FREE TRAINING: How To Wholesale & Flip Houses From The MLS Without Needing A Real Estate License

Direct Mail - The Ultimate Guide by Real Estate Skills

direct mail Jan 29, 2020

In the real estate world, there have been loads of discussions about direct mail marketing and strategies that can be used to make it work for small businesses.

What you should know is that properly utilizing direct mail as one of your top marketing strategies can clog your funnel with thousands of leads.

But before you scribble direct marketing at the helm of your marketing list, do you have enough knowledge about it? Well, if you don’t, you have come to the right place!

We hope you enjoy Direct Mail: The Ultimate Guide! Use this menu to jump to your section of choice:

 

What Is Direct Mail?

Also known as admail, mailshot, or junk mail (as called by recipients), direct mail is a form of marketing that is physically delivered to a target market’s mailbox through the post office or any other mail delivery service.

Direct mail marketing in real estate includes sending fliers, catalogs, brochures, postcards, and a myriad of other commercial merchandising material. Yellow letters and are a common form of direct mail marketing in real estate. 

This form of marketing can be addressed to pre-selected individuals (which is highly recommended), or unaddressed and delivered to homeowners in a particular neighborhood.

 

Is Direct Mail Dead?

As a real estate investor, you sometimes sit down and wonder – is direct mail dead? Is it even worth your time?

In the digital era we are in today, direct mail sounds outdated and boring. Besides, would you still use a pager to contact your friends while you have a smartphone?

Or maybe, would you travel on a horse chariot, while you can take a bullet train to your destination?

Of course, the answer is no.

Similarly, direct mail feels old, and to many business owners, it is a vice that cannot be comprehended by the contemporary market.

Contrary to popular belief, direct mail marketing is alive and kicking. In fact, it's a game-changer to all marketers across various industries. In real estate, it is alive and well and is associated with high return on investment (ROI).

It is still used by many serious real estate professionals despite a shift towards the preference of email marketing, text messages, and direct messaging on social media sites (such as Facebook, Instagram, and LinkedIn) to get more open rates. These methods are digital equivalents of direct mail marketing. 

Here's a short clip demonstrating the relevance of direct mail marketing in today's business environment:

 

 

Why Is Direct Mail Marketing Effective In Real Estate?

In real estate, direct mail is extremely effective. Through it, investors can find property owners from all over the country who are motivated to sell their properties for various reasons.

Also, it allows them to identify property owners who are in distress and send them advertisements through direct mail.

In addition, direct mail helps real estate investors target their audiences better. For a fact, targeting your prospects on social media is super easy, but think about it – what if you send the right message to your customers using direct mail?

As long as you clearly define your audience, direct mail can be highly specific; thus, helping you target the right clients using the ideal message, and ultimately achieve high ROI.

There are many ways in which real estate investors can make their mailers stand out and result in more motivated seller leads. However, this is a method that requires a great deal of time, money, attention, and skills to get it right!

Direct mail marketing can take up a lot of time to get right. There are other strategies you can use to find more real estate deals in less time.

 

How To Run A Direct Mail Campaign?

Below is a step-by-step process to create a killer direct mail campaign:

Step #1 - Develop A Mailing List

A mailing list is basically a written inventory which highlights the properties you want to send mails to. This can help you establish the zip codes, neighborhoods, property types, types of motivation (high equity, pre-foreclosure status, recently deceased owners, etc.) that you are targeting.

Even though you can use tools such as the USPS Every Door Direct Mail service to identify every home in a particular area, you need to know that you will not get the high-quality leads you desire by sending mailers to every single property under the sun.

Make sure you do prior research, identify homeowners who are in need, as well as develop custom messages that show you are the best choice in the industry.

Ensure your mailing list is filled with individuals who are highly likely to purchase your products or services. To be honest, not all people you send mails to will sell their homes to you.

Nonetheless, by marketing to the right people, you will go a long mile in improving your responses and ultimately get the best conversion rates.

Step #2 - Obtain The Addresses

Once you have identified your mailing list profile and the property owners who are more interested in selling their property, you cannot afford to get their addresses wrong.

