has a list of privately held mortgages that you can get for around .12 cents per name in several different states and you can add on things like phone numbers and mortgage amounts for a few more cents. They can be reached at 800-316-2637. Dataquick has lists of seller carrybacks and can be reached at 800-863-4636. Check your local Yellow Pages and the Internet for other companies that might have similar lists.
If you choose to use direct mail as one of your marketing methods also remember that the older the names the less response you will receive, I recommend names and addresses that are no more than 6 months old at the most. Additionally, direct mail is a numbers game, the more you can get out the more calls you will get and the more deals you will eventually do. More information on Direct Mail and dozens of other marketing methods that successful consultants and brokers are using can be found in my book “Every Single Profitable Note Marketing Idea In The World (almost)”. Best of luck in your marketing efforts.
Your favorite Master Buyer, Jeff Armstrong, has been in the cash flow industry since 1991. Specializing in the private mortgage note niche and seller financed notes he can be reached at 818-865-2322 or by email at firstname.lastname@example.org. For education, training opportunities, to learn more about the note business or to obtain a quote for a note visit armstrongcapital.com and secretsofpaper.com.