Luckily, you can obtain addresses from various places, including county and public records, list brokers, and driving for dollars. 

Driving for dollars is one of the best ways to identify specific addresses in your local market.

We recommend using DealMachine, the driving for dollars app, to maximize your efficiency when using this strategy. It even allows you to send different types of direct mail to these leads straight from the app. Simply download from the Apple App Store or Google Play

Want to try DealMachine For Free?

Try DealMachine (Driving For Dollars App) for free for 14 days and get free 40 “DealCredits” by going here.

When obtaining addresses through list brokers, the most widely used vendors by real estate investors are Click2Mail, ListSource, and Melissadata, or better still, buy a list from another reputable website you may know.

Step #3 - Develop A Mailing Piece

Remember, all homeowners willing to sell their homes don’t have the same needs. They have different problems, and what they need is a real estate professional who will offer them with custom solutions. Therefore, you don’t just mail a common brochure to your mailing list and expect results.

Develop a mailing piece that features a robust offer that will entice your recipient to react.

Also, remember that for your direct mail campaign to prosper, every piece of direct mail should feature a call to action (CTA) that tells the recipient what to do next.

For instance, you can ask the prospective client to: “Call this number to receive an offer on your home” or “Visit my website to receive a free home evaluation report.”

Here's an example of an effective direct mail yellow letter postcard:

direct mail example postcard

If you need a turnkey solution for a simple, but extremely effective real estate investor website, our recommendation is Carrot. 

Look – your goal is not to inform using direct mail advertising. You want to encourage action. Therefore, get creative with relevant graphics when designing your messages, but avoid being pushy.

As long as you provide value upfront and include a simple call to action, there’s no reason why you shouldn’t get leads and conversions in the long run!

Step #4 - Test The Campaign

Before you kick-start the full campaign, test it with a few prospects in your mailing list and see how it goes. Consider sending using priority mail for your test to get a faster result.

If you get a response of over 5%, proceed with the campaign.

Nonetheless, if you get a response rate of less than 2%, consider making adjustments to your list, offer, or message, and test it again until you get it right!

Step #5 - Run The Campaign

If the results from the test campaign are desirable, run the full campaign with confidence! The test campaign is aimed at giving you a glimpse of the rate of client response.

Use this to understand the number of mailers to send in a week.

As a rule of the thumb, make sure you keep your mailing volume in line with your ability to handle customer responses you receive.

Step #6 - Handle Customer Responses

Remember, you have invested a lot of energy, time, and resources in your direct mail marketing efforts. Therefore, you cannot afford to ignore customer responses, regardless of how many you receive.

Since you included a phone number that prospects can call, ensure you have a system in place to track incoming calls. Then, have a well-laid process that will help you to easily follow up with your leads and close deals where possible.

Remember, the quicker you give responses to your target market, the more credibility you get due to a perceived sense of superb customer service.

Step #7 - Analyze The Results Of The Campaign

This is a crucial yet underrated aspect of a mail marketing campaign.

Ask yourself the following questions:

  • Did the final results meet your expectations?
  • Which segment of your audience responded better?
  • Did the direct mail marketing campaign contribute to your sales figures?
  • Did the mail postcards and types of direct mail marketing ads enhance your client database?

A successful direct mail marketing campaign should represent the future of your business. Therefore, an analysis will help you identify problem areas and develop ways to fix them for enhanced results in future campaigns.

"What gets measured gets managed." -Peter DruckerAmerican Business Management Icon

 

Who Should I Send Direct Mail To?

As mentioned earlier, by sending direct mail to right people you can boost response and conversion rates. Some of these people include:

Absentee Homeowners

Absentee homeowners are those whose mailing address is not the subject property address.

More often than not, these people are landlords or investors. Sometimes, they are highly motivated to sell their property because being a landlord is not a walk in the park.

In other instances, absentee owners are those who inherited homes from relatives or those who moved from their previous homes and failed to sell them.

Eviction Records

If you have gone through the process of eviction, you can attest to the fact that this ordeal is an emotional battle that is hard to fight.

Therefore, landlords, who recently evicted tenants might find it hard to continue owning the property and might be motivated to sell it fast.

Probate

When individuals pass away, their property goes into probate depending on their real estate planning.

More often than not, the immediate family has to clean up the property, empty the home, do a host of repairs, and look for prospective clients to sell the property to.

This is an overwhelming and perplexing task. Therefore, if they find a simple way to sell the property fast, they grab it swiftly. Thus, direct mail works great for probate leads.

Pre-foreclosures

When a homeowner stops paying mortgage payments, the bank commences with the process of foreclosure.

As a real estate investor, you can use direct mail to reach out to homeowners facing possible foreclosure and provide a solution that can save their credit.

Tax Delinquent

When one stops paying property taxes, a lien can be placed on the property by local governments. Thus, forcing a tax sale to pay off the back taxes owed to the government.

This situation indicated the property owner is in a financial crisis; thus, direct mail can prompt him to sell the property to you before a tax sale.

You can find delinquencies listed in the local press or on a general circulation newspaper.

Divorce

When couples go through a divorce, they often divide assets and are likely motivated to sell their property.

Expired Listings

When homeowners try to sell their homes with a real estate agent and the deal doesn't go through; the property becomes an expired listing.

There could be an array of reasons which made it difficult for them to sell the property, including high prices and structural issues.

As an investor, target them through direct mail, and you will get leads in no time.

REAL ESTATE SKILLS TIP: There are many lead-generating or marketing companies that track public records and court filings of probate, foreclosing, or divorce filings for your house lists. You can purchase leads from marketing companies such as:

 

How Many Direct Mail Postcards Should I Send?

When using direct mail postcards in your marketing campaign, consistency is key. To get the most out of your campaign, mail to your list more than once.

Remember, it might take 4-5 times or more before a seller will contact you.

You can understand the response rate of your direct mail postcards through testing before you launch a full campaign.

For example, you may get a 1% response rate for every 1,000 postcards you send out. From those 10 property owners who respond, you might convert 20% of those sellers.

In this scenario, your direct mail postcard campaigns are capable of bringing 0.2% conversion rates. Therefore, for every 1,000 postcards you send, you close two deals.

If you flip the contracts and wholesale the deals for $5,000 each, you generate a cool $10,000 in profit!

Let's say the 1,000 mailers cost $1 each or $1,000 total, your net profit is $9,000!

The following chart represents your ROI:

direct mail advertising results

Want to see what your direct mail results could be? Use this direct mail ROI calculator.

With this in mind, work backward and determine the number of conversions you want to get monthly and annually. This will help you know the number of postcards you need to send out to your list.

So, why is once not enough?

In order to further understand why you shouldn’t send direct mail postcards to your list only once, look at the results of a recent survey conducted at a local REIA meeting we attended:

  • First time, response rate = 2%
  • On the second time, response rate = 3%
  • On the third time, response rate = 5%
  • On the fourth time, the response rate = 10%
  • On the fifth time, response rate = 80%

From the figures above, it is evident that persistence is the key to direct mail success. In fact, if you contact your recipients 4-6 times, there are high chances that you will get a conversion rate of over 90%.

Look – when your target market sees your name over and over, your brand becomes familiar with them and gains optimum credibility. Mail your postcards to the same list as many times as your budget can allow, and with time, the ROI you get will be worth every dime you spend.

To maximize your chances of success, do thorough testing before kick-starting your campaign. Also, seek advice from other players in your niche.

Most importantly, have a team that is committed to following through on leads.

 

How Much Does Direct Mail Cost?

The cost of direct mail can vary from 30 cents to over $10 per item sent to leads in your mailing list. This depends on how much you spend on design, mailing lists, marketing copy, printing, volume and distribution.

Below is a breakdown of direct mail marketing based on the factors mentioned above:

The Cost Of Design

Typically, designing a direct mail piece costs $0-$100, depending on the option you choose. If you choose to do it yourself, you will end up spending $0 and some of your time.

You can also use a template which you can buy online at around $10 and do the customization yourself. If you choose to work with a professional designer, you can end up spending as much as $100.

Our recommendation is to use the talent marketplace Fiverr.com to hire a freelancer to create a design for you.

If you’re more the creative type, we recommend using the website Canva.com to develop it yourself!

The Cost of Marketing Copy

If you are a good copywriter, you can write your own marketing copy and spend nothing for it.

However, if you are super-busy, or you can't get your head around developing a persuasive piece, you can hire a freelance writer who has the skills and ability to write content that creates a 'wow' factor in the minds of your prospects at a fee.

This might cost you $30-$100 depending on how you agree with the copywriter.

The Cost of Mailing Lists

You can get a free mailing list by trading with another business in the real estate niche or gathering data from your existing clients.

However, if these two methods don’t work, expect to spend $0.2-$0.3 per record. The overall cost will depend on the quality and the quantity of data you buy.

The Cost of Printing

Typically, printing costs are dependent on the following factors:

  • Color vs. black and white
  • Paper size
  • Paper quality
  • Number of pages
  • One-sided vs. two-sided
  • Quantity

Typically, you will spend $0.03-$2 on printing per property. However, visit your local printing shop, or any reputable online printing business to find out the actual costs.

The Cost of Distribution

Mailing costs are based on a number of factors, including the quantity you send, the weight of your mails, and the current postage rates. However, expect to spend $0.25-$2 per piece for distribution.

 

How Much Does Direct Mail Cost Per 1000 Postcards?

Cost per thousand, also known as CPM, is a popular method that advertising is measured by.  To calculate the cost of direct mail per 1000 postcards, we simply take the total cost of the campaign and divide it by a thousand.

Note: ‘M’ in CPM stands for “Mille” which is a Latin word for thousands.

For instance, if you will be using 10,000 pieces of 4X6 postcards for your campaign, here is how you will calculate the cost of 1,000 pieces:

Let’s say the cost of printing, paper, copywriting, distribution, and tracking amount to $0.5 per piece. For the 10,000 pieces, this is $5,000.

So the cost per 1000 pieces = 5,000/1000 = $5.

 

What’s The Best Size For Direct Mail Postcards?

For direct mail postcards to qualify for the USPS rates, they must meet certain requirements, and size is doubtlessly one of the most important. The standard postcard sizes are:

  • 25” X 5.5”
  • 4” X 6”
  • 25” X 6”
  • 5” X 7”
  • 6” X 8”
  • 5” X 8.5”
  • 4” X 9”
  • 6” X 9”
  • 6” X 11”

Even though all these sizes are mailable, below are those that qualify for USPS rates:

Those sized 4 X 6 qualify for the USPS First Class Postcard Rate.

Those sized 5 X 7- 6 X11 qualify for the USPS First Class Letter Rate or Standard Letter Rate.

 

What Are Some Good Direct Mail Examples?

Below direct mail examples that for real estate investing that you should emulate:

direct mail

This direct mail example postcard is straight to the point with a clear call to action.

Source

direct mail marketing

Here's a classic direct mail example for a real estate investing company.

Source 

direct mail postcards

This a direct mail postcard is referred to as a "yellow letter".

Source

direct mail

Here's another direct mail postcard example, recognize the real estate investor?

Source

 

What Sort Of Direct Mail Response Rates Can I Expect?

On average, the response rates of real estate direct marketing are 2-4% according to various sources. As long as you do proper prior planning and develop the ideal budget, you can rest assured that the real estate letters and postcards you have been sending to your list will reward you with a 2% response rate.

Below are other interesting statics from the Direct Marketing Association (DMA):

  • The average cost per response is $19, which is lower than a host of other marketing channels.
  • The oversized envelope is the best performing direct mail marketing format for real estate and other industries, with an average response rate of 5%.
  • The postcard is another successful format, with an average response rate of 4.25%
  • Here is an interesting bit – according to DMA, direct mail response rates for real estate and other industries outperformed those of all digital channels combined. This means that physical postcards and letters do better than email, pay-per-click, banner ads, social media, and other digital marketing techniques. Interesting, huh?

 

What Are The Advantages Of Direct Mail Marketing?

Direct mail marketing rides along with a host of benefits including:

  • It produces the highest response rates: Multiple studies, including data released by the Direct Marketing Association, have proven that direct mail has the highest response rates than all digital channels combined. Therefore, if you want to get more leads and increase conversions, direct mail is the way to go.
  • Direct mail provides personal touch: The USPS reports that 47% of the people consider mail reading time as time well spent. With direct mail, a real estate investor is able to address a prospect's problem, and provide the most custom solutions. The personal touch in this type of marketing results in more response rates and increases the chances of conversion.
  • Direct mail is tangible and memorable: Research shows that brand recall is 70% high for direct mail pieces than any other form of advertisement, including digital marketing. Therefore, if you want to enhance the credibility of your real estate business, consider focusing on this traditional, yet effective method.
  • Direct mail is less competitive: A recent study shows that the use of direct mail has declined by 29.85% since 2006. This is good news! If there is less clutter, it means there is less competition. Therefore, this methodology provides you with an opportunity for your brand to capture the attention of your target market.
  • Direct mail is scalable: With direct mail, you can spend as much as you want or as little as you want depending on your needs. Also, this marketing method allows you to keep costs at a bare minimum since you can do most of the things yourself.

 

What Are The Best Direct Mailing Services For Real Estate?

Below is a list of some of the best direct mailing services for real estate professionals:

 

What Is Every Door Direct Mail?

Popularly known as EDDM, Every Door Direct Mail is a super-affordable service offered by the United States Postal Service (USPS) which allows you to send a mail piece to every home within a particular selected route at the lowest postage rate without buying a bulk mailing permit or mailing list.

Here's a fantastic promo video from USPS describing exactly what this service is:

 For you to use this service, your mail piece must meet the following requirements;

  • It should have a minimum size of 6.125" X 11.5."
  • It should have a maximum size of 15" X 12."
  • It can be a folded self-mailer, envelope, or card, as long as it meets the above criteria.

To use this service:

1.) Go to the USPS site

Visit the USPS website (linked above), set up an account, and choose the desired route. Then, map out those you want to mail. Once done, you can use this tool to filter your recipients based on their age, household size, and income.

2.) Design and print your mailers

Once you have identified your neighborhoods and defined your audiences, develop effective EDDM advertising pieces. It is recommended that you create actionable mails with a strong offer and a call to action to generate more customer responses.

3.) Choose the drop-off date and payment options

Choose your drop-off date and payment option. You can check more information on how to do this on the USPS website.

4.) Print and prepare your mailing bundles

On the order confirmation screen, print all the required postal service processing forms and attach the ideal Every Door Direct Mail EDDM facing slip to your bundles.

Ship or drop off your mailings or take you’re them to your local post office locations which will then deliver them to the chosen EDDM routes.

 

Is Direct Mail Worth It?

Direct mail is definitely worth it! Nonetheless, the ROI it brings will depend on the effectiveness of the entire campaign, and how well you are able to provide ideal and acceptable solutions to your sellers' problems.

To succeed in direct mail marketing, you need to develop an ability to follow up with your prospects and have the necessary communication and negotiation skills to close deals.

This is what will make your campaign efforts and investment in direct mail worth it!

 

Final Thoughts

Direct mail is, without a doubt, a significant lead generator for both novice and seasoned real estate investors.

We hope this ultimate guide has given you an overview of all the information you need to find the results you desire in this type of marketing.

By using this article as a reference, you will constantly tweak various aspects of your direct mail campaign, and ultimately maximize your returns, attract new leads, get more conversions, and take your real estate business to a whole new level in no time!

Stay connected with news and updates!

Join our mailing list to receive the latest news and updates from our team.
Don't worry, your information will not be shared.

Subscribe
Close

50% Complete

Almost there!

Just enter in your name & email below for Real Estate Investing Golden Nuggets